Despite the slim odds of success new food and beverage brands face, and declining sales in the overall cereal segment, Viki’s Granola took off with sales consistently growing 500% each of the past four years. It also secured national distribution and the honorable title of the second fastest growing cereal for the past two years, in part because Sater said she literally followed textbook examples for success, but also because she charted her own path when necessary.
Her success is the stuff of the American dream – fueled by passion and entrepreneurial spirit. But Sater acknowledges she has had her fair share of sleepless nights and nightmares since the company launched in 2010.
Her first major challenge, and the one that stops many new brands from getting off the ground, was convincing retailers to stock her granola in an already crowded and declining cereal segment.
“It never said in the business book that I read that there is no shelf space and that someone has to go in order for you to get on the shelf,” she lamented.
This likely was why Whole Foods Market declined to stock Viki’s Granola for the first eight months of the business. But eventually Sater’s cereal broke through when a buyer found a bag of the granola on her desk and tried it.
“She tried it and loved it so much that she called the 1-800 number on the back and brought it into all the Whole Foods regions,” Sater said.
And with that she learned the second key lesson to launching a successful food and beverage brand – the product must taste great and be sufficiently distinct from competitors’ products.
“The taste really sets us apart from most other granolas,” she said, explaining that her granolas are significantly less sweet than most other brands, with only a kiss of honey or maple syrup.
She also bakes her granola to a golden brown, unlike other brands which she says appear pale and undercooked. In addition, her granola is unique in that it doesn’t have clusters, which Sater says can be difficult to eat when mixed with yogurt.
The brand also taps into consumer desire for clean ingredient decks, with each of the five flavors featuring only seven ingredients – none of which are tapioca or other binders and fillers found in some other granola. In this regard, the brand also was able to access the larger trend of healthier eating, Sater said.
This desire for more nutritious, less processed food is a blessing and curse for the larger cereal segment, she added. She explained, that many consumers are turning their backs on traditional cereal because it is often high in sugar but low in nutrition and long-term satiety compared to granola.
Indeed, granola is one of the cereals that has actually seen shelf space expand in the past few years from only about four feet in many stores to eight to 10 feet, Sater said. She explained this is because consumers view it as a healthier alternative to some traditional puffed and flaked cereals.
Great taste alone is not enough
Having a great tasting product alone is not enough for long term success because it doesn’t drive initial trial. For that, Sater says, products must have beautiful packaging and sufficient marketing support.
Viki’s Granola comes in “crisp, clean white” resealable pouches that symbolize the clean ingredient lists and standout for their simplicity among the bright colors of most competitors, Sater said.
The bags also have clear windows so that consumers can see the granola, including the significant number of nuts and dried fruit pieces.
The bags also feature a bold checklist of the product’s trendier attributes, including no preservatives, sodium-free, whole grains, dairy free, high energy and others.
Certifications adds sense of safety
The granola also is certified Kosher, gluten-free and Non-GMO Project Verified, which Sater says does more than reassure only people with dietary restrictions. They also reassure all consumers that cereals have been thoroughly inspected by multiple reviewers and are safe to eat.
“The certifications provide one more level of security and people like that. They feel more comfortable buying a product with multiple certifications” that show the product meets multiple standards, she said.
Marketing strategy
Sater ensured her granola’s year-over-year growth and place on store shelves by investing in advertising in store circulators, which she says places the product at the top of consumers’ minds when they are shopping.
In addition, she said, consumers have no qualms cutting coupons from circulators, but that they might hesitate before doing so from other media.
She explained that she advertised her granola in a well-recognized and targeted magazine, but she did not see much lift from the efforts. She suspects readers did not want to cut the coupons out of their magazines.
Going forward, she said she plans to build on her business’ momentum by launching more flavors, which some might see as a mere line extensions, but which Sater says is the lifeblood for staying on store shelves and in front of consumers.
She explained that many supermarket chains did not want to carry her granola until she had at least three flavors, which would help the brand sufficiently stand out on shelves. In addition, she said they were least interested in a flavor called “original.”
This was yet another example of something “that wasn’t in book” Sater read, she said.
With that in mind she advised other start-ups to follow textbook examples of success, but ultimately be prepared to go further and “follow their passion.”