Welcome to eatbigfish’s annual list of the challenger brands you need to know about in the year ahead. In a volatile and changing world, many of our picks this year are tackling the climate crisis in big and in small ways. Expect big things from this bunch in 2020. Enjoy.
Challenger to watch: Nuggs
It seems likely that the ’20s are the decade where global warming will get personal. Both in terms of the personal impact of our environment either being on fire or underwater and in terms of a growing personal desire to take action before it’s definitely too late. It will be the decade we realise we’re going to have to give up some of our toys.
For many of us, this will mean eating less meat – a bigger driver of greenhouse emissions than all transport (land, sea and air) combined - not to mention deforestation and water pollution.
Fortunately, it will also be the decade of new brands - and categories – helping to soften this blow.
For those of us still keen to have our cow and eat it, there’s been an explosion of plant-based/analogue/mock/faux meat* brands to rescue our carnivorous lifestyles. From the biggest fast-food brands to the supermarket meat aisle, imitation-meat is now rapidly becoming mainstream in a way tofu and Quorn, historically at least, never quite managed.
But for NUGGS – makers of a ‘chicken nugget simulation’ - becoming ‘mainstream’ is part of the problem.
For a category that’s so new - it’s not yet settled on what to call itself for example, it’s surprising how quickly the leading brands have adopted the codes and conventions of the old world of meat, with an added serving of environmental mission and a Next Generation narrative.
Great, but perhaps an opportunity missed to define an entirely new playbook.
So NUGGS is aiming to do just that.
With a former tech entrepreneur, Ben Pasternak as founder, NUGGS is looking outside its category at the world of tech for inspiration in how to disrupt this new status quo.
With a core purpose to make simulated nuggets go viral, it describes itself as a tech company, ‘engineering the world’s most advanced nugget technology™’.
This approach is embodied across every touchpoint of the brand – from its ‘features’ and ‘tech specs’ (read nutritional information) to user reviews and most interestingly, its release notes: each time NUGGS improve the recipe it releases a new product version (currently at NUGGS 1.5) – after all, consumers are far more willing to forgive a product that might not yet be quite right when they know you’re in a constant programme of incremental improvement based on their feedback.
If all of this has made you fancy a few nuggets (and you’re based in the US) then a box of simulated chicken nuggets are only a few clicks away – adopting a D2C distribution model, boxes of NUGGs can only be bought directly from the NUGGS website, either individually, in a double pack, or as a pallet of 420 boxes, but as the web copy says, you probably don’t need this.
*NUGGS is going for ‘clean meat’ – it’ll be interesting to see if this sticks.
Challenger to watch: Majority
Majority is “the first digital financial service built by migrants, for migrants.”
A long time ago I moved to America. Getting a bank account and a credit card took ages, even though I had good credit and could navigate all the “no, sirs” in my first language. There are legit reasons for this — no proof of residence, no social security number — to name but two. Imagine how hard it is to convince a landlord without the legitimacy of a 100-year-old institution behind you.
Now imagine you don’t speak the language too well, have less than secure employment, and scant proof of your financial history. Some of you will carry the weight of expectations of the family you left behind; you were the chosen one everyone agreed would go. There’s a lot riding on this.
That very insecure feeling you have now is common to many of the 258 million migrants around the world, and it is what Majority will address as “the first digital financial service built by migrants, for migrants.”
Majority is a subscription service. For $5/month you get banking, remittances, and international calling. Migrants are spending on average over $30/month for all that today and are more vulnerable to the punitive ATM and overdraft charges of the brick and mortar banks. This is a strong value proposition. Add to this customer service in many languages and community centers in major metros in the US for migrants to connect and build a sense of place, and you have something quite compelling.
This is, of course, one way that challengers win: carve out a specific segment, design for them, addressing the pain points that large incumbents have glossed over for ages, and wrap it in shared values. Worked for Mini Cooper, Clif Bar, and Made, and one of our clients in the same space as Majority, Xoom.
Some of the people behind Majority worked at our former client Tele2 on the Comviq brand, which has long championed the immigrant community in Sweden. They know this audience and how to run effective acquisition campaigns. And with Lotta Onajin as their Chief Story Officer, this is definitely one to watch.
Challenger to watch: Habito
They say ‘There’s no such thing as a boring product, just boring marketing’. Several years ago, this ad-land philosophising did little to improve my outlook while working on a diarrhoea relief brand. But now and again, we see a challenger redefine a category by refusing to accept that its product or service sits in a dull space.
Getting a mortgage was once a hallmark of adulthood, but nowadays the housing ladder is increasingly out of reach for many. In the run-up to the UK’s general election, Question Time ran a programme with an audience of exclusively under-30s. In discussing the housing crisis, it was striking that almost all of the politicians on the panel owned their first property pre-thirty whilst the property-owning hands in the audience were sparse. Not only can people not afford to get on the first rung of the ladder, but when you do have the chance, getting a mortgage is notoriously painful.
Securing your mortgage comes with a lot of baggage. Firstly, there’s technical baggage, the world of rates, terms and to offset or not. It’s enough to make all but the hardened economist prefer to sort their sock drawer instead. Secondly, there’s the emotional baggage, interrogating your spending habits and making a commitment for the rest of time. Renting (or paying somebody else’s mortgage) isn’t fun, but at least you can envisage theoretically walking away. Thirdly, the decision is made trickier by promises of ‘great deals’ from mortgage brokers. The result is that we are left feeling frustrated and ignorant about the biggest investment many of us will ever make.
So, hats off to Habito for looking at the painful mortgage game and thinking ‘I want me a slice of that’. Habito launched in the UK in 2015 as a platform that helps you choose and secure a mortgage or remortgage. It is like a private broker, but the service is free and it’s not in cahoots with one of the banks. Thus far it’s received £29m in total funding, has given punters a choice of over 20,000 mortgages and has 3500+ excellent ratings on Trust Pilot.
When selling mortgages banks still tend to show chuckling couples, apparently having a whale of a time sorting theirs out together in between gags. Habito stands out because of its honesty around its mission to ‘make mortgage worries history’. This challenger leans into the monster of the category by asking us if we are ‘Getting the mortgage sweats?’ Which is more than just a funny bit of copy. Its research found that 1/10 people had seen their GP about stress and anxiety relating to their mortgage
With Habito you get a sense of a man on a mission and it turns out Daniel Hegarty is just that. It was his own hideous property purchase experience that resulted in his founding of the company Daniel vowed to make ‘a simple, honest way to find and apply for the best mortgage available for you’.
In July 2019, Habito went beyond comparisons and began offering its own range of mortgage products. In 2020, I want to see whether it can dramatically challenge the nature of the product itself. I am hoping its rich customer data will illuminate previously ignored pain points and enable it to make mortgages themselves more heavenly.
Challenger to watch: Polestar
Love him or loathe him, Elon Musk is a brilliant marketer.
Market leader in Electric Vehicles (EV) in the US, Tesla spends ZERO on advertising. Instead, Musk uses his personal brand to get people looking at Tesla. A willingness to share ideas, successes, failures and personal opinions on Twitter has seen him amass +30m followers, providing a sizeable and already engaged audience to promote Tesla.
EV competitors will need to battle with Tesla not just in terms of their product and features, but in terms of the visibility and fame-driven marketing, its enigmatic CEO gives them.
Polestar is one such competitor looking to challenge Tesla in 2020.
With transport being one of the biggest sources of global carbon emissions, growth in electric vehicles sales is forecast to rise rapidly with EVs and HEVs making up 30% of all purchases by 2025.
But challengers don't succeed by following the approach of the market leader or by imitating them. Polestar will need to carve out its own path and make clear how it's different.
It sounds like it's aware of this need.
For starters, Polestar, launched as a stand-alone brand in 2017 and focusing solely on EV, is a subsidiary of Swedish company Volvo. Volvo is known for being safe and reliable… good brand equities but it's not going to cut the mustard against Tesla’s sexy-apocalypse vibes.
Rather than attempt to compete from the parent brand, it's clearly felt that, strategically, the best bet would be to start from a clean slate, without the baggage of Volvo’s 93 years of history.
Launching a sub-brand provides an opportunity to compete without the historical baggage and perception consumers may have about the parent brand. It can start entirely from scratch, building a new brand identity for a new generation or sub-section of consumers.
Polestar’s website reads:
"The maturity of the automotive industry has become a barrier to innovation. Over time, cars have started to all look the same, feel the same, be the same. We constantly question industry ideas and thinking, challenging ourselves to be better, never accepting mediocrity. We are passionate about design, performance and precision and obsess over each and every detail. We have no legacy, no ties to the past; we are free to find the right way."
Polestar certainly speaks like a challenger. But can it live up to these words?
It offers two products, the Polestar 1 - a 2-door hybrid sports car which launched in 2019 and the Polestar 2 - an all-electric 5-door which goes into production in 2020 and will compete directly with Tesla's Model-3 - the best-selling EV in the US and UK.
Polestar takes an interesting approach to its retail experience, perhaps drawing inspiration from Apple’s ‘Genius Bars’ (or Tesla’s ‘Stores’), it’s branded its dealerships as 'Spaces' and located them in the centre of cities and shopping districts for the consumer's convenience. Its first is in Oslo.
Staff at these 'Spaces' are not incentivised to sell, nor do they work on a commission basis. The idea is to provide the best possible customer-focused experience in a modern and relaxing environment, providing visitors with the information they need for them to make up their own mind.
What's not to like there?
Another example of the brand's forward-thinking nature and its stated obsession with detail is its vegan interior. Its seat covers, steering wheel, gear shift and interior coatings are all animal-free. Polestar even received a Compassionate Business Award from PETA for the move. Jeremy Clarkson hearing this news is possibly the one time I'd quite like to watch him.
And in a sign that Polestar could set the EV agenda, not just respond to it, Tesla announced a few months later that its Model 3 would become completely vegan too through the use of a new synthetic steering wheel cover.
A small victory, perhaps.
Let’s see if Polestar can push its differences further in 2020 and beyond.
Challenger to watch: Loop
Like every other person who’s, quite rightly, currently terrified about the imminent climate apocalypse, I have been taking tiny but important steps to live more sustainably – one of the first steps being cutting out single-use plastics as much as possible from my weekly shop.
But trekking down to the new unpackaged no-waste grocery shop with my jars and pots doesn’t quite fit in with my ‘Uber’s Children’ demands for extreme convenience to fit in with my busy executive lifestyle. So, I was delighted when I discovered a small local business in my area who sell essential groceries (and fancy sourdough bread and locally roasted coffee) in reusable packaging - delivered and collected for free to my door by electric vehicle.
Yes, I got a milkman.
So Chris, from Parker Dairies helps reduce our household plastic waste by at least 5 plastic pints a week – hurray! But what of the other stuff my big shop? What about the shampoo, bleach and ice cream? Why is the reuse part of the ‘reduce, reuse, recycle’ mantra not the focus of more of our packaged goods innovation?
Loop is the brainchild of recycling wizards Terracycle, an 18-year-old company operating in over 20 countries, that has become leaders in the field through innovation in recycling traditionally hard-to-recycle waste (even cigarette butts). Through a multi-strand business model Terracyle partners with hundreds of brands and companies, and works with thousands of waste collecting volunteers, to recycle billions of items globally that would previously have been sent to landfill – and it makes a profit doing it.
But we know we can’t rely on recycling alone to solve our plastic problem – and, as Terracycle founder Tom Szaky explained to GreenBiz, new thinking is needed to shift consumer behaviours in favour of reuse.
“The challenge of many reuse models is that they put reuse on a pedestal, but sacrifice the three things consumers care about: convenience; affordability and "the shiny new object," or having the new cool thing. We need to accept consumers for what they are and try to create reuse models that play into those behaviors.”
With Loop, Szaky is attempting to solve that challenge through a circular, collaborative model to encourage consumer goods brands to sell products in refillable custom-designed reusable packaging. Through partnering with the brands and retailers, the brands design and maintain control of the packaging at the beginning of its life, then Loop takes care of the collection of used products, cleaning and refilling of the packaging - and when it reaches the end of its life, they recycle it.
If Loop catches on, it could be a win-win for brands and consumers – having a specific tub for your Clorox wipes increases loyalty and frequency for the brand, and the customer gets more durable, nicer looking packaging that performs better – for example, the stainless steel Häagen-Dazs tub is designed to keep the product at the optimum temperature during transportation and melt at the perfect rate for easy spooning from the tub.
After an initial launch in France and subsequent rollout in the US in 2019 with big brand partners such as Proctor & Gamble, Unilever and Clorox, Szaky seems confident about Loop’s potential to make an impact, with both brand and consumers responding well to the pilot.
“We’ve had a brand a day join since we launched and we’ve also had really good discussions so far with retailers and brands about the level of sales and re-orders. People are not just entering the platform, but continuing to use it.”
2020 sees the expansion of Loop to the UK, Canada, Japan and Australia. The critical factor in its success will be whether the involvement and support of the goliath packaged goods companies is enough to help Loop, and initiatives like it, achieve the critical mass of scale and shift in behaviour it (and the planet) needs.
Challenger to watch: Re-inc
“We're not interested in regular. We want to be revolutionary. That's why we see the power to create as boundless and limitless. We exist to boldly reimagine the status quo—championing equity, creativity, progress and art.”
Putting aside this hyperbolic and slightly baffling string of non-sequiturs there’s definitely something very seriously up at the DTC apparel start-up Re-inc.
It’s not just the commitment to gender-neutral clothing (though that’s cool and notable they are not the first).
And it’s not just that the four celebrity founders — members of the brilliant World Cup winning, record-breaking, US Women’s National Soccer team — will be taking an active role in the running the business, as opposed to just lending their star power (they’re claiming they will be co-CEOs, testing their on and off-field relationships built over years of teamwork).
It’s the much larger cultural agenda driving the company that makes this one to watch.
“these four appear to be taking the law into their own hands with the launch of Re-Inc”
In March of last year, the US Women’s Soccer team filed a class-action lawsuit against their employer, the US Soccer Federation. The case will be heard in May this year, but the writing has been on the wall for some time now and these four appear to be taking the law into their own hands with the launch of Re-Inc, stating they want to become as big as Nike and Google so that they can affect real change:
"When you're that big of a company, you're able to throw your weight around and create a different status quo based on the values that you hold and the mission that you have," Klingenberg told Inc.
That’s great. Many successful challengers begin with just that kind of audacity. Given the enormous power that corporations hold to create this kind of cultural change and, frankly, the need for it, we’re all for it. Maybe more celebs with strong agendas will invest in themselves in this way if Re-Inc is successful.
Of course, as some have rightly pointed out they will need to make a lot more than $130 joggers to reach the kind of scale and impact they desire. And this will require them to think hard about the very real issues of supply chain and fair-trade, for example, if they are serious about “reimagining the status quo and championing equity.” That might just require all four CEOs. We wish them luck.
Challenger to watch: Aviation Gin
In 2019, Aviation Gin wasn’t only a fascinating challenger brand in the world of premium spirits… it was one of the best-marketed brands on the planet. Of course, like a lot of celeb-owned brands, it leveraged the face and name of its part-owner, Ryan Reynolds. But it also brought biting wit, opportunism and irreverence to our screens. It’s a luxury brand, earning its premium through meme-ability instead of through a long pedigree.
Reynolds, most famous for his action-comedy turn in Deadpool, is used to glorious effect. Unlike many other celebrity spirit tie-ins, Aviation hasn’t resorted to cheesy product shots (a la Bill Murray in “Lost in Translation”), nor does it belabour the Creative Director role, with some Hollywood A-Lister being filmed bothering the poor distillers who very clearly have better things to do. Peter Field and Les Binet identified “Unusual use of celebrity” and “Outlandish humour” as key strategies for generating fame, and Aviation does both of these with aplomb.
At the end of 2018, the brand skewered the industry’s ridiculous “process” ads with Reynold’s trademark sarcasm.
In February, Reynolds used his long-standing “social media war” with Hugh Jackman to create an ad, where ostensibly the Australian’s coffee company would be advertised by Reynolds, and Jackman would make an ad for Aviation in return. The ad has received over 8m views on YouTube.
In November, Aviation created the TurDuckEn of advertising by placing an ad inside a Samsung TV ad, next to a Netflix ad… Confusing? Perhaps, but a fantastic collaboration for Aviation, getting two behemoths to pay for exposure (likely in exchange for Reynold’s own cache).
But perhaps the brand’s greatest coup of the year? In December, home exercise brand Peloton’s “The Gift That Gives Back” Christmas advert went viral for all the wrong reasons. Was it misogynistic? Dystopian? Just terrible? Frankly, a little bit of all three… The internet went crazy and Peloton’s shares dropped 9% in a day (chill out, people...). But like any great challenger, Aviation saw the opportunity in someone else's misfortune, and it rode that infamy as much as it could.
Within days, Aviation had tracked down the actress from the Peloton ad and had featured her front and centre in an ad called “The Gift That Doesn’t Give Back”, which played like a sequel to the spinning brand’s own film (one where the central character had perhaps ditched the man who surprised her with an exercise bike). It earned 10m Twitter views and 5.7m YouTube views in a week, all without a cent spent on media.
What does 2020 hold for Aviation? God only knows. And that’s why I’m so looking forward to it.
Challenger to watch: Extinction Rebellion
An agile, responsive, non-hierarchical, inter-connected global network that is purpose-driven and impact-oriented, Extinction Rebellion is efficient and effective, resourceful and imaginative, inclusive and constantly evolving.
And most importantly, it’s put the climate crisis firmly on the agenda. A recent YouGov poll points very clearly to the protests by Extinction Rebellion last April as a critical factor in a significant shift elevating the environment to one of Briton’s top priorities.
So how has XR, founded only fourteen months ago, made such an impact in such a short space of time? A little analysis suggests its behaviours are strikingly similar to that of a challenger brand.
A new kind of contract
Extinction Rebellion broadened the appeal of street protest, encouraging large numbers of people to take part in activism and civil disobedience for the first time. It's even seen ex-police chiefs join the movement.
Its approach is data-driven. A study by Erica Chenoweth, a political scientist at Harvard University, found that protests engaging 3.5% of the population (which would be around 2 million people in the UK) have never failed to bring about change. The same study also found that nonviolent protests were twice as likely to succeed as armed conflicts.
It's this fascinating historical data that's informed XR's strategy to bring about change. To engage 3.5% of the population, it has to broaden the appeal of environmental activism. It needs to appeal to anyone who thinks the earth is worth saving.
“By creating this new code of conduct, XR has encouraged and opened up access to large sections of society to join the cause.”
To put its plan into action, a new written contract of organisational behaviours called The Rebel Agreement set out how the movement and its members should operate and behave. Its articles include 'engage in no violence', 'bring no alcohol or illegal drugs' and 'take responsibility; we are all crew'.
By creating this new code of conduct, XR has encouraged and opened up access to large sections of society to join the cause.
And while the mainstream media and much of the subsequent conversation about XR focuses on the number of people prepared to be arrested, the range of activities on offer (including breastfeeding mums, old people’s choirs, workshops and talks) attract families with children, young people and older members of the public who would not be considered the ‘usual suspects’ associated with previous protest movements.
XR wrote new 'rules' for protest. But it also did something quite radical with its brand.
While corporate logos are fiercely managed and protected, the power of XR's logo has been through its flexibility and democratisation.
The logo, an encircled hourglass symbol representing the dwindling time left to tackle the climate crisis, can be drawn and understood, in seconds, and its reproduction is encouraged by XR.
"All our design and artwork can be used non-commercially for the purpose of planet-saving" reads the website.
Copyright goes out of the window when the world is on fire.
The logo has been projected on to The House of Parliament in London, moulded into a sand sculpture on Mount Maunganui beach in New Zealand and formed from flowers in the Universidad de Antioquia in Medellin, Colombia.
The logo's designer, ESP, told Eco Hustler, "The issue was so big that I couldn't do this alone, and therefore it needed something simple that anybody could easily replicate."
It’s used drama effectively
Whether it’s the pink boat, the red brigade, or the pools of fake blood, Extinction Rebellion use drama and theatre to make messages travel far and wide.
At the height of London's 'Spring Uprising' in April 2019, XR's pink boat, a symbol for rising sea levels, became a central character in the story. Docked in the middle of Oxford Circus, and stopping all traffic, it became a large-scale and visible indicator of who had control of London's streets, the police or Extinction Rebellion.
“These theatrical symbols demand attention.”
After five days at the centre of one of the UK's busiest intersections - and of much of the media coverage - the pink boat's ultimate confiscation by police became headline news.
These theatrical symbols demand attention. They become the central characters in the story, providing the focal point for the images and news stories that get shared around the world.
It's smart, effective, mass-market advertising on a shoe-string budget.
What can we expect in 2020?
Extinction Rebellion has had a significant impact on the political agenda since its launch in October 2018. The UK parliament has declared a climate emergency. And the Dutch Supreme Court has ruled that the government must act to protect its citizens from the effects of the climate crisis. But governments have taken little concrete action to combat climate change, and there’s still much work to do.
Challengers don’t move forward by standing still, they have to keep reinventing themselves. XR understand this. ‘We’ve made mistakes [...] we need to do things differently’ it says announcing a refreshed strategy for 2020 on its website. Watch for a more revolutionary, and more democratised, rebellion this Summer.
Challenger to watch: Beco
Beco is a soap company; a Better Considered soap company. Launched in 2018, it uses only natural ingredients, it’s environmentally friendly, and 80% of its staff are disabled. And that’s where it gets interesting. Because Beco doesn’t just hire people with disabilities – it wants everyone else to as well.
There are 1 million disabled people that want to work in the UK, but can’t get employed – that’s approximately 95% of disabled people. And the disability employment gap (how many disabled people are employed compared with non-disabled people) has barely changed in 10 years - mainly because many people think that hiring disabled people is more complicated, time-consuming, or expensive. A YouGov poll found that 50% of HR decision-makers believed it was easier to hire a non-disabled person.
About 100 of Beco’s staff are disabled, so it’s doing much better than most companies at hiring disabled people. But while it can pat itself on the back for being an inclusive employer, 100 people aren’t that many when 999,000 more disabled people are looking for work.
So Beco is asking people to steal its staff.
The soap company encourages businesses to hire more disabled people by pinching someone that already works at Beco (because it’s nobody’s dream to work in a soap factory). Beco can then continue to hire & train more disabled people who are struggling to enter the workforce.
Through the ‘Steal our Staff’ campaign, Beco isn’t just challenging the idea that disability is an obstacle to employers. It’s challenging how we present & talk about disability in the first place.
Not only are the CV’s of staff available for hire on the Beco website - featuring personal recommendations, key achievements, and qualifications - but they’ve been plastered to packs of soap too, now stocked in supermarkets across the country.
These are devoid of the worthiness you may expect from a campaign about disability – instead of focusing on how it has hindered their employment prospects, each CV highlights all the brilliant qualities they bring to their job and their career ambitions for the future.
While the campaign launched in September 2019, momentum has been growing slowly, with a TV ad airing in December (through Channel 4’s ‘Disability Works’ initiative). The spot features Beco staff and playfully mocks some of the tropes of disability – including an awfully judgmental audio description, and a nod to the fact that no one knows what sign language actually looks like.
With at least one disabled employee already hired (but whispers of more), we look forward to seeing how many staff have been stolen in 2020.
Challenger to watch: Playstation
Where most consumer technology fits a now rhythmic cycle of annual incrementalism, there is one tech category that undergoes a spasmodic shift that changes the face of the industry forever. In the multibillion-dollar world of gaming, every seven years or so, the sector undergoes a convulsion of epic scale as one generation of hardware comes to an end and another begins. It is at this point, a new era begins, and those generational winners crowned, and losers consigned to years of clawing back ground from behind, perhaps until they can release new hardware to catch up.
The generation that started in 2013, when Sony's PlayStation 4 and Microsoft's Xbox One launched, will come to an end in Q4 2020 when both of these juggernauts release the consoles that each believes will represent the future of gaming for the next seven years. The biggest question? Which of these futures will gamers respond to and want to invest?
At the start of these generations, the brands are really just unveiling a promise. No-one knows what games will arrive in 2026, but both Sony and Microsoft want you to feel that their box will be the best thing to play it on.
And in no uncertain terms, challenger brands are the ones that typically do the best. In the console wars, it is very unusual for the winner of one generation to be the winner of the next.
The undisputed winner of this current generation has been Sony PlayStation. The PlayStation 4 has captured the hearts, minds and wallets of over 100m gamers across the world, making it one of the most successful consoles of all time (the PlayStation 2 sold more but over a longer lifetime).
Despite being the smaller player at the time of launch (the PlayStation 3 was considered a disaster in the industry), PlayStation was able to wrestle a lead away from Microsoft by offering a vision that felt true to gaming and put 'players' front and centre. It recognised and celebrated the emotional power that gamers know about, just at a time when its main competitor Microsoft seemed to forget it.
Microsoft's greatest error was in seeing the Xbox not as a gaming platform but as "the key to winning the living room". Gamers were immediately put off by a box that seemed to put expensive gimmicks and the ability to control your TV ahead of what they really wanted: a system that allowed them to feel extraordinary. Widely panned, the Xbox One has spent seven years in the doldrums. One cannot see Microsoft making the same mistake twice.
On top of that, the gaming market seems more fragmented than ever before. Google offers its "console-less" solution in the form of Stadia (though its launch has been underwhelming, to say the least). Nintendo's Switch has proved incredibly popular too, giving casual gamers who aren't as hung up on "the best experience" a cheaper platform to enjoy some brilliant gems. Even Apple has upped its game with the Apple Arcade all-you-can-eat subscription service on devices that many of us already own.
So the big question for PlayStation - now that it's the market leader, can it win from the front? Can it channel that challenger energy into a successful repeat of its greatest achievement, and make a case for why its vision of the future is the one that we should all buy into?
Challenger to watch: Yora
I’ve spent January boring waiters to tears with my restaurant orders. The latest being a muffled request for the ‘Fritter 2.0 (v)’ in a place famous for its beef burgers. It might be because the world is literally on fire, but environmental concerns are rightly gaining in their share of international worry. Naturally, as we reflect on our carbon footprints, our pets’ carbon pawprints are coming under scrutiny too.
Apparently a whopping 20% of the world’s meat and fish goes to feed our 500 million pets. After one too many an emotional pummelling on Netflix, we all know that meat production is one of the biggest sources of greenhouse gas emissions.
There has been a surge in brands trying to shrink our pets’ environmental impact. Most famously Wild Earth, winning investment on America’s Shark Tank for their clean protein dog food. Although sharks may be open to Veganism, I can’t imagine my dog Noodle living off leaves alone. In an unscientific study of one, he completely ignores a dropped lettuce leaf whilst his enthusiasm for chicken bones has almost dragged me under many a bus.
Yora is challenging the notion that our dogs’ carbon pawprint needs to be so big. Instead, in 2018 they launched an insect-based sustainable dog food. They are overtly challenging the established behaviour of feeding our dogs meat or fish. Pleasingly Yora walks the walk by being green at every level - from sustainable packaging, to humanely making their larvae sleepy before blending them and using oats that are grown in a field next-door to their factory. They also claim nutritional equivalence with regular dog food, along with a dramatic reduction in environmental impact.
Ultimately the real test comes from the four-legged experts themselves. And so, I tried it out on my notoriously fussy dog Noodle and so far, no complaints. We’re six days in and he’s still chowing down. This sentiment is echoed loudly in the brand’s feefo rating of 4.8 from 222 pets and their people (6th Jan).
Yora comes from seasoned retailer Pets Corner which should mean they can move faster than your average start-up. In 2020 it will be interesting to see which growth opportunities they pursue, be that ranges for different pets or expanding to other geographies. Given the volume of the climate emergency, Yora might be one of the first challengers in this space, but I envisage others, including the big brands, will swiftly follow. From a challenger perspective, that means Yora could do with further amplifying their differences and being prepared to shout a bit louder about the monster they are fighting.
Whilst I’m still feeling rather January-ish, Yora’s name, stemming from an ancient proverb, resonates with me. It means ‘walk softly on the earth taking only what you need’. It might be a bit earnest for a tattoo, but it is probably a pretty good new decade’s resolution and since Noodle can’t talk yet, we’ll have to presume he agrees.
Challenger to watch: Petit Pli
Petit Pli is a wearable technology company. It combines technical materials and innovative garment design to create children's clothes that grow with the child between 9 months to 4 years.
After being frustrated with gifted clothing quickly becoming too small for a new-born nephew, graduate Ryan Mario Yas founded Petit Pli in 2017 to address the problem. Evolving from Ryan's thesis project at the Royal College of Arts, his studies of aeronautical engineering inspire Petit Pli's designs.
With the fashion industry being the second-largest polluter in the world, fast-fashion become a talking point in 2019 and documentaries such as Stacey Dooley's Fashion's Dirty Secrets have helped bring the issue to broader public awareness.
Petit Pli challenges throwaway culture in childrenswear. Using recycled and recyclable materials, manufactured in a factory powered by solar panels and creating less clothing waste – Petit Pli has sustainability at its heart, driven by the belief that slow-fashion is the future.
As part of its broader social ambition, Petit Pli hope to highlight the importance of durability and long-termism of clothing as something children then carry forward into their adult life.
Framing their brand world around the 'LittleHumans' as an adventure to the moon, Petit Pli's range has been designed for children from the ground up, "not just miniature adult clothing" as Yasin explains.
Petit Pli's fight for change in the fashion industry is clear, tangible and ultimately fun with a real product rock and strong brand point of view. Petit Pli believes slow fashion is the way forward with a goal of embedding sustainability at all aspects of the product lifecycle where possible. As Dezeen design of the year award judges put it - "A sustainable yet elegant design for the most important people in the world."
Each user touchpoint reflects the sustainable future-facing company. As an e-commerce company, customers receive the item of clothing in a box that folds into a cardboard jetpack, turning what would've been a piece of packaging waste into a toy for the child – transforming them into a mini astronaut in their stretchy spacesuits. It's a brilliant and intelligent example of 'house media' from NB Studio's rebrand.
It takes a multi-disciplinary team to challenge the norms and question conventions, and Petit Pli is driven by a force of product designers, neuroscientists, sociologists and fashion designers creating the future of technical and sustainable clothing. Petit Pli is definitely one to keep an eye on while it continues to challenge the traditional ways in which we buy, own and wear clothing.
Challenger to watch: Welly
A staple of the challenger playbook is to introduce a new dynamic or energy to a category stuck in its ways.
Method changed how we thought about cleaning products - making them a thing of beauty. Hello has been challenging the culture of "Oral Scare" in Oral Care by instead using friendly and encouraging language. Lemonade insurance has brought humanity to the world of insurance.
In a similar vein, Welly, a new brand launched last year in the world of First Aid (exclusive to Target), is bringing some joy to the world of plasters. The brand is all about turning the conventions of the sterile personal care category on its head. Instead of multi-packs, Welly offers "Bravery Badges", "Oops Equipment" and "Human Repair Kits".
It's enabled them to distance themselves from the humdrum world of plasters that we're all familiar with.
But, why is this a challenger to watch? Well, not for Welly on its own, but for an interesting trend it represents.
Increasingly, large companies and VCs are recognising the incredible potential of smaller challenger brands to take on incumbents. Our latest book, Overthrow II (available now from all good bookstores, and a big bad one too) highlights this.
Both Verlinvest and The Craftory, with over a billion dollars in investments each, are dedicated to finding and developing the next wave of challengers, both believing that the time of "bigger means better" is over and that consumers are turning more and more to brands trying to overturn the status quo.
This belief appears shared by the leaders at Target. In the last few years, we have seen the large US retailer develop somewhat of a challenger strategy of its own. Where its aisles were once stocked with the giants of various categories, Target has now partnered with a number of smaller challenger brands to offer valuable shelf space amongst the big boys. In many cases, these challengers are getting the prime positions that their incumbent rivals used to enjoy.
Many Target stores now have what appears to be a challenger aisle - with elaborate in-store displays for brands that are new to the high street, many of whom were solely distributed direct-to-consumer up until now.
On top of that, Target is intentionally branching into private label challenger brands, instead of own-brand products. Brands like Welly are helping Target to intentionally buck the trend for large retailers to offer cut-price discounted brands that look and feel like the bigger brands you know (in stores like CVS, own brands use the same packaging and color palettes as the brands you know). Target is instead building challengers from the inside.
Why is this? Well, speaking to Quartz in 2018, then Chief Merchandising Officer said: "We differentiate Target by developing and curating new, innovative products and exciting new owned brands, which deliver an unbeatable combination of quality and price".
In a retail environment that is increasingly defined by e-retail and the dominance of Amazon and Walmart.com, Target is betting that it can curate a range of products and in house brands that can become customer favorites. If these brands take off, they can insulate them from the price pressure e-retail creates.
It's exciting to see Target put such a premium on creative brand building, instead of mimicking category conventions. Long may it last. Have a Bravery Badge.
Challenger to watch: OLIO
Globally, over a third of all food produced for human consumption, worth over $1tn, goes to waste each year. It’s a global issue that OLIO is tackling by tapping into the sharing economy and trying to normalise sharing perfectly decent but unwanted food. OLIO want us to share more and waste less – a very simple message with potentially huge benefits.
What is OLIO?
An app that allows people and businesses to share surplus food rather than see it go to waste, OLIO was founded in 2015 by Tessa Clarke and Saasha Celestial-One, whose mission when they set out was to ‘to eliminate avoidable food waste in the home and the local community’. The food-sharing startup has now raised over $10m in funding, has 1.7m users across 49 countries and recruited over 40,000 super-fans to help them on its mission.
Tackling food waste is a necessity
The climate emergency is firmly in the cultural consciousness and individuals and businesses are making plenty of necessary steps to reduce their environmental impact. We are moving to a world of electric cars, living plastic-free and going vegan, so it seems crazy that more attention is not being paid to reducing our food waste – particularly when you hear the size of the issue.
- All the world’s nearly one billion hungry people could be fed on less than a quarter of the food that is wasted in the US, UK and Europe
- 25% of the world’s fresh water supply is used to grow food that is never eaten
- If food waste were a country it would be the 3rd largest emitter of greenhouse gases (after China & the USA).
Perhaps one solution to the environmental crisis could start by looking in our fridge?
Stop being weird
Rather than lead with the environmental case, OLIO is taking its message to communities with a simple provocation – when did sharing food become weirder than wasting it?
At a time when we are happy to rent homes from strangers and ride-share in the name of saving money, it seems so odd that we wouldn’t share surplus food with strangers whilst doing good for the environment, too.
OLIO is doing what many challengers do, which is to create an entirely new category. In this case food-sharing. And by challenging the culture surrounding wasting food, it is trying to normalise what may seem an alien concept and behaviour to many.
As Deliveroo and Uber Eats battle it out for food on demand, why shouldn’t we look to our neighbours first?
To spread the word, OLIO has developed three tiers of volunteers – Ambassador, Food Waste Hero and Squad Starter – to help it build relationships with businesses and build local communities. All brands want their super-fans to help them recruit new users, but this pro-active recruitment by OLIO has been so successful that at one time, the team struggled to process all the requests they were getting.
By tapping into the sharing economy model, with some clever recruitment tactics and a dollop of humour, OLIO is creating a new category for themselves that happens to do a lot of good.
2020 may be a big year for plant-based, but for OLIO and local communities across the world, it could well be the year for zero-waste too.
Challenger to watch: Bumble Bizz
Bumble’s new brand extension, Bumble Bizz hopes to combat the dark side of online networking by putting the power back into the hands of women. Vice recently highlighted how the networking site LinkedIn is frequently used by men to hit on people.
Like it’s parent Bumble, Bumble Bizz is a women-first platform as women make the first move to complete the connection.
Wanting to redefine what it means to network, Bumble’s founder Whitney Wolfe Herd was keen to reinvent ‘swiping’ and disassociate this from dating apps. While universally acceptable, swiping can be seen as disposable and visually lead. Though Bizz is forcefully trying to take swiping into the networking category, I would be lying if I said I was genuinely comfortable swiping away at my desk as the interface doesn’t differ much from the dating app.
But Bizz isn’t just about the swiping. What piqued my interest in the platform was how the network is growing beyond our phone screens. Wolf-Herd often talks about how its users want experiences, rather than products, creating a broader brand ecosystem, which touches lifestyle and culture.
Bumble Date, Bizz and BFF have manifested physically as co-working space, a yoga studio, a conference centre and a café, and cleverly labelled ‘Hives’. Collaborating with women founders and entrepreneurs, Hives have popped up in NY, London and LA. As an extension of Bizz, Hives offer immersive sessions with women in business as well as space to network.
Bumble’s strategic partnership with Serena Williams as Global Advisor has allowed for the personification of its DNA and beliefs. As an ambassador for the brand, Williams is a guest speaker at many of Bumbles events, even featuring in Bumbles Super Bowl ad that finishes with the line, ‘ladies, the ball is in your court’ (i.e. make the first move). Bizz’s other collaborations have turned into investments. Priyanka Chopra-Jonas invested in 2018 to assist with Bumble Date, BFF and Bizz expansion into India.
In a world of scrolling for miles on LinkedIn, Bumble Bizz is a refreshing way of networking without the Facebook-like updates of jibber-jabber from that friend you had at Uni.
Even if it isn’t Bumble Bizz that cracks the next generation of networking, I think there is white space for something exciting to breakthrough here.
Challenger to watch: The Athletic
Netflix pioneered the subscription model for TV and film. Spotify did the same for music. The Athletic is now banking on repeating the trick for sports journalism.
A website and app that provides access to some of the world's best sportswriters in a simple, pared-back and ad and sponsorship-free reading experience, The Athletic’s subscription-based service costs £9.99 ($10) per month or £59.88 ($60) for the year.
The sports media upstart has raised $139.5m of investment since launching in 2016 with its founders and backers adamant that fans will pay for sports writing if it's of the very best quality.
After launching in the US in 2016, it debuted in the UK in 2019 with Premier League football coverage, and even before launch, was causing controversy. For a challenger in a new market needing attention quickly, that's no bad thing.
A rapid and aggressive hiring approach saw it poach talent from its larger and more established media rivals, luring them with the offer of equity stakes and reports, in some cases, of doubling salaries (something The Athletic has denied). Big-name signings in the UK include experienced, tier-one journalists Oliver Kay from The Times and Amy Lawrence and Raphael Honigstein both from The Guardian. The bullish hiring strategy sent shockwaves through sports media with one broadsheet calling it a 'raid on the newspaper industry'.
It's 'disruption'. But not as we know it. This one seems to have been bought.
The Athletic's brand strategy appears like that of the 'Local Hero' challenger - a brand championing the importance and cultural differences of local needs and offering a deep presence in, and understanding of, those communities. It hopes by providing excellent quality content for lesser-known, regional sports teams, not just a handful of the biggest and most popular teams nationally, it can set itself apart from the media incumbents.
In the UK, this means a dedicated football writer for each Premier League side. "If no-one else is offering even a half-decent effort in terms of covering Southampton, or Derby County, or Leeds, then that's a huge opportunity for us," its Managing Director, Ed Malyon, told Press Gazette. It will be interesting to see how far The Athletic are willing to go with this localised strategy.
The question is, can The Athletic become famous for something other than aggressive hiring in 2020?
When sports media company Copa90 launched in 2013, it had a clear position as a brand. It was standing up for fans against the establishment fat cats of football. Copa90 offered to "Give fans their ball back" as its CEO Tom Thirlwall put it. Its stance gave Copa90 a reason to exist and provided it with a platform for its views and a filter for ideas and content. It's not clear The Athletic has such a strong position as a brand.
Perhaps a quality product and a significant chunk of VC money are enough to succeed.
But in the long-term, I wouldn't be so sure.
Challenger to watch: Rain
The top two mobile communications players in South Africa, MTN and Vodacom, collectively own more than 80% of the market. The third player Cell C accounts for a further 15%. It’s a tough market to enter considering the dominance of the main players and the investment required just to get noticed. The one thing that this duopoly has produced is a proliferation of opaque tariff-based propositions in the aggressive search for new customers and desperate attempts to reduce churn.
While the bright side of this might be ‘more choice’ for consumers, Rain, a challenger offering 5G, data-only SIM cards, has held this up as the category ‘monster’ to challenge, in launching its offering with only ONE plan.
Driven by making data more affordable and transparent for more South Africans, Rain offers no bundles, no contracts, no limits and the clincher for many – no expiry dates. “Data is a human right,” Rain’s co-founder Michael Jordaan told 702, “it costs too much in South Africa”.
One of the key tenants of being a challenger brand is the bravery to make sacrifices so that one can overcommit elsewhere. As a mobile virtual network operator (MVNO), Rain has sacrificed the benefits in infrastructure ownership and retail presence (Rain purchases are available online only and are delivered directly to customers). By doing this it’s able to overcommit on better quality connection and faster data. In addition, it can invest in value-added services like eSims and the online simplification of complex manual compliance requirements in the sign-up process (e.g. RICA - the South African regulatory requirement governing electronic communications which prove painful to the consumer).
Solving another hot topic, Rain customers only pay for data they have used at the end of a month, their data will never expire and customers never have to pay expensive out-of-bundle rates.
Some might argue that Rain is hamstrung by limited subscriber volumes but it is brewing a grand plan. The network operates in all major metropolitan areas, with 3,200 4G sites (noted, not without capacity problems). It plans to expand to 5,000 over the next two years and within four months of launching its commercial 5G network, Rain already carries 250 sites – almost equal in size to the two largest fibre network operators in South Africa – with ambitions to accelerate to 700 5G sites within a year.
A large part of Rain’s future success lies in how quickly it can lower distribution costs and manage scaled growth to keep its offering affordable and deliver better quality connectivity.
Rain amplifies its challenger stance by linking its positioning directly into a systemic social problem, that of socio-economic development. With the belief that affordable, fast broadband is key for the country to revive economic growth, Rain is committed to playing a key role in building South Africa’s 5G and 4IR ecosystem, reducing unemployment, and improving education. They’ve already started partnering with WITS University and Huawei Technologies to establish a 5G Innovation Lab and provide free data to over schoolchildren giving over 25000 young South Africans a head-start. “The more data our people consume, the better it is for the economy, the more people who have access to the internet, the better it is for the economy,” Michael Jordaan told Biz News, “we’re trying to play a constructive role in the economy and hopefully, build a really good business in the process.”
In making data more accessible and affordable, Rain offers a refreshing way to stand up for the customer and is creating precipitation for national growth.
If Rain wins, South Africa wins.
Challenger to watch: Drunk Elephant
Drunk Elephant is a growing brand of skincare products, founded by Tiffany Masterson in 2012 and operating with a mission to deliver clinically effective, biocompatible skincare, without the ubiquitous ‘toxins’, sensitizers and irritants that block the pathway to healthy skin.
Its goal is to educate the consumer that ‘natural’ or ‘clinical’ or ‘scientific’ do not necessarily mean ‘good’ and that every ingredient in your skincare products should be examined for its safety and compatibility to enable truly healthy skin.
After it was reported that the company was on track to deliver sales in excess of $100m in 2018 it was acquired by the Japanese cosmetics giant, Shiseido, for $845m in October 2019. Not a bad payday for Ms Masterson’s 7-year journey to pioneering the segment of ‘clean compatible’ beauty.
Taking a closer look at what drove the rapid rise and success of Drunk Elephant, I see four compelling reasons why Drunk Elephant is a bona fide challenger to watch in 2020:
An authentic founder’s story
Drunk Elephant was born out of personal frustration. Its founder, Tiffany Masterson's skin was prone to breakouts and her T-zone - the forehead, nose, brows, lips and chin, was often oily. "Nothing ever really worked, and if it did, it wasn't for long. I started…teaching myself about ingredients, how skin reacts to them, and what roles each play in a formulation," Masterson says on Drunk Elephant's website. "I identified ingredients that were at the root of my issues. I couldn't find products without [those ingredients], so I decided to make them myself." It's a classic case of a founder looking at an industry with fresh, naïve eyes, and spotting an opportunity to address an unmet need in the market.
Creating a new category
Drunk Elephant created an entirely new category of ‘clean compatible’ products, in which it is really the only option to choose, rendering the rest of the competition as ‘incompatible’ with the pursuit of healthy, natural skin. It’s an excellent example of a challenger changing the rules of engagement in a way that gives itself a substantially disproportionate competitive advantage.
Doing more with less
According to Masterson, she didn’t have the resources to hire an agency to develop the brand, identity, logo or icon. Instead, she decided to sit down at the table with her young daughter, some paper and a sharpie, and she pledged to start drawing until she came up with a logo/icon that felt right. Masterson embraced the constraints of no budget, no time and no drawing experience, and found an opportunistic way to create what has become a distinctive and remarkable brand logo and icon. The next time you consider investing millions of dollars with a brand naming or design agency, you might just consider first taking the same approach Masterson did – try to generate a name and logo yourself that ‘just feels right’ and see if you can create an equally compelling idea and solution.
An “800-pound Elephant”
There’s no question that Drunk Elephant has established itself as a successful challenger brand and business. Not many start-ups or emerging challengers can achieve $100m in sales in just seven years or achieve a purchase price with a 7-8x multiple on sales. Which begs the question – will Shiseido allow Masterson and her team to continue to build and develop the brand in line with the original mission and ambition? Or like too many other corporate acquisitions, will Shiseido impose its own set of rules, conventions, habits, routines and culture on the Drunk Elephant team, running the risk of undermining the brand’s momentum and remarkably distinct point of difference and culture. The stated ambition is to build Drunk Elephant into the next $1bn global beauty brand – we’ll be watching with great interest in 2020.
Challenger to watch: Back Market
The past few years have been big for sustainability. We’ve finally woken up to the environmental dangers of, well, everything – meat, single-use plastics, air travel, fast fashion, you name it.
But while we’ve been bulk buying oat milk and donning parkas made out of recycled plastic bottles, we have remained conveniently blind to the damaging impact of our shiny new iPhones.
Not only do they produce a staggering amount of e-waste (less than 1% of smartphones are actually recycled), but the vast majority of their environmental impact comes from production, not use – buying one new smartphone uses as much energy as using & charging one for a decade.
Point is, our hunger for the latest and greatest in tech is killing our planet.
And this is where Back Market comes in. It’s on a mission to clean up the dirty world of tech, by challenging the disposable way we buy and use electronics.
There’s always been a certain ick-factor to buying second-hand tech, with most resale sites offering Vantablack levels of transparency. Apparently ‘like new’ is open to considerable interpretation, prices are inconsistent, and there’s no guarantee your purchase will last longer than the first charge. No wonder 80% of Americans say they wouldn’t ever consider buying a second-hand smartphone, in large part due to mistrust.
So Back Market is overhauling the second-hand buying process, by acting as the slick face for hundreds of refurbishment companies worldwide.
For a 10% commission on all sales, Back Market ensures rigorous quality standards (all gadgets must pass a 23 point test), provides some transparency to customers on what they’re actually getting (you can buy products ranging from ‘mint to ‘Stallone’ and everything comes with a year-long warranty) and offers a user experience that aims to be as quick & easy as buying from the Apple Store.
But crucially, through its irreverent tone and slick visual identity, Back Market has transformed buying second-hand from being second-best – and perpetually focused on value – into a point of pride.
So if sustainability was ‘big’ in 2019, it will be meteoric in 2020.
And while Back Market has been successful in Europe (and is growing in the US), it will be interesting to see how it fairs as some of the big boys start to dabble in refurbished tech. Giffgaff in the UK is one of the first carriers to take refurbished phones seriously, but it certainly won’t be the last. We’ll just have to see whether Back Market’s message of ‘refurb and proud’ can weather a little more competition.
Challenger to watch: Hireup
The disability sector in Australia is broken. For decades now, third party agencies are responsible for connecting people with disabilities to support workers in an expensive and inefficient system.
The founder of Hireup, Jordan O'Reilly, experienced the failing system first hand. Support workers were an ever-revolving door for his younger brother Shane with Cerebral Palsy. His family - and importantly Shane - had no control over who would arrive at their home on any given day.
It was a system equally disempowering for support workers who were often unsure of the needs of the people they would be supporting that day, and how they would be able to help - not to mention inflexible working arrangements and low wages.
Jordan, seeing the rising capability of matchmaking technology to connect people based on shared interests – asked himself why couldn't the same tech be applied to disability support?
The result in 2015 was Hireup – a for-purpose business centred on a digital platform which allows people with disabilities to find, hire and manage their own support workers. They can match with people who fit their needs and share their interests, creating stronger relationships. And for support workers, they can manage their own schedule, earn industry-leading wages and have much more flexibility and control over their time. All this results in creating more meaningful matches and rewarding work.
The focus of Hireup is on building real relationships with connection first, care later. And with this philosophy, Hireup has created 35,000 support connections, facilitated 3.6m hours of support and saved its users $27.4m.
This success has seen Hireup recognised with several awards over the last four years, including a $1m grant from Google.org, recognition from Her Majesty the Queen for its impact on the Australian disability sector, and being placed at number one on Deloitte's 2017 Tech Fast 50 list. Hireup credited as the fastest-growing tech start-up in Australia.
Hireup's success offers proof that building community value can ultimately lead to meaningful commercial value.
2020 is the year that will see Hireup move from start-up to scale - with a slew of new senior leadership appointments from leading domestic and international tech and corporate brands.
With the rising interest in for-purpose businesses across the globe, Hireup is perfectly poised to lead the charge in Australia and beyond.
This piece first appeared on eatbigfish's The Challenger Project website.
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