The Value of Owning Your Brand
My latest column on AmEx Open Forum is about NatureBox, a startup founded by Gautam Gupta and Ken Chen. The company delivers full-sized packages of healthy snacks to subscribers’ doorsteps for $19.95 a month. As the mom of two young adults who no longer live at home, I loved this idea immediately. What a great way to make sure my cash-strapped and super-busy kids get a little something nutritious into their bodies once in a while. I thought of what I’d put in a healthy care package: a few Kind bars, some Craisins, maybe some Green and Black dark chocolate, and a box of Sesmark rice crackers. Gupta and Chen think along similar lines, but there’s one crucial difference.
The founders of NatureBox white label every product that goes into the boxes. In other words, they search for new products that meet their “healthy” criteria at trade shows and in the marketplace, and then partner with those brands as suppliers. Just as Trader Joe’s does, NatureBox then puts its own label on those products so that customers associate NatureBox with the new, healthy, and hopefully great-tasting food they’ve just discovered. “Where you build value is by owning the brand,” says Gupta. “We wanted to build this aspect of discovery into the model, where customers tried items they had not tried in the past, and then came back to us for more.” That seemed exceptionally smart to me, and a lesson that I can apply to my own endeavors as well. NatureBox may not have actually produced anything that goes into their packages, but what the company does own is the method of delivery, the curation, and, ultimately the deep knowledge of their customer base that will eventually allow them to expand and customize their offerings. It’s a powerful brand in the making!