The real reason Big Food is going DTC
A tiny case study in Covid-era commerce.
The direct-to-consumer e-commerce boom has made it easy for food startups to launch, start selling, iterate, and grow quickly. These include ideas like Magic Spoon, a “healthy” breakfast cereal for adults, Omsom, a smart new take on meal starters, and Nuggs, which has shipped 1 million pounds of faux chicken nuggets over the last year.
But over the past few months, as the Covid-19 crisis has flipped everything upside-down, several of the largest “legacy” food and consumer packaged goods companies have also started to launch their own e-commerce stores, selling products directly instead of through distributors and retailers.
In late June, for example, Nestle launched a direct-to-consumer site for Chameleon, a cold brew coffee brand it acquired in 2017. In May, PepsiCo got a shocking amount of attention for launching Snacks.com and PantryShop, offering snacks and drinks from its brands like Frito-Lay and Gatorade. Kraft Heinz, meanwhile, launched Heinz to Home in the UK, selling canned foods, sauces, and weird ice cream kits.
Hi, I’m Dan Frommer and this is The New Consumer, a publication about how and why people spend their time and money.
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