Last month a bold new US retail player – Brandless, where everything sells for $3 – exploded onto the online scene. Already, natural products industry insiders are asking if it could prove to be a category disruptor.
The company, which raised $50 million in funding to get its business up and running, comes from a different place to most online retailers. It has a distinctive ethical and social underpinning and references the Occupy movement in explaining why it thinks “people deserve better”.
The Brandless site makes it easy to ‘shop by values’ – certified organic, non-GMO, gluten-free, vegan, kosher etc – and there is a wide choice of natural and organic food, beauty ands home care products. And if you happen need some recycled mechanical pencils or FSC certified craft note pads, you’ll also be in luck – Brandless has an attractive ‘home and office’ offer too.
Brandless says its mission is “rooted in quality, transparency, and community-driven values”. But more than anything it is on a mission to banish brands (the clue really is in the name) and what it calls the ‘BrandTax’ – the “hidden cost you pay for a national brand”.
Brandless claims that the average person pays “at least 40% more for products of comparable quality as ours – and sometimes up to 370% more for beauty products like face cream”. The retailer says it has benchmarked pricing across five major retailers (in-store and online). Using that information it has calculated the ‘BrandTax’ for each item across its everyday essentials selection.
All Brandless products feature a simple product descriptor – Black Beans, Flax Granola, Cotton Balls and so on – and come in stylishly minimalistic packs. The company describes the $3 price point as “the middle point between value and quality”.
In a recent interview with US trade website newhope360.com, Brandless chief merchandiser, Rachel Vegas, said: “A lot of retailers do private label, lots do better-for-you and some do ecommerce. But no one was doing all three exclusively. So there was this white space where we could meet an unmet consumer need. Seventy-seven percent of millennials don’t want to buy the brands their parents buy, and 88 percent are interested in buying private label”.