The supply service is nicely positioned to be an arbiter of upcoming meals traits.
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For 4 years, SnackNation grew its enterprise by delivering bins of bars, chips, drinks and different meals to subscribers that now quantity tens of hundreds of properties and greater than half 1,000,000 folks working in about 5,000 workplaces, it mentioned. All of the whereas, the Culver Metropolis, Calif.-based firm has constructed a secondary income stream: gathering insights on merchandise and promoting this knowledge to the meals corporations that created them.
“We check over 100 manufacturers monthly via very discerning palates,” mentioned Sean Kelly, CEO and co-founder of SnackNation. “That is actually vital knowledge and insights to get again to the manufacturers. We, on the finish of the day, are a model builder. We wish to assist these rising manufacturers succeed and win.”
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SnackNation, which mentioned it grew greater than 9,000 p.c from 2014 to 2017, this yr closed a $12 million sequence B spherical led by 3L capital, bringing its whole enterprise funding to $23.75 million. The corporate additionally partnered with WeWork on its retail experiment, WeMRKT.
There are presently 4 full-time staff on SnackNation’s Enterprise Intelligence workforce, and it is seeking to rent extra folks because the platform grows. The corporate collects knowledge on each model it options merchandise from, and the Enterprise Intelligence workforce particularly works with about 50 manufacturers a month. The info is primarily used to assist corporations perceive who their key prospects are, and the way robust their model is amongst prospects.
SnackNation matches up the information it generates on manufacturers with self-reported demographic and psychographic data from greater than 500,000 prospects throughout the nation. The corporate mentioned it has virtually 5 million knowledge factors — together with product scores, model consciousness rating and shopper buy intent — on greater than 2,000 merchandise.
Pricing for these insights, based on SnackNation, can change relying on the period of partnerships with manufacturers and what number of bins their merchandise are included in. Kelly mentioned that one avenue of paying for insights is by the corporate offering “vital” reductions on its product to SnackNation.
SnackNation additionally just lately acquired one other subscription snack firm, Love With Meals, to assist it enhance its rising knowledge enterprise, the corporate mentioned. In a press launch, Kelly mentioned the acquisition led SnackNation’s “shopper perception capabilities to skyrocket, permitting us to supply statistically vital, actionable knowledge and insights in order that rising manufacturers can iterate on the velocity of the market,” including the corporate might attain a “level the place we are able to even predict class winners.”
That is vital, as increasingly more buyers flock to startups within the meals area. Since 2013, the variety of buyers betting on meals and beverage corporations has greater than tripled, based on CB Insights. Large meals corporations have additionally joined within the motion, with many, together with Normal Mills and Kraft Heinz, launching enterprise funds and incubator applications. In the meantime, ecommerce has reached a degree that many meals manufacturers might construct their companies promoting on to shoppers, as an alternative of via retailers.
If SnackNation’s wager on insights pans out, it could possibly be a useful, and extremely wanted, service within the business. It could possibly be a platform when corporations giant and small check new merchandise and/or use knowledge to provide you with new improvements.
Picture Credit score: Courtesy of SnackNation
“[Consumer packaged goods companies], similar to most public corporations, are short-sighted,” Kelly mentioned. “They are going to purchase all these manufacturers. What occurs if you purchase a portfolio of 10, 20, 50 or 100 rising manufacturers? These manufacturers additionally will die if you don’t regularly innovate and iterate them. We’re constructing our platform in a means that claims, how can we be most dear to the way forward for this business?”
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SnackNation mentioned its inner testing is in depth. As soon as a product passes preliminary check tasters, who additionally guarantee gadgets have a clear ingredient record and an appropriate nutrient profile, it is then reviewed by 5 class managers. To make its means into certainly one of SnackNation’s bins, a product has to obtain passing scores of eight out of 10 on quite a few classes from the testers, earlier than it is judged by the corporate’s greater than 150 staff.
“As a result of we style so many and see a lot knowledge, we’re fairly darn good,” Kelly mentioned.
Solely about 20 to 25 p.c of the merchandise SnackNation checks are shipped to prospects.
However the firm does not solely depend on its inner testers. The following wave of knowledge comes from house and workplace subscribers. The corporate asks prospects to fill out surveys, but additionally depends on workplace managers to fill within the gaps. Some staff might skip surveys, however folks will often voice their opinions to workplace managers. Kelly mentioned then they will present that suggestions via SnackNation’s member portal. If the corporate sees specific product is unpopular, it’s going to be faraway from circulation.
That is the information that SnackNation gives to meals manufacturers, together with any suggestions concerning style or packaging. Meals manufacturers have modified merchandise primarily based on these insights, based on testimonials supplied to Entrepreneur by SnackNation.
“We now have used the insights to enhance some flavors,” mentioned Robert Mock, co-founder and CEO of Ocean’s Halo. “The suggestions we acquired on certainly one of our merchandise helped us within the determination to discontinue that line of snacks. We share SnackNation insights with buyers, board members and retailers like Complete Meals and Sprouts.”
Tom Donigan, co-founder of Area Journey Jerky, mentioned, “The info within the shopper perception report has been superb. It is insightful, non-apologetic and actually precious for a model that doesn’t have the for in depth panel testing. … We have even tweaked a few of our flavors primarily based on the suggestions from our SnackNation shopper perception experiences.”
Lauren Brundage Mariel, CEO and founding father of Stay Love Pop, informed Entrepreneur that she discovered SnackNation’s insights and knowledge helpful.
“The one side I liked was that the model supervisor who handles your field calls you a pair months after distribution and mainly tells you the way you ranked amongst different related snacks and what their prospects considered the product,” she mentioned. “You’ll be able to’t pay for that form of uncooked information. It was extraordinarily useful to know and perceive the place we stood as a model each from a competitor standpoint and an precise shopper standpoint.”
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All of this knowledge can be helpful for one more aim of SnackNation: to create the Netflix of snacks, a platform that may advocate totally different merchandise for particular events, Kelly mentioned. These can embody “wholesome film evening, wholesome late evening munchies, drank an excessive amount of the evening earlier than and simply wish to eat snacks to make me really feel good within the morning, skipping lunch, and after-school snacks for my children that I also can eat as an grownup.”
To attain that aim and proceed rising, nonetheless, Kelly mentioned his firm at all times has to assume forward.
“As an entrepreneur you’ve acquired to be fucking nimble. You have to be agile. You have to notice that day by day one thing is new and you have to have plans and forecasts, however you’ve acquired to be prepared to maneuver away from them,” he mentioned. “When you come to grips with that and also you settle for it and also you notice that you just’re by no means simply going to have made it — it is fairly cool.”