Bobbie launches in Costco stores, capping off a year of triple-digit retail growth

Bobbie chief commercial officer Sara Ahmed Holman told Modern Retail in an interview that giving customers “new ways of entering into our brand and getting access to our product is really critical to the next phase of the business.” Since it first started selling its formula in 2021 as a direct-to-consumer brand, Bobbie has been positioned as a digital disruptor. A Bloomberg profile from earlier this year described Bobbie as having “built a cultlike following among online parents.”  

But launching in more mass retailers like Walmart and Costco helps Bobbie prove it has staying power beyond just the parents who are extremely plugged in to online parenting resources. Ahmed Holman said these recent retail launches are also “really symbolic of the fact that we’re ready to serve American parents and their infant formula needs.”

Right now, Bobbie is projecting that its retail revenue will be up by more than 100% compared to 2024. It is now available in thousands of retail doors. In Whole Foods, specifically, it is the No. 1 infant formula brand. “We have outpaced every velocity in every retailer,” Ahmed Holman said. “We have proven that the consumer wants us.”

Bobbie has had ambitions of entering mass retail since its launch. But it wasn’t until Bobbie made big moves to ramp up its manufacturing capabilities — acquiring pediatric nutrition company Nature’s One in 2023 — that it could seriously consider serving large national retailers like Walmart and Costco. The acquisition enabled Bobbie to open its own infant formula manufacturing facility in 2024.

Ahmed Holman said launching at Costco became a goal after reflecting upon her own shopping behaviors as a parent. She describes herself as an “organic, convicted buyer who’s always looking for better-for-you [products].” But she, like many shoppers, has started to prioritize value more, and, she said, “I started to notice that a lot of the brands that I really loved at Whole Foods were also showing up at Costco.” She then got 15 minutes on the books with a buyer at Costco when they both attended the same conference and got more details about Costco’s process for bringing on new formula brands. 

Costco wanted Bobbie to launch on its website first — for other categories, Costco will have brands launch in a specific region first. If the products do well in that region, then Costco will roll the brand out to more regions.  But for a “category like infant formula, which is really important, you don’t want your favorite formula to be there one day and then it’s not there the next day,” Ahmed Holman said. So Costco wanted to be certain that Bobbie could perform. 

Ahmed Holman said that, within 48 hours of launching on the retailer’s website, “I got a call from Costco saying, ‘Wow, there’s a fit here.’”

“One thing that is probably the most exciting for me [is that] Costco is one of the largest retailers in the world and in this country, and it was the only retailer where the only infant formula options are owned by multi-billion-dollar pharmaceutical companies,” Ahmed Holman said, adding that it was a “real-pinch me moment” for an upstart like Bobbie to be launching in Costco. 

According to Nielsen IQ (NIQ) data, the infant formula category is dominated by two major players, Abbott Labs and Reckitt Benckiser, which together account for around 80% of sales. Compared to other product categories, infant formula is lagging in online sales presence, with e-commerce holding steady at around 10% of category volume over the past three years. Grocery and mass retailers like Walmart and Target, according to NIQ, account for around 85% of infant formula sales volume.

But, there are benefits of a multi-channel strategy. “Within online purchasing experiences, DTC options that allow subscriptions can bring an element of convenience, too, while building brand loyalty,” Kelsey Girard, senior food and drink analyst at Mintel, said in an email. And, “Platforms like Amazon are also essential for visibility and fast delivery.”

Sarah Ryan, senior director of research and insights at What to Expect, said the formula market as a whole “is changing pretty rapidly.” From the supply side, “we are seeing that feeding your infant is no longer an either/or [decision], where you are exclusively breastfeeding or exclusively formula feeding.” Combo feeding — which Bobbie has touched on in campaigns — has become more popular; What to Expect’s Research shows that about two in three moms give their babies formula at some point.

That means there’s a wide total addressable market out there as more new parents consider formula, even as “growth is capped by the finite number of babies and their consumption needs,” Girard of Mintel pointed out.

Ryan said that, when it comes to choosing formulas, What to Expect’s research shows that moms are concerned primarily about “the quality of ingredients, if it is a brand they trust, and if it is available in-store where they shop.”

“What we are seeing is that the emerging brands have to drive awareness, but they also have to educate moms on why their products would be a good choice for her,” she said. 

To that end, when Bobbie launched at Walmart — the brand’s products are available on Walmart.com and in a subset of Walmart stores — it decided to lead with education. Its end caps at Walmart include stats about the number of quality and safety checks it runs, the fact that its products contain no corn syrup, hormones and antibiotics, and that they support brain development and comfortable digestion. 

“We lead with education — unbiased, non-judgmental education — for the parent who’s shopping the formula aisle,” Ahmed Holman said. In addition to driving sales, Bobbie is also bringing a net new customer to Walmart — according to the company, 46% of Bobbie purchasers are new to the baby category at Walmart, and 19% of Bobbie purchasers are new to Walmart altogether. 

When it comes to growing the retail business next year, Ahmed Holman said Bobbie is focused on “in-stock availability and making sure that we are great partners to the retail partners who have chosen us.”

That is particularly critical in formula, a category that has been rocked by shortages and recalls over the years. Bobbie itself had to temporarily limit formula sales at the beginning of 2024 as it struggled to keep up with demand. 

Ahmed Holman said that, as chief commercial officer, her overall focus is: “How do I make Bobbie accessible as a brand?” 

“It’s not just, ‘How do I get new customers?’ It’s, ‘How do I serve the customers who want to choose Bobbie wherever they are, by going into retail?’” she said.