262. How I Eat My Greens Is Reviving Soup with Flavor, Freshness, and Smarter Retail Growth

0:01Mac Villarreal:Welcome to Startup to Scale, a podcast by FoodBevy. I'm your host Jordan Buckner. Join me as I talk to aspiring entrepreneurs, seasoned industry experts, and everyone in between as we unlock the keys to growing from startup to scale.

0:18Mac Villarreal:Many of the new products launching today are selling some sort of functionality, going like really high protein, low sugar, energy, sweet benefits. But there's actually a growing return to making foods that prioritize flavor over just purely function, although that's always going to be part of it with any good food. Of course, they're nutritious, but they have to actually taste good, too. So when Mac Villareal started I Eat My Greens, He wants to make vegetables something people actually want to eat. And that mindset has taken them from just an idea for a soup brand, Ruten Family Cooking, to the shelves at Sprouse Wegmans and Fresh Thyme and more.

0:55Mac Villarreal:Getting on the shelf is hard, but the real challenge is actually selling off of the shelf once you are there. So I invited him on today to really talk through the journey and share tools and strategies that he's using to drive retail velocity and get noticed in the category that has kind of grown stale over the years. And also just want to make a note that this episode's sponsor is Retail Media IQ, which helps brands drive sales and velocity through Instacart, Walmart, and Whole Foods digital ads. And we'll be hearing from Matt from Retail Media IQ a little bit later. But Mac, I want to invite you on to the podcast.

1:30Mac Villarreal:So welcome. Good to see you. Hey, it's great to see you, Jordan. So I'd love for you to share a little bit about what I Eat My Greens is just as a product to give people a little bit of a context of what the product is. Sure. I Amagreens is a line of refrigerated in-label soups. That's awesome. And tell me a little bit about the kind of founding story. So you started with the goal of making vegetables, something people actually wanted to eat. What did that look like in the early days and what really prompted you to kind of start this as a CBG brand? Sure.

2:02Mateusz Drela:I found a problem that was more a personal problem, but I realized it was not just me. People, of course, we all want to eat better. We all, you know, want to eat healthy food. But real life gets in the way. Time to cook. Too many processed, ultra-processed options out there. Just easy and convenient to just grab and go at it. And then some of the healthy food just doesn't taste good. It just doesn't. That's why we reach for the other kind of food. And that's frustrating because we all know we should be eating better. But it's hard to find those options that really fit into your life. And I believe that that trade-off shouldn't exist.

2:42Mateusz Drela:And you should not be having to choose between what's good for you and what actually tastes good. And that's really where I, My Greens came in as an idea to pursue about five years ago.

2:54Mac Villarreal:That's awesome. Talk to me a little bit about what the soup category looked like when you're thinking about starting a brand, right? And what did you kind of see on shelf that you were responding to?

3:06Mateusz Drela:Yeah. Of course, we've seen the canned soup since before World War II. So it's been a long soup. It's been there, but it has lacked that home-cooked quality flavor. My grandmother used to make soups from scratch, right? And I was fortunate to grow up with home-cooked food full of flavor made with care. And I actually used to hate vegetables. so I realized that through soup mainly it's the way I was eating healthier better and more veggies and then I moved from Mexico to the U.S. became a dad life just gets busier and crazier and didn't have time to cook just the options out there didn't feel authentic real food like I was used to and that made me you know go at the farmer's market with soup and try out if that would be something that people would really care about and value, making that same feeling of comfort, of feeling good after you eat food, that food is actually fuel, makes us feel better.

4:06Mateusz Drela:So that's how it all started. And that's why I saw an opportunity specifically in soups.

4:11Mac Villarreal:So a lot of those options are canned. There aren't very many kind of refrigerated soup options in a lot of the grocery stores, right? I think sometimes they'll have like, There's like jars of soup, sometimes like a store brand, or I think like Panera had a couple of their like plastic kind of tubs of soup. But a lot of consumers may not like go to the refrigerated section kind of looking for soup. And so how did you have to educate consumers to really get in front of them so that they knew to look for your products like in that refrigerated aisle?

4:43Mateusz Drela:Yeah, yeah, it's a good question. I also come from the juice world where refrigerated juice has its greatest qualities over shelf stable. Just the freshness. I mean, just the quality of the product when it's fresh. And we've, you know, it's been about once we're on shelf, I think it's a combination of promotions, the packaging and demos. And I think the hardest one to do or to nail is the promotions part. because that's when things get either really expensive, scary, and if the return of investment is not there, then that's where I see brands or we've suffered with a lot of expenses with not the return there and that can be scary and that's not a good thing.

5:27Mac Villarreal:Yeah, right. It's hard because I can see why retailers might be interested because soup is a fairly stable volume category for stores, but it's mostly been based in this canned format. When you were talking to retailers, how did those conversations go and what was most exciting about why they wanted to bring on I Eat My Greens into their store? What really resonated with them?

5:49Mateusz Drela:Yeah, they understand what has happened in other categories. For example, the baby food category, right? Going to refrigerated fresh, the bar category, going also some great options on fresh. So there's certain categories that are naturally moving and succeeding in the fresh format. Because that's what the consumer is looking for. Healthier, like I was saying, real food that's not preserved or over-processed. So that's the value they are seeing and that I saw. And people can notice it in their shopping basket.

6:22Mac Villarreal:I love that. And I think that, you know, I love how you mentioned like, you know, promotions, trying to figure out how to get people to find it on shelf is always really important. What have you kind of learned in terms of how people are shopping for soup in that category? and what's the biggest driver for getting them to actually like, stop, know this and try your products?

6:40Mateusz Drela:I think it's applicable to many categories, but it's, I mean, demos are always good, but they're expensive and really hard to manage and to do. Like I said, packaging is very important. But, and then it's promotions, either sales tags or digital. And I know today we're going to talk about that digital promotions, And that's been key for bringing in people, shoppers that didn't know about our product specifically and that they're digital shoppers. And just it's important to be present at the right time for what they're trying to purchase and solve in their life. That in my case, it's eating real food in a very convenient way.

7:21Mac Villarreal:Yeah, I think that's one thing that's really interesting because trying to change the way someone shops in a grocery store is really challenging. especially when they're used to like walking to the store a lot of times it's moms they're like busy they may or may not have the kids like I go shopping with my kids all the time and like sometimes we're in discovery mode but sometimes we're like looking for a product and I'll walk past literally thousands of products and not look at them at all and so it's so hard to kind of stop and change behavior in the store that's why demos and sometimes promotions work but I've been really fascinated about how some of these digital platforms are changing how people are shopping for different products in the store, right?

8:00Mac Villarreal:Whereas before, if you wanted soup, someone might go and like, look, okay, where's the soup aisle? That might be their first thought. It didn't go and there's a bunch of canned options. But if you're in the fresh section of the store, maybe buy produce or some have like the juices, that might be hard for someone to think about. But if they're using a digital platform like Instacart or kind of buying to have delivery or pickup or one of those options, if they type in soup, it can show you both the canned and the frisier of the options and kind of one search. And so I want to bring Matt in from Retail Media IQ because I love kind of how you and the team are really thinking about this space and how it's involving.

8:36Mac Villarreal:And you work with Ate My Greens as a client and brought them on. I'd love to hear from your perspective, like what this digital retail media landscape looks like. I know some people are familiar with grocery delivery every week. Other people have maybe never tried it. And so lay out kind of what that landscape really looks like.

8:54Mateusz Drela:Yeah, absolutely. So, I mean, it's a very fascinating, super quickly evolving landscape. It started with Amazon. And now essentially every single major retailer has their own advertising platform that allows brands that sell to that particular retailer to promote their products to shoppers. And then on top of that, you have, like we mentioned, Instacart and other delivery platforms which kind of sit in the middle or on top of these and facilitate the shopping between and the retail experience. And they allow for advertising as well. So this really is a very, very important change, especially for CPG brands and especially for growing for young brands.

9:32Mateusz Drela:You know, before, you know, as Mac mentioned, I mean, you really had a limited amount of choices when it comes to, you know, promoting your product. You could do in-store promos, you could do trials, you could do couponing, things like that, all things which are expensive. And it's difficult to see an immediate return on your investment. And, you know, if you wanted to digital, your options were even more limited. I mean, you could do social media, but then promoting a product like Max on, let's say, Instagram or TikTok. OK, you can get some awareness, but translating that, you know, awareness into sales velocity, that's just it's a very difficult thing to do.

10:10Mateusz Drela:And then, you know, retail media actually allows you to see, OK, I place an ad. I placed that ad to a shopper that was looking for a specific product, let's say organic soup or tomato soup, Max case. And we see that, you know, we spend X dollars on ads and got Y dollars in sales. And not only that, we can also work with it. We can optimize it. We can make it we can make it better. So, you know, very, very important development.

10:35Mac Villarreal:So talk to me a little bit about when you started working with I Eat My Greens. What opportunities did you see for how this retail media advertising through retailers platforms could really help out Mac and the company?

10:48Mateusz Drela:Yeah, so when we started working with Mac, he was already actively advertising on Instacart. But and this is a very, very common story. The advertising was working well. I mean, it was delivering sales, but the economics weren't really working out as well as in this case Mac would really have liked to. You know, so our challenge was to take a channel that's already been proven that it can be effective, but actually make it work for his brand specifically for his unit economics, for his sort of, you know, the costs and margin levels. So that this doesn't become just, you know, advertising costs that might pay off at some point in the future, but it becomes an ongoing engine where, you know, every dollar invested is actually a profit.

11:38Mateusz Drela:then that profit can be reinvested into more customer acquisition.

11:41Mac Villarreal:No, I think that's so important. And Mac, to bring it back to you, when you started doing some of this advertisement yourself, did you set it up? And what was it like when you went through yourself to start using some of these ad platforms?

11:56Mateusz Drela:Yes. I mean, Instacart makes it pretty easy to set up as far as just automatic and don't do anything, but it's not the most efficient. so I knew there was things that we can do better. That's always been the case as a company. It's like, let's find a way to be better. We can do better. And I knew we could. The results were not 100 % there. So that's why I got, I talked to Matt and really, really easy to talk to the team at RMIQ and set our goals together, understand what we're looking for and really build that confidence that, okay, we're going to try this because it sounds like it's a good idea.

12:33We're going to get what we're looking for.

12:36Mateusz Drela:It's going to be a win-win.

12:37Mac Villarreal:And that has been the case. So it sounds like you, we talked through your problem of like, you have this really great product, but it's outside maybe of how consumers are typically shopping. There's an opportunity to maybe reach them in a clearer way through digital. You tried it yourself and it was, you know, it sounded like it was like pretty easy to set up, like going fine, but not done to like the maximum amount that you probably could have. And is that kind of what led you to reach out and to look for help?

13:03Mateusz Drela:Yeah, yeah. We're a very lean team, right? So we're not experts in digital. Digital, it's its own world. And there's a lot of shoppers that only shop digital. So we were never going to reach them no matter what product or, but it's hard to reach them no matter what product or where we were in the store. So I knew we had to capture that digital shopper and we had it to make efficient and smart. And we are not, we don't have a digital market expert on our team. So, you know, here's Matt, the expert, and let's see what he can bring to the table. And things have worked well.

13:36Mac Villarreal:I was going to say, like, tell me about like what improvements you've seen from working with Matt and his team. Like, have you noticed so like more sales that you've been able to drive from it, better kind of ad efficiency? what's been kind of the biggest impact?

13:49Mateusz Drela:Yes, optimizing, for example, keywords, like just the whole Instacart algorithm to get the returns. There's things that they have that I'll let Matt talk about the technical stuff that make just the ROAS higher, you know, everything, all the KPIs just improve because there's things that are much better done with expertise than just turning on the automatic algorithm that Instacart offers.

14:14Mac Villarreal:Yeah, so Matt, then what did you notice about? some of those changes that you were able to identify and make to your account and, you know, what were you able to accomplish and what kind of impact did you have on the business?

14:25Mateusz Drela:I mean, it's, you know, our approach in general is trying to break the performance. My background is in performance marketing. I've been doing it in my entire business careers. Essentially, what we're doing with RMIQ is taking that knowledge and experience and translating it into this world of retail marketing. And, you know, the basic principle of performance marketing is you break everything down to the lowest level that you can control and optimize at that level. So with Mac or with other clients that we work with, you know, we take the products. Products are always going to have, there's always going to be a difference in performance on the product level.

15:04Mateusz Drela:Take the keywords, you know, keywords for product, they're always going to be different in terms of performance and take the bids. And those are the elements that you can, Then essentially, you know, you figure out what's efficient, what's not efficient, that you cut off the parts which are not efficient, the ones that are already delivering sales. We improve those. And then we make sure that, let's say, max soups show up to users that are performing the most relevant searches and that we pay for that user the right amount. I mean, it all comes down to relevance and price.

15:36Mac Villarreal:One thing that's, you know, interesting, I always think is like, what kind of products are best suited for growth through this channel? Do you find, is there like particular product categories that have better for like advertising through these platforms?

15:52Mateusz Drela:I mean, not necessarily. I mean, we're finding, you know, I guess success across many different product categories and product types. I think the ones where you would, which might be slightly challenging as products that are a category of their own, that nobody really searches for that particular sort of keyword combination, right? is the marketing is very much based on showing relevant products to shoppers at relevant decision moments. And if you have something that's completely new, that's out of the category that nobody's really thinking of and searching for, you know, the best thing you can do is kind of show them doing category adjacent searches.

16:34Mateusz Drela:And that's still going to drive sales, but it's not going to be as efficient.

16:39Mac Villarreal:Okay. I think that, you know, that totally makes sense. And then is Is there a sense of like how big this channel can be, like determine like how many sales you can drive through Instacart? I know it's a little different because you're like advertising on the platform, but the sales can come through the retailer as well. Like how does that combination work in terms of understanding how much revenue you're able to drive or what performance you're able to drive?

17:03Mateusz Drela:Yeah. So, I mean, if you think about it, right, Instacart is an intermediation platform. So it's something that allows you to shop for products which are physically on the shelf, which is actually what happens. In most cases, an Instacart shopper goes into a store, picks up an item, puts it in a basket and delivers it to you. So, you know, your spend is slightly limited or is limited by your distribution. Then, you know, as a factor of your distribution, I mean, on average, 20 and 30 percent of CPG sales happen online. And of course, you know, to a certain demographic, Instacart skews to wealthier, younger audience.