One of the greatest turnarounds in history
A Swedish company struggling for 20 years drastically changed course to become a $10 Billion OATMILK brand.
This turnaround story will teach you more than a $200K marketing degree in 2 minutes.
The story of OATLY you didn’t know👇
A Swedish company struggling for 20 years drastically changed course to become a $10 Billion OATMILK brand.
This turnaround story will teach you more than a $200K marketing degree in 2 minutes.
The story of OATLY you didn’t know👇
In 1994, a company started by two brothers from Sweden created a perfect lactose-free milk alternative, oat milk, but was unable to even come close to penetrating the market opportunity.
Even after 20 years, they were a local brand in Sweden & hardly did $30M in sales.
Even after 20 years, they were a local brand in Sweden & hardly did $30M in sales.
They were struggling to make people choose oat milk in the grocery store, because people didn't even know that oats could be milked
It was competing with other plant-based options, including soy within a small market (15% of the dairy)
But things were about to change for Oatly
It was competing with other plant-based options, including soy within a small market (15% of the dairy)
But things were about to change for Oatly
In 2012, Toni Peterson became the new CEO of Oatly.
He & his team changed the entire game plan for Oatly & revolutionized the entire plant-based milk industry in a few short years with a 3 part plan.
They crafted a new voice for Oatly which was quirky & humorous but…
He & his team changed the entire game plan for Oatly & revolutionized the entire plant-based milk industry in a few short years with a 3 part plan.
They crafted a new voice for Oatly which was quirky & humorous but…
Their new game plan was to get back on the basics, with 3 major moves -
Move #1 - Changing the Packaging
Move #1 - Changing the Packaging
To give a makeover to their old bland packaging, they used block & bubble letters and spelled out "OAT - LY!" in the center.
The copy on the packaging was changed from Swedish to English - to make it more accessible to the global audience.
Why?
The copy on the packaging was changed from Swedish to English - to make it more accessible to the global audience.
Why?
Because the new packaging was bold & fresh - far more eye-catching on a shelf in the milk isle.
This move was to give a perfect first experience to its consumers and differentiate themselves from every other dairy product on the shelves in supermarkets.
This move was to give a perfect first experience to its consumers and differentiate themselves from every other dairy product on the shelves in supermarkets.
Move #2 - Positioning the brand towards sustainability & environmentally friendly.
Their core target was people for whom a plant-based diet is a lifestyle rather than a habit for health benefits.
Simply put: Vegans
Their core target was people for whom a plant-based diet is a lifestyle rather than a habit for health benefits.
Simply put: Vegans
Instead of selling milk, they decided to sell a "sustainable lifestyle"
They even authorized a report that showed Oatly is a better choice for the environment than other traditional dairy products.
The report said oat drinks from Oatly can reduce greenhouse gas emissions & land use by 80%, and energy consumption by 60%, as compared to cow’s milk.
The report said oat drinks from Oatly can reduce greenhouse gas emissions & land use by 80%, and energy consumption by 60%, as compared to cow’s milk.
With this information in hand, they went on to make bold claims about the superiority of oat milk.
They even printed it on every milk carton
I call this “educating your existing customers so they become evangelists”
They even printed it on every milk carton
I call this “educating your existing customers so they become evangelists”
Next, they launched campaigns against the dairy players
"WOW NO COW"
"WOW NO COW"
This visualization of the "Oatly way vs the Cow’s way" was to demonstrate that the nutritional profile of oat milk was better suited for humans than cow’s milk whose nutrients are naturally designed to grow a calf.
It was clear they wanted to become an "activist brand"
It was clear they wanted to become an "activist brand"
This inciting stance provoked a backlash against them.
The Swedish dairy lobby sued Oatly for it. They had an issue with the visual which they felt showed that dairy milk comes out of a "cow’s bottom, not the udder".'
Oaty actually lost the case.
But Toni published…
The Swedish dairy lobby sued Oatly for it. They had an issue with the visual which they felt showed that dairy milk comes out of a "cow’s bottom, not the udder".'
Oaty actually lost the case.
But Toni published…
… the lawsuit online, just like a true activist brand, & used the attack to its advantage.
They showed they were being “bullied” by the big, bad dairy companies and generated loads of free PR.
It got them support from people & their sales went up by 45% in Sweden.
CRAZY (!!)
They showed they were being “bullied” by the big, bad dairy companies and generated loads of free PR.
It got them support from people & their sales went up by 45% in Sweden.
CRAZY (!!)
To milk this cow in even more, they spent ÂŁ700,000 on billboard campaigns in the UK.
(The slogan was just banned in Sweden)
Everything about their brand was 'fun', & as a result, they made a fanbase.
(The slogan was just banned in Sweden)
Everything about their brand was 'fun', & as a result, they made a fanbase.
Move #3 - Penetrating the US Market through the backdoor.
They realized, their potential customers in the US are willing to pay more to avoid dairy, but they didn't know how much they would prefer oat milk over soy/almond milk so…
They realized, their potential customers in the US are willing to pay more to avoid dairy, but they didn't know how much they would prefer oat milk over soy/almond milk so…
The question was - "WHO can convince these customers to opt for oat milk?"
Oatly found the answer - Local Baristas
To attract them they created "Barista Blend" for them. It was thicker than other plant-based milk alternatives, these local coffee shops had.
Oatly found the answer - Local Baristas
To attract them they created "Barista Blend" for them. It was thicker than other plant-based milk alternatives, these local coffee shops had.
Baristas liked it because they were able to make cool designs on their cappuccinos with this thick alternative.
It also gave the same experience as foaming whole milk — so the baristas agreed to promote it to their curious customers.
It also gave the same experience as foaming whole milk — so the baristas agreed to promote it to their curious customers.
While other plant-based milk brands forgot about the middleman, Oatly doubled its customers.
The math was simple 2+2=4
If baristas recommend oat milk to people, the conversion would be a lot higher!
The math was simple 2+2=4
If baristas recommend oat milk to people, the conversion would be a lot higher!
But here's the thing - they didn't go to Starbucks right away.
They looked for coffee lovers’ favorite local coffee shops and hopped on to them.
"Go where your potential customers are" - BASICS
They looked for coffee lovers’ favorite local coffee shops and hopped on to them.
"Go where your potential customers are" - BASICS
By the end of 2017, the “Barista Blend” was available in 650 cafes in the US
The new game plan Toni & his team created finally paid off & by 2018, the demand for oat milk grew massively.
At the time, a 12-packs of Oatly that costs $50, could be found on Amazon for over $200.
The new game plan Toni & his team created finally paid off & by 2018, the demand for oat milk grew massively.
At the time, a 12-packs of Oatly that costs $50, could be found on Amazon for over $200.
In 2020, they made $424M in revenue, a massive jump of 106.5%
In 2021, it went public and raised $1.4 billion, at a valuation of a whopping $10 billion
In 2021, it went public and raised $1.4 billion, at a valuation of a whopping $10 billion
After the IPO, things have slowed a bit due to people realizing how much sugar is in OATLY but they’re still projecting revenue of $800M+
Today their products are sold in over 60,000 retail stores and 32,200 coffee shops worldwide.
This is a classic marketing turn around story!
Today their products are sold in over 60,000 retail stores and 32,200 coffee shops worldwide.
This is a classic marketing turn around story!
Things to learn from this turn around story:
- A game changing CEO is extremely helpful
- Turn your losses into opportunities (their lawsuit)
- Tailor your brand for the customer needs
- Brand positioning is everything
- Be bold & creative against rivals
& most importantly:
- A game changing CEO is extremely helpful
- Turn your losses into opportunities (their lawsuit)
- Tailor your brand for the customer needs
- Brand positioning is everything
- Be bold & creative against rivals
& most importantly:
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