Brands Briefing: CPG brands are all about value packs this year as parents stock up on back-to-school items

But pushing value packs is also an important way for these startups to prove their worth to price-conscious shoppers. In Deloitte’s annual back-to-school survey, 51% of respondents said they will be shopping private labels to save money, while 75% of them said they are willing to switch to more affordable brands. When faced with shoppers who are willing to quickly drop one of their preferred brands in favor of a cheaper competitor, CPG startups see value packs as a way to convince shoppers they can offer them the most bang for their buck.

This year, the fruit bar brand That’s It released its latest product, Crunchables, which are crunchy crisps of fruit geared at toddlers and kids, with a bigger focus on large packs. The product is currently rolling out at retailers like Sprouts, Target, Kroger and H-E-B, among other grocery chains.  

The company also simultaneously released exclusive 18-count variety bags of Crunchables at warehouse clubs Sam’s Club and Costco, which began rolling out in select regions in April. This three-flavor 18-pack retails for about $13 at Sam’s Club, while the standard six-pack single-flavor box costs $5.99 at Kroger.

Elizabeth Pigg, chief communications officer at That’s It, said the move was in response to That’s It’s growing popularity among parents. “Our multi-packs are starting to do a lot better, and a lot of people are seeking more variety,” Pigg explained. That’s It also sells 24-packs of its original mini fruit bars at Costco that have become a growing part of its business since launching in 2021. That’s It also wanted the variety packs of Crunchables to be available nationwide and on Amazon in time for early back-to-school shopping.

Pigg added that the brand is trying to increase its reach by offering better-for-you fruit bars, energy bars and now Crunchables while remaining accessible. “All of our products are 24-month shelf stable, so people can stock their pantry and save,” Pigg said. She added that the company, founded in 2012, has become familiar with how families budget for food, especially during the busy school year. “We also created bigger pack sizes on Amazon, because some people like to buy them in advance and they lend themselves well to subscriptions,” Pigg said.  

This strategy will continue throughout the rest of the year as That’s It looks to increase the distribution of all of its various product lines. This fall, the brand is expanding its new line of chocolate truffles nationally. Some of the flavors, like the dark chocolate fig truffles, are already available in bulk packs at select Costco locations.

For many brands, rolling out larger pack sizes is an important way for them to endear themselves to price-conscious and time-strapped parents during back-to-school season. But first, they have to prove themselves in big-box retail. In April, Kencko, which makes freeze-dried smoothies and snacks, released a variety box of its new Fruit Snaps for Walmart, geared at families. The new SKU launched in April and offers five mini pouches for $7, compared to a standard-sized pouch that sells for $4.

Last year, Kencko overhauled its Walmart line based on customer feedback, to more clearly communicate to customers the amount of fruits, vegetables and nutrients one smoothie can provide. Kencko also released a $5 two-pack of smoothies to target more price-conscious shoppers. But, now that shoppers are more accustomed to seeing its product on Walmart shelves, Kencko is experimenting with different types of variety packs. According to the company, new flavors are being added by the end of July in time for the back-to-school season.

Bigger pack sizes are also important if startups want to have a place on the shelves of club retailers like Costco and Sam’s Club. Better-for-you chocolate brand Unreal Snacks, for example, is rolling out a Costco-exclusive variety pack that will hit all Costco stores nationwide by late September and into October, in time for Halloween season. The 15.4-ounce bag, which features some of its best-selling items, like its peanut butter cups and peanut gems, contains approximately 30 servings and costs $16.99, making it Unreal’s largest retail variety pack to date. Unreal’s standard 4.2-ounce bag of peanut butter cups retails for about $6. 

Unreal Snacks’ chief commercial officer, Alison Whritenour, told Modern Retail that the company created the new individually wrapped candy packs with Costco to cater to everyone from “the grown-up chocolate lover to a student looking for a late-night treat to a millennial mom searching for better options.” The company created the new individually-wrapped pack to give options for the bulk shopper at Costco, an important retail partner for the brand.

Pigg said brands like That’s It are consistently tweaking their messaging and product assortment to remain competitive on ever-crowded grocery shelves. “We’re seeing all these headlines about how expensive food is, so we know a lot of parents are budget-conscious right now,” she explained. –Gabriela Barkho

Job openings to watch

Some U.S.-based retail companies are pulling back operations in China, concerned about the ramifications of tariffs. But E.l.f. Beauty, which sources 75% of its products from China, is looking to staff up in the country. The California-headquartered brand recently posted openings for three China-related jobs: senior R&D scientist (under the header “China manufacturing process”), associate planning manager (under “China operations & planning”) and package development manager (under “China package development”). E.l.f. Beauty also listed some project management roles based in Shanghai. 

E.l.f. Beauty has long relied on China to keep its prices low, and it has called its supply chain there “a competitive advantage.” To mitigate the impact of tariffs, the company has said it will raise prices by $1 on its entire product assortment globally, effective Aug. 1.  Still, even as the brand ramps up in China, it’s looking to other countries for growth, too. While E.l.f. Beauty sourced nearly 100% of its products from China in 2019, it now also manufactures in Thailand and Taiwan. –Julia Waldow

Vuori’s international growth strategy

Meanwhile, activewear brand Vuori is betting on China to be a key driver of its international growth, as the company makes progress toward its goal of surpassing 100 global stores by the end of 2025. Vuori announced this week that it is set to open its first store in Seoul in September with the help of a franchise partner; it’s also set to open a store in Beijing that same month.

Vuori’s goal is to open 15 locations outside the U.S. by 2026. It already has two other international stores in London and Shanghai. In addition to its international brick-and-mortar presence, Vuori offers shipping to upward of 20 countries and has started doing some wholesale in Europe and Japan.

According to a press release, Vuori aims to approach international expansion “methodically.”  But the challenge for Vuori will be to strike a balance between not opening too many stores too quickly, while at the same time acting quickly upon lessons learned from its first batch of stores.

“We see success when we focus on density in key cities (Shanghai & London), building traction there first, and then expanding,” Vuori’s svp of international Andy Lawrence said in emailed comments. “We have also learned that certain visual elements in Asia (like video displays in stores) are critical to capturing the customer’s attention.”

Vuori also still has ambitious growth goals to hit as domestically, many in the industry are eagerly waiting for Vuori to go public. Earlier this month, Vuori named Ashley Ketcher, formerly of Fabletics, as its global president and RH’s former top lawyer Ed Lee as its Chief Legal Officer, which many in the industry viewed as key appointments ahead of a potential IPO. And Vuori has, of course, also been investing in growing its international business; Lawrence was promoted in April, and the company has a job opening for a marketing director in Greater China. –Anna Hensel

What we’re reading

• Function of Beauty has a new CEO: Monica Belsito, who has previously held marketing roles at Sabra Dipping Company, Lola and Dollar Shave Club. 
• Christine Hunsicker, ex-CEO of the fashion rental platform CaaStle, turned herself into authorities on Friday and will face fraud charges. 
  AI shopping is coming: OpenAI has shown brands a prototype of a checkout feature within ChatGPT, the Financial Times reported.

What we’ve covered

• Ritual joins a growing number of wellness brands launching at Ulta Beauty.
• How JanSport is using TikTok to drive back-to-school sales. 
• This week, Modern Retail is running a series diving into the state of malls. First up, a look at how Tanger has transcended the idea of an outlet mall.