Dive Brief:
- Hungryroot raised $7.7 million to continue its push to make comfort food guilt-free, according to Fortune.
- While Hungryroot initially sold products through its website, it now offers them through Fresh Direct, Amazon Fresh, and in select Whole Foods locations as well.
- The company uses plant-based ingredients to create "healthy, easy-to-prepare versions of 'craveable' foods", according to Fortune. It sells approximately one million items per year, with popular items including almond chickpea cookie dough, a sweet potato mac and cheese and a carrot noodle pad thai.
Dive Insight:
It seems like every food company is brainstorming ways to make their formulas healthier, but Hungryroot is differentiating itself by offering strictly plant-based products in a direct-to-consumer model. The company's investment in unique flavor profiles will also help the brand stand apart, ensuring that consumers come back for more.
More importantly, Hungryroot utilizes data to test consumer demand around a new product, analyzing click-through rates, repeat purchase rates and direct customer feedback to make decisions.
In April, the company had a $6 million infusion from venture capital investors, which saw Hungryroot use the money to double its product line and expand its distribution. This new funding is believed to be directed at more innovation in an effort to compete with Big Food.
In fact, company CEO Ben McKean championed the fact that the top 25 U.S. food and beverage companies lost $18 billion in market share over the last five years to companies like his, which doesn’t subscribe to traditional company models.
Listening to consumers is important, and the advent of social media and web analytics makes it possible for brands to find out more about their behavior. Companies like Nielsen have launched services that help larger manufacturers be more nimble with testing and getting consumer feedback. However, with the more massive supply chain and manufacturing commitments that mega-companies have, it will be hard to match the speed of a startup like Hungryroot.
However, analysts have cautioned against rushing products to market and working to innovate beyond all costs. Speed can help a manufacturer be the first with a product, but there may not be the time to make that product high quality. More data can help a manufacturer perfect a product, but taking the time to develop a new idea before launching might be the best way to go.
As Hungryroot continues to grow, it will be interesting to see how its innovation model grows with it. If the company can keep utilizing direct feedback and analytics to make immediate changes, it could show the industry a new path to consumer satisfaction.