Vital Farms, a company best known for its pasture-raised eggs, has built its brand on transparency, ethical treatment and quality.
So when the company decided to move into the packaged food space, it developed a product based on its core eggs and dairy that meets all of those standards — plus consumer demands for different, convenient and tasty items. Vital Farms' new Egg Bites, which are coming to stores now, serve both the Vital Farms core consumer and anyone else looking for an easy breakfast or pick-me-up, said Meghan Shookman, the company's director of innovation.
"There's a lot of convenient foods out there, but not a lot of convenient foods that our consumers — especially the Vital Farms consumer, who is really mindful of ethical sourcing and animal treatment — ...can actually feel good about," Shookman said. "So there was this void in the marketplace for convenient foods that didn't make you compromise on your core values."
Egg Bites are exactly what they sound like: 2.3-ounce bites of eggs mixed with other ingredients. They come in four varieties: Uncured Bacon & Cheddar Cheese; Roasted Red Pepper & Mozzarella Cheese; Uncured Ham, Bell Peppers, Onions & Cheddar Cheese; and Sun-Dried Tomato, Basil & Mozzarella Cheese. The bites are refrigerated and packaged in a recyclable plastic tray. They can be cooked in the microwave in less than a minute.
Shookman said the bites are clean label, featuring ingredients that all consumers would recognize. This was especially important with more consumers paying close attention to what they're eating and wanting to stay healthy during the coronavirus pandemic, she said.
Vital Farms had long wanted to go into the consumer product space, Shookman said. Previously, the company's products were limited to what consumers might consider ingredients: eggs, butter and ghee. Vital Farms was working for about a year to develop its first finished product, a process Shookman said was grounded in ways to raise the standards in existing categories while addressing consumer needs.
"There's a lot of convenient foods out there, but not a lot of convenient foods that our consumers — especially the Vital Farms consumer, who is really mindful of ethical sourcing and animal treatment — ...can actually feel good about. So there was this void in the marketplace for convenient foods that didn't make you compromise on your core values."
Director of innovation, Vital Farms
In order to research this new product, Shookman said the company talked to consumers about their breakfast routines and spent time with them in their kitchens at home. Vital Farms developed about 150 ideas, and Egg Bites rose to the top. One of the things Vital Farms heard multiple times was that freshly cracked eggs made the ultimate breakfast, but consumers don't always have time for that during the week.
"When we talked to consumers about what really got them excited, it was that once-a-week treat to a coffee shop where they'd pick up a mini quiche or something like an Egg Bite," Shookman said. "And we wanted them to have that experience and that opportunity and that option every day of the week."
It's been a big summer for Vital Farms, which went public last month. Vital Farms CEO Russell Diez-Canseco said the IPO will help raise money for Vital Farms' expansion, but it also seals the company's commitment to consumers. As a company, Vital Farms believes in conscious capitalism: making money through transparency and ethical business. Diez-Canseco said he believes Vital Farms can best serve this mission by being publicly funded and not having to be held accountable to anyone else.
Vital Farms is a Certified B Corporation, a coveted certification that shows the business holds the highest ethical values, considering all stakeholders including suppliers, consumers and the environment in its decision making. It's also a public benefit corporation, meaning its commitment to the world community at large is enshrined in its charter. Diez-Canseco said these certifications are important ways to show the world the company stands behind its mission.
The company's bet on ethics and transparency has paid off so far. The company's stock is currently trading at more than $35, representing about a 60% increase from its initial offering of $22.
Vital Farms products have a relatively low market penetration right now. According to the company's initial filing with the U.S. Securities and Exchange Commission, its pasture-raised shell eggs are in just 2% of U.S. consumers' homes.
The product launch has been in the works for about a year, and Shookman said it was timed based on when Vital Farms' retail customers were doing product resets. It's fortuitous that it coincided with the IPO, she said. Even though many consumers right now are staying home because of the pandemic and not on the go, consumers are likely just as busy while working from home and watching children whose schools and camps are closed.
While Vital Farms is still primarily a pasture-raised egg and dairy company — something Diez-Canseco said is unlikely to change — chances are good that it will develop more finished products as time goes on.
"All I can say is that we're gonna continue to invest in innovation, and you'll see us continue to expand into new, as well as existing, categories," Shookman said.