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Building Brands

How August, Misfits Market, and other challenger brands thrive by breaking convention

July 26, 2022 · 8 min read

It’s easy to lose faith in a society that has such immense potential but such little follow-through on that potential. 

Discussions about terraforming Mars, replacing the Fed with Crypto, and Kim Kardashian’s opinions on work ethic happen simultaneously with debates about truly urgent issues like climate change, abortion rights, and systemic racism. 

No one company is going to drastically change these real issues for the better. But the rise of challenger brands — in both social and financial influence — shows us that businesses can improve society in their own way. While making a profit. 

For some brands, this means maximizing a tight budget. For others, it means taking on societal inequalities. For savvy challenger brands, it’s about exploiting untapped opportunities within a stagnant market. 

Whatever the motivation, the era of the  challenger brand is here. 

Too busy changing the world one sale at a time? Here’s a TL;DR

  • It’s disheartening living in a world where trivial events like trips to Mars are given the same level of attention as urgent issues like climate change.

  • No one business is going to bring about change, but challenger brands show that it’s possible for businesses to make an impact and a profit. 

  • Challenger brands are those that look at a market or societal mores and ask, “why does it have to be this way?

  • Here are 5 key lessons from challenger brands that make money and social change: 

1. August: People are ready to tackle taboo topics. Empower them with your branding.

2. Healthy Roots Dolls: Make your brand accessible by building it around deeply personal stories that resonate with everyone.

3. Misfits Market: Consumers overlook aesthetic “flaws” in the name of affordability and shared values. 

4. VFC Foods: Strategically embrace drama to bolster your marketing efforts and engage your audience.

5. MUD/WTR: People are ready to embrace new rituals that challenge firmly entrenched — even addictive — habits.

  •  The challenger brand label isn’t a gimmick. Consumers weed out inauthentic companies.

  • Want more insights on how challenger brands make it happen behind the scenes? Sign up for our On Brand newsletter.

It’s not about who, it’s about what and why

The challenger brand designation seems like a product of the digital era, but it’s not. Adam Morgan, the founder of The Challenger Project, has worked with these companies for decades.

In his humble opinion, a challenger brand is a company that:

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“Has business ambitions bigger than its conventional resources, and is prepared to do something bold, usually against the existing conventions or codes of the category, to break through.”

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Before getting into examples, it’s important you understand something — ”challenger brand” isn't interchangeable with “underdog.” It’s a common misconception that misses a fundamental component of what makes challenger brands unique: 

Underdogs are classified according to who they are up against, while challenger brands are classified according to what they are up against.

The what behind these companies isn’t solely about correcting injustices (although, as you’ll see, it often is), but about building a new way for businesses to interact with society. 

5 challenger brands making a difference (and a profit)

The 5 examples below exemplify the spirit of the challenger brand perfectly: achieving lofty ambitions that fly in the face of societal norms and conventional marketing budgets.

They aren’t afraid of pushing boundaries, broaching “taboo” topics, or setting lofty goals, because they know that consumers are increasingly value-driven and will show up for brands they believe in.

They look at the world around them and ask, “why does it have to be this way?”

1. August reimagines period care and sustainability

In a time where reproductive rights are under attack, a growing number of DTC challenger brands are expanding the conversation about previously taboo topics. 

August is a massive voice in this effort, providing high-quality, affordable period products DTC. Their what is “a world where all humans have natural needs met with quality care.”

But quality care isn’t the only thing driving August. 

They are actively fighting climate change with sustainable products, creating an inclusive community for anyone who menstruates, and reducing poverty by fighting the Tampon Tax. August’s dedication to the latter was on full display in a joint guerrilla marketing campaign with  72andSunny NY, OffLimits Cereal, and numerous non-profits. 

The organizations created a fake cereal brand, Loopholes, with period products in each box instead of toys, bringing attention to the fact that millions of people in the US have to choose between food and period products due to the lack of government support. It’s a clever and bold play, demonstrating an understanding of and anger at an institutional failure, saying “we get it and we’ve got your back.”

TikTok is another powerful avenue August uses to activate their community and de-stigmatize menstruation. It helps them take a simple biological process that’s been shrouded in shame for centuries and discuss it proudly in the social town square. 

Or, in the case of this TikTok, it helps them take a used pad and wave it proudly in Times Square. 

It’s badass, it’s impactful, and it also has 585K views. 

Challenger brands like August don't let taboos and stigma diminish their branding. Neither should you. 

2. Healthy Roots Dolls is expanding the definition of pretty with “curl power”

At the core of Healthy Roots Dolls is a heartbreaking story from founder Yelsita Jean-Charles about a Christmas in 2001: 

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“My parents handed me a very specific doll—a black Barbie. And when they did, I instantly started crying…because it wasn’t the “pretty” Barbie. How was I to know any better when the only images I saw as beautiful were the blonde-haired, blue-eyed Barbie dolls. ”

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This story of childhood struggle with identity is behind Healthy Root’s mission to make sure that no child ever feels the same way. 

Racial bias is a prominent issue in the retail and beauty industries that is just starting to be addressed. The same is true with children’s toys, though the issue doesn’t receive the same level of attention.

65% of the world’s population has curly/wavy hair, but this isn’t represented properly in society and negatively impacts the self-esteem of young girls. Healthy Roots is creating dolls and stories that help challenge and explore issues of race, identity, and adversity.

The takeaway:

Make your brand accessible by building it around deeply personal stories that resonate with everyone. 

3. Size and shape don’t matter to Misfits Market, sustainability does

Right off the bat, the Misfits Market name tells you this brand caters to the unconventional and overlooked.

The meal delivery company fights food waste by challenging superficial produce standards that supermarkets tacitly instill in us. It’s a ridiculous practice resulting in one-third of all US produce — often farmed by underpaid workers, one might add — simply goes to waste despite millions of Americans living in food-insecure homes. All this because it doesn’t look “perfect.”

Last year Misfits Market rescued over 112 million pounds of food, bringing their total up to 228 million pounds. All this while offering high-quality, organic produce at a 40% discount compared to traditional supermarkets. 

Unsurprisingly, their customers love the savings.

Prioritizing sustainability, waste reduction, and affordability not only helps Misfits Market improve the planet, but it’s also the main reason they’ve raised over $525 million in venture capital and have completed over 11 million orders to date. 

Misfits Market shows us consumers are ready to overlook socially imposed aesthetic conventions in the name of affordability and real, shared values. 

4. VFC Foods exposes the Colonel’s dirty secret

York-based VFC Foods is part of a growing movement in the vegan food industry taking a subversive approach to marketing. 

They’re bucking the stereotype of the meek vegetarian and taking the challenger brand moniker to its literal extreme by directly calling out trolls, fast food chains, and the entire meat industry. 

Some of their greatest hits include: 

Exposing a bogus KFC marketing campaign about ethical chicken farms:

Clapping back at trolls with their “Cluckwit of the Month” campaign on social media:

And turning the Cluckwit content into physical posters placed across London transit lines:

Their marketing approach plays perfectly into what The Challenger Project calls embracing drama as a strategic imperative

Publicizing a private argument and making a spectacle is an irrefutably effective tool to captivate an audience. Just look at the grotesquery around the Depp-Heard trial. 

Unlike the trial coverage, dramatic marketing can be accomplished in an ethical manner, like blurring out social handles or identifying images and going after companies instead of individuals. 

Aspiring challenger brands are wise to take a page out of VFC’s book — strategically embrace drama to bolster your marketing efforts and activate your audience. 

5. MUD\WTR is creating your new morning ritual — and then some

Coffee alternative brand MUD\WTR challenges people to kick their socially acceptable stimulant addiction with a product that has 1/7 the amount of caffeine. 

The company is built on the experience of Shane Heath, a graphic designer and former tech worker who had a toxic relationship with coffee and caffeine. 

Anxiety. Stress. Jitters. Sleeplessness. The results of a culturally-prescribed ritual gone awry. 

But MUD\WTR doesn’t stop with caffeine addiction — the brand challenges other daily rituals that negatively impact our mental state. That’s where MUD\FILMS plays into the picture. 

This growing media arm allows MUD\WTR to profile a range of topics on forming healthy routines that “improve how we rise, rest, and heal.” From psychedelic trips to cold plunges to foraging, MUD\FILMS feeds the interest of a community that’s yearning for positive human rituals. 

If there’s one thing aspiring challenger brands can take away from MUD\WTR’s success, it’s this:

People are ready to embrace new rituals that challenge firmly entrenched — even addictive — habits  

It’s not a sales gimmick — challenger brands are authentic 

The biggest takeaway for the founders, executives, and marketers of potential challenger brands is this:

 It's not a marketing gimmick.

Today’s consumers are much less tolerant of marketing BS (ahem, KFC) and are much more likely to drop a brand that doesn’t align with their values.

Noisey and unconventional marketing can help increase your brand exposure for a time. But it’s unsustainable without an authentic brand definition fueling it.

We’ll leave you with one last nugget of gold from Adam Morgan that encapsulates this:

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“A challenger strategy is only as good as the culture that supports it.”

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It’s an exciting time in the world of B2C marketing. Companies are flexing their creative muscles to connect with passionate consumers, and there’s no shortage of inspiring content to show for it. 

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