Danone has shuttered their UK high-protein, almond-based breakfast bowl brand AYEM (pronounced AM) but they’ve launched two new brands in its place: Marty’s Universe (a line of kid’s allergy-friendly chickpea snacks and frozen desserts) and Booj (a line of spirulina shots).
Kraft-Heinz has quietly launched a new brand at Walmart, Hy-vee and several other retailers called Launch Box. The frozen sandwiches are basically meat and cheese version of Smucker’s Uncrustables (whose ‘sealed crustless sandwich’ patent was rescinded in 2008). The sandwiches are available in four flavors: Poppin’ Pepperoni and Jack, Jumpin’ Turkey Jack, Slammin’ Ham and Colby, Kickin’ Chicken and Cheddar.
Kraft-Heinz has also launched a new brand of frozen plant-based meals called Fat Rabbit. The vegetarian bowls are comprised of veggies, legumes and grains and are a good source of protein. Flavors include: Lemon Feta Frenzy, Harvest Hooligan, Green Riot Verde, Smokey Mole Madness and Orange Cauliflower Renegade.
Nestle has also launched a stealth brand of their own: Host & Platter. The line consists of upscale flavored appetizer empanadas with flavors like Chicken & Red Mole, Chorizo & Mango Aji Amarillo Sauce and Chocolate & Warm Cinnamon and Chorizo Pork Meatballs in Chocolate Mole Sauce.  
So What? Startups rocked established CPG companies to their core. According to Forbes, since 2013, more than $17 billion in US CPG sales have shifted from large players to small ones. In fact, ‘ultra-small players’ (those making less than $100 million in annual sales) have seen the largest growth, 4.9% last year. At the same time, large player (those with $5.5 billion in annual sales) grew only 0.6%. Part of this is due to the increase in popularity of e-commerce, clearing a barrier to entry that traditionally encumbered small players from mass distribution. However, it’s also been made possible by ready access to capital (i.e. contract manufacturers), consumers’ willingness to trust unknown brands and the rise of ‘discovery/treasure hunt’ channels (like Costco and Trader Joes).  
Big food companies’ response to this existential threat has evolved significantly in the last few years, with recent activities indicating new thinking in the ‘Borrow, Buy and Built' model.  The first two, ‘Borrow and Buy,' have likely run their course. ‘Borrow’ (i.e. co-branding or licensing an equity to create buzz), is becoming too expensive. It drives trial, but only temporarily and licensing fees cut heavily into already tight margins. M&A (aka ‘Buy’) has also started to slow down, with recent cross-category investments (e.g. General Mills' acquisition of Blue Buffalo, Smucker’s purchase of Ainsworth Pet Nutrition) potentially signally that big players have gathered up all of the ‘low-hanging fruit’ and are looking to greener, untapped pastures. Corporate venture arms and accelerators will surely continue, but we’ll likely see a pause in major investments. That’s because, taken as a whole, many of the big CPG acquisitions were done either to stop small competitors before they became a serious threat or as a way to jumpstart a company’s way into a growing category. While necessary in the moment, these purchases were extremely costly (and risky) ways for companies to stay relevant. Instead, companies are finding cheaper, more efficient ways in—they are building.      
Up until recently, several factors have held big companies back from building new brands. Practically, developing new brands and new products often means new equipment, and many companies were shackled with innovating within the capabilities of the (old) plants they already owned. However, recent corporate downsizing has shuttered a lot of heritage factories, meaning even the big guys have been moving to contract manufacturing. Psychologically, many large CPG’s lacked the patience and temperament to build a brand from scratch. Surrounded by established brands generating $100 million+, they didn’t have the metrics and mindset in place to nurture a new brand through gestation.
However, in the last several years, something happened. A switch flipped at some HQs and people realized that a new brand didn’t have to be an all-or-nothing endeavor meant for national launch and supported with mass advertising. Instead, building a brand could be used as an experiment, a way to maximize the power of a particular channel or target a specific consumer. So, Kellogg’s launched Joybol, General Mills Autumn’s Gold, Quaker Maker Overnight Oats, and Nestle’s Wildscape; often in distinct regions, in specific channels, with little connection to the parent company. This is likely what Danone was doing with AYEM, and what they are now doing with Marty’s Universe and Booj.
However, I think we are seeing something different with these new Kraft and Nestle brands. These look less like experiments and more like retailer asks or competition blockers. Taking a page from Amazon, who has asked major CPG to develop Prime exclusive offerings, these brands (often lacking a webpage or press support) appear to be providing category buzz for key customers. This is a huge shift for big CPG, moving from thinking of themselves as a ‘house of brands’ to a ‘house of capabilities,’ leveraging their impressive resources for a retailers’ strategies.  On the other hand, these new brands could be proactive attempts by major companies to keep competitors out of the category. I can imagine a retailer’s buyer issuing an ultimatum: “either you fill this niche or I’ll find a little guy to do it,” leading Nestle to cobble together an upscale appetizer brand (lest it go to The Perfect Bite) or Kraft to make frozen sandwiches (instead of having Walmart go to Lunchwich).
Now that big CPG has learned to build and leverage their own small brands, how should startups respond?  Or what’s the next ‘Build’ strategy for big CPG ? More to come on both.

Maybe you have an active life—family, hobbies, social responsibilities—and were unaware of the chicken sandwich war that has been raging for the last several weeks. If so, let me catch you up. On August 12^th, Popeye’s dropped their first ever (!) chicken sandwich at select locations. The response was enthusiastic, to say the least. By this past weekend, the chain said they were all sold out. In Houston, a man pulled a gun on an employee when he found out there were no more sandwiches. In Detroit, an armed, angry crowd stormed a store. Celebrities have added their own drama (Gail King went to 15 locations before finding one, Popeye’s send Diplo his own stash on a private jet) and a Tennessee man is suing because he claims Popeye’s has limited supply intentionally. At the same time, Chick-Fil-A (the reigning chicken sandwich champion) has been trading barbs with Popeye’s on Twitter.
So What? Before we jump into dissecting Popeye’s recent sandwich success, it might be helpful to talk about another brand that has made a surprising comeback: Miller Beer. For the last several years, Miller (a brand that has frequently been the butt of jokes) has been climbing the charts, with Miller Lite now the #1 beer in the US. Why the surge in popularity? Perhaps its cost. Miller is on the budget end of the beer cooler, affordable even to the youngest, cash-strapped drinker. Then again, maybe its taste. While often ridiculed for its watery flavor, its bland profile allows it to be universally paired with many meals, something overly hoppy craft beverages struggle with. However, while both of these are decent hypotheses, neither are unique to Miller. Budweiser is equally inexpensive and watered down but, in contrast, it’s been struggling. So, what’s the differentiator? Shadow positioning.
We used to live in a world of subtleties. We gave brands like Coke and Pepsi or Burger King and McDonald’s our attentions and allowed them to split hairs over virtually indistinguishable products. Which brown sugar water was more refreshing? Can you spot the flame-broiled difference between two hamburgers?  We had time to listen. In a world free of social media and only a handful of channels, consumer focus was easier to obtain. Today, no one has time for shades of gray; the only thing we see is the dominate player and its polar opposite (aka its shadow).  Coke vs. Pepsi? Virtually identical. Coke vs Spindrift? That’s a radical dichotomy a consumer can quickly grasp and understand.
That’s how Miller is winning. They (and PBR) are unpretentious to craft beer’s complexity. They market themselves as ‘every man’s’ beer, while craft has started to become associated with hipsters and people who take beer a little too seriously. What started during the Great Recession with Miller poking fun at fancy beers and fancy people, has matured into a shadow positioning of clear contrasts.
Chick-Fil-E current success is the result of similar shadow positioning.  Years ago, while McD’s was trying to take down BK and Wendy’s in regards to the freshness of their beef patties, Chick-Fil-E came in as McD’s antithesis. Chicken to McD’s beef, simple ingredients to feared ‘chemicals’ and pink slime, and religiously opinionated in contrast to McD’s corporate PC policies—and of course, a delicious sandwich.   
All of this is to say that Popeye’s needs to step up their positioning game if they want to be victorious in the chicken sandwich war. Popeye’s won this round in terms of media buzz, but the ‘oops, we ran out of product’ game is only a temporary and irritating tactic. Chick-fil-A will push forward and McDonald’s is waiting in the wings with a new chicken sandwich of their own. Popeye’s must work to find a distinct counterpoint to Chick-fil-A’s positioning or risk being just another limited-time-only offer. Perhaps they could learn something from their franchisees: