The Netrush Take on Natural
Netrush Natural Products Experts Share their Viewpoints on the Industry
I had fun catching up with Netrush’s natural products experts at Expo West. Brian Gonsalves, Brittney Weissenbuehler, and Robert Principe shared their Expo West experiences as well as their thoughts on how the industry is shifting, how consumers are shopping in this space, and what brands need to keep in mind to stay ahead of the curve.
Claire: What do you think is the most defining characteristic of the natural products space?
Brittany: I want to say it's ‘thoughtfulness’. There are a lot of different vitamins and supplements on the market that are using lower quality ingredients, lost cost ingredients, or maybe made in a lab. To truly be a part of the natural products space, you have to be very thoughtful with your ingredients, where they come from, how the packaging is sourced, and so on. There's a whole ecosystem of touch from start to finish in creating a product that can be justified in the natural product space.
Claire: Do you think you’d give that same answer years ago when you started in the space, or do you think it’s ultra-important now because the category has proliferated and, with it, lower quality products are more common?
Brittany: It's always been a foundational characteristic, but it's definitely amplified over the years. It used to just be that the brand would say, “we are a premium product, we have quality ingredients – believe us.” Now, consumers want to know the details, they want to see the proof. So now it’s also transparency on where the ingredients are from, how the product is produced, how sustainable the packaging is. There hasn't been that big of an eye on those things until probably the last couple of years.
Robert: I would agree. I think now it’s shifting towards what these brands stand for – I think there is a ton of cause marketing out there.
It used to be about organic, non-GMO, gluten-free, and those are still important, but they’re kind of table stakes now. It's just what you need to be in the space. Now, I think it's hyper focused on things like regenerative practices, going carbon neutral, fair trade. Consumers in natural really want to know that people are being treated fairly and that the environment is being considered.
- Robert Principe
Claire: What other shifts have you all seen in the last several years?
Brian: I think it’s been interesting to see the brand and customer dynamic - who controlled what, and how much that has changed. The brand had the control, and then the retailer had control, and now all of a sudden the consumer has control. The dynamic has evolved over the years pretty significantly. I started in the 90s so I’m on my 25th year of this. With ecommerce, it was always direct-to-consumer in the early days – it was creating websites and getting someone to go online and order from me directly. It became marketplace, which is what we bet on, and obviously that was a good bet, but it’s going to come out of that again. And that’s what’s interesting, now it’s evolving into this massive fragmentation that’s going to happen all over the place.
Claire: What does it look like for a brand that is embracing that shift towards consumers having all the control?
Brian: Mindset is the first thing that comes to mind - fearlessness. Because you’re coming away from a model that’s very successful to a model that’s uncertain. And so, you have to have a bit of an aptitude to take that risk. I think you have to have individuals that are willing to completely redraw the lines in regard to what it’s going to have to look like, in service of the consumers. Consumers that are investing in your brand every day. And not just any consumer, but the ones that make sense from the equitable position, the ones that will be the best type of customer for the brand.
Brittney: I think another big part of that is breaking down traditional barriers of brick and mortar versus eTail versus key accounts.
Brands can’t be operating in silos anymore. You have to look at your data from a holistic perspective and really understand that your customers are all part of the brand ecosystem. I think the brands that can break down those silos and approach their business from a true omnichannel perspective, and use the right data to understand that, will be the ones that emerge as the leaders in the future.
- Brittany Weissenbuehler
Robert: One more big shift I’d call out is the independent nature of the industry back then, compared to where we are today. I remember the first big acquisition of a natural brand was when Procter & Gamble bought New Chapter, and everybody was like, “what is going on?” Now, almost everybody is owned by a big guy.
Claire: Is that a good thing or bad thing?
Robert: My take on it is that I want the most amount of people to have the most access to healthy foods and quality supplements. Before the mass migration to big box and grocery, back around 2012 or 2013 there were only 300 Whole Foods nationwide, I think 200 Sprouts, and even less Vitamin Cottage, and then everything else was mom and pops. So, my opinion is the growth is good as it gives consumers more access. And it leads to more scrutiny, which some people don’t like, but I do. I think the cream really rises to the top that way.
Claire: Do you think consumers care about the independent versus big CPG owning these natural brands? Or independent retailers versus big box?
Robert: I think consumers care a lot less than people who work in the industry. I think the consumer just thinks, “hey, I could get a 25% off on Amazon. I could hit Subscribe & Save and buy it for my whole family, and I could just keep it moving. So why not, right?”
Claire: So, we’ve spent some time talking about the shifts in the industry from 10+ years ago, to now, such as cause marketing and the connected consumer, and where the consumer is shopping for these products. Is this what defines the industry over the next several years as well, or is there anything else you guys can see on the horizon?
Robert: I think it's just going to get deeper and deeper into causes. There will likely be new causes and trends, along with a continuation on what we’re seeing now, like carbon neutral and regenerative practices. Diversity, equity, and inclusion is something that's popping up. I mean, it's permeating throughout our entire society, so why wouldn't it come to an industry that prides itself on being progressive, right?
And I think we’re just getting started with the connected consumer too – hyper-focused marketing practices and meeting the shopper every single place they are. That’s just going to accelerate the category. And as long as people are making enough money to buy these premium brands, I don’t see it slowing down.
Brian: One other thing I would add is this massive connection between transactions and then media and education, and how consumers are getting trained on the product. This is another example of what was historically physical, face to face. Now it’s becoming more digital, and social, regarding who is training and educating the consumer. That’s a super interesting one to watch evolve and has some big implications that brands have to work through. And hopefully we’re helping them work through it too.
Claire: Alright, enough with the hard questions. How much fun is it to be back after missing it the past two years?
It was amazing to be back at Expo! As soon as we got out on the show floor everything felt so familiar and just right. The energy was a new level as everyone was so glad to be back in person.
- Brittney Weissenbuehler
Robert: It has been incredibly fun being at Expo West again! Seeing all my industry friends, popping in on my favorite brands and seeing all the smiles. This is why I love what I do.
Brian: Commerce is community. It was great to see people, converse, catch up. It had been a long time. We know that the natural products sectors is a mission-driven sector, which makes it a powerful force for the intersection of commerce and better lives. That’s what drives Expo.
Claire: What trends or brands stood out to you most on the floor?
Robert: Trends… Water. I mean, how many different ways can you market water?
Brittney: All the beverages are what I noticed most as well. So much sparkling water, electrolytes, and alcohol-free drinks pre-packaged and ready to drink.
Brian: Stepping away from the products for a minute, what I learned from connecting with brands on the floor is that brands are catching up.
The great leap forward in commerce during COVID was a customer-driven one. We caught up with each other at Expo which is great, but now we need to set our sights on catching up with this changed consumer. Behaviors changed, priorities changed, needs changed.
- Brian Gonsalves
At the same time, marketplaces continued growth and reach while advertising costs also increased. Brands need to be hyper focused on catching up with the customer. How have they changed? What is now driving loyalty?
Claire: What gets you guys most excited about the value that Netrush brings to brands navigating in this space today and tomorrow?
Brittney: I would point out our data. We're building out a ton of tools to tackle this massive question mark of ‘who is my omnichannel consumer?’ We're taking that question head on with our tools, and we’re working with the right brand partners to answer it together.
Brian: I also think data-informed innovation is key right now. Innovation suffered during COVID, and that was apparent at Expo this year. As investments in new products increase, brands that use data will be faster to market with products that add more value to customers. That’s why we used these past 24 months to develop our Customer View toolkit - providing brands with a higher resolution view of their customer based on data. Listening to customers in this way is already already helping our partners deploy smarter marketing investments and more relevant content.
Robert: For me, I think a lot of it is rooted in having experience on both sides of the desk with Netrush. On the brand side, I was one of Netrush’s first full-service Amazon partners. And if you go back to the marketplace in 2012 and 2013, the natural industry had never seen anything like it. The mom and pops and the Whole Foods of the world would complain about no pricing control, being undercut, and so on, and brands just kind of shrugged their shoulders. They’d say, “It’s Amazon. It’s the wild, wild west. We can’t do anything about it.” But we said you can. And it wasn’t easy rolling out our MAP policy and taking the action, but it worked. So, seeing the progress from there to now and seeing that MAP policies and part of the onboarding process, with Netrush and the brand both kind of signing off and saying that they’re all in. I think that’s fantastic.
And also personally, I just love the sheer number of brands I talk to and the people I meet. I get to find out what their priorities are, how we match, what their pain points are in the marketplace. It keeps me dialed in to what's happening in the marketplace. These conversations are invaluable, and the fact that they're so important and I enjoy doing them – that’s pretty cool.
Brian: I think in the near future of retail we’re going to see more instances of brands not just investing themselves but creating relationships and partnerships to jointly invest. And it’s not a fragmented relationship but a symbiotic, unified relationship.
And through those partnerships and the complexity of the space, there’s going to have to be a person, a leader in the organization, to bring it all together and unify it. And I think that’s an interesting opportunity for us – to create a system, platform, service landscape that serves that individual, that Brandrunner™. I love that aspect of it.
- Brian Gonsalves
ABOUT THE SERIESWe’re keeping up the momentum of Expo West 2022 with a limited series all about the natural products industry. Throughout the month of March and April we’ll be publishing a powerful combination of category-level data, interviews with industry professionals, and expert perspective on the most important elements of the natural products space.
See the rest of the series here.
ABOUT THE AUTHORClaire McBride leads research, insights, and education for Netrush. She has spent the last five years helping brands grow and optimize their ecommerce businesses through written research, events, share group discussions, and one-on-one consulting, formerly with Cleveland Research Company before joining the Netrush team.
