The site offers everyday essentials for less by stripping away the brand names.
Got three bucks? You can snag a jar of organic peanut butter, a bag of quinoa puffs or a porcelain dinner plate at this online shop where every single item is just $3.
And even celebrities like NBA players Stephen Curry and Nick “Swaggy P” Young, cookbook author Jessica Seinfeld, former Facebook spokesperson Randi Zuckerberg (sister of Mark Zuckerberg) and talent manager turned businessman Scooter Braun are buying into Brandless.com, the site announced on Thursday.
Brandless manages to sell nearly 250 food, beauty, personal care and houseware products for just a few singles by stripping away the brand names that often inflate the price of products.
“We wanted to debunk the idea that better needs to cost more, and people shouldn’t have to go deep into their wallets and take a huge cut out of their paycheck for the natural, non GMO, gluten-free items that they want,” Brandless CEO Tina Sharkey told Moneyish. Sharkey and co-founder Ido Leffler spent four years getting their non-brand off the ground in time for its July 11 launch.
And over the past 22 weeks, Brandless has doubled its product lineup, adding organic spices and soups, dried fruit and nuts and baking mixes to its digital grocery department, and tripling the number of beauty and health care products to include tampons and multivitamins – and everything is still just $3 a pop, plus a $5 flat shipping rate.
They estimate that what they call “BrandTax” – the added cost that a national brand tacks onto its product to pay the distributor, the grocery store, securing prime shelf space, as well as marketing and more – can increase the cost of products by 40%.
“The entire industry today is built up of inefficiencies that have occurred over a significant period of time, and the layer upon layer of inefficiencies has added up the cost that consumers take on every day,” explained Leffler. “So we work as closely as possible with the people who create the products and goods for us to get them to the customers in the most efficient way possible.”
Which means you’re only paying $3 for organic peanut butter here versus about $4 at Walmart or almost $5 at Target – and also why Brandless plans to remain an exclusively online shopping experience. And many Brandless products are organic, Kosher, gluten-free, non-GMO, fair trade or made with no added sugar to satisfy shoppers’ increasingly more selective tastes. Many are made in the U.S., particularly the Midwest, but the pasta sauce is made in Italy, and some of the housewares come from Asia.
Brandless also believes jumping off the brand-wagon will attract Millennials, who don’t want to be boxed in by labels, since none of these products actually have brand labels. Each item just prints the name of the product and its specifications – for example, “Blueberry Flax Granola” and a checklist that reveals it’s non-GMO, whole grain, and contains no artificial colors, flavors or preservatives.
“It’s appealing to the first-time head-of-household consumer, the urban Millennial who’s setting up a college dorm, setting up their apartment, setting up their start-up, who is trying to live paycheck to paycheck and shouldn’t have to go to a farmer’s market and spend $12 on granola,” Sharkey said.
And the products they’ve chosen, like spicy jalapeno and cheddar-flavored quinoa puffs or organic blue corn tortilla chips, are very data-driven.
“We know that people buy snacks 52 times a year, and snacks were a $90 billion industry last year, so we have stocked a lot of snacks,” Sharkey said. “And Millennials are turning their backs on established brands – 77% of Millennials don’t want to buy the products their parents used … so it’s our hope that Brandless will help you drop the idea that you have to eat a certain brand to live to somebody else’s standard.”
And this anti-brand appetite is seen in the recent struggle of iconic American food brands like Kellogg, Kraft and Campbell’s, which have seen both upscale fresh, unprocessed foods and low-cost store brands take a bite out of their sales. The top 25 Big Food brands’ U.S. food and beverage sales dropped 3% between 2012 and 2016 – which sounds small, but has hurt sales and profits, the Wall Street Journal reported. Now Nestle is sell its U.S. confectionery business, which includes the Butterfinger and Baby Ruth bars, and General Mills has launched a French-style line of yogurt to compete with Chobani.
And Brandless has also tapped into the Millennials’ favoring of socially conscious companies by partnering with Feeding America, a hunger relief organization, to donate a meal every time someone places a Brandless order. They’ve donated 175,000 meals since the launch. This aligns with what Leffler has done as co-founder and CEO of Yoobi, which matches any school and office supplies you buy by donating goods to classrooms in need.And Brandless has also tapped into the Millennials’ favoring of socially conscious companies by partnering with Feeding America, a hunger relief organization, to donate a meal every time someone places a Brandless order. This aligns with what Leffler has done as co-founder and CEO of Yoobi, which matches any school and office supplies you buy by donating goods to classrooms in need.
The start-up force is strong in these two entrepreneurs. Leffler has also co-founded beauty company Yes To, Inc., tableware brand Cheeky and Beach House Group. Sharkey currently sits on the board of directors at ipsy, a beauty subscription box service, and Brit + Co media company, and was once a senior leader at AOL.
Plus, keeping everything the same price makes tallying up your grocery tab a snap.
“A lot of the early feedback we’ve had from some initial customers already is that it’s ‘delightful’ not have to think about what everything costs,” said Leffler.
This story was originally published on July 14, 2017, and has been updated to include the new investors and product lines.
© 2018 Dow Jones & Company, Inc. All Rights Reserved