The plucky few: the top 10 most disruptive brands in Australia and New Zealand

Rob Grant lists 10 of the most disruptive brands in Australia and New Zealand, and what we can learn from them.

 

This article originally appeared in The Versus Issue, our February/March issue of Marketing mag.

 

Challenger brands aren’t defined by their position in the market, but by their approach to marketing. Here’s what it means to be a modern day challenger and what all brands – big and small – can learn from 10 of the most disruptive brands in Australia and New Zealand.

Conventional wisdom says the young learn from the old, the child from its parent, the naïve newcomer from the wise and worldly master. In a nutshell, Luke Skywalker and Obi-Wan Kenobi in Star Wars.

MK0217 200Yet, despite being often younger or smaller, challenger brands can flip this logic on its head. Brands that set out to change the world – or at least the part they play in it – often exhibit a passion and purpose that attracts attention, as these qualities are lost by the incumbents. Strategies used by challengers, often born from a necessity to cut through the clutter with paltry resources, are focused and innovative. They often better remember what marketing is all about: creating true value in the lives of your customers. In short, challenger brands can offer the established players lots of lessons. Not least, how to avoid being too easily challenged.

Marketing has compiled a ‘top 10’ of Australasian challengers, all with strategies marketers from all walks of life can learn from. Our hit list contenders are relatively new in their fields, but they demonstrate strong commercial and peer-recognised success. This includes huge investments, interest from bigger players and overseas expansion. They’re clearly doing something right… so what is it?

 

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10. Powershop

Utilities (electricity)

Electricity supply was a big, unwieldy industry ripe for disruption disruption and Powershop, originally from New Zealand and now active in Australia, felt it could do things differently. With a green energy-based proposition – it is owned by the region’s largest 100% renewable generator – it sought to engage the significant segment of environmentally conscious consumers.

But how could it cut through the noise with small budgets, especially in a low-involvement category? Powershop formed strong, smartly aligned partnerships with organisations such as activist group GetUp and the charity Oxfam, and let it do the marketing for it. For a cut of the action, of course.

Lesson: Form the right partnerships to tap into the customer bases of other players and reinforce your values at the same time.

 

9. GoGet

Automotive (rental)

How do you like the idea of a car on your doorstep that you can rent for $5 per hour and access at the swipe of a card?

This is what car rental membership scheme GoGet offers its members. Established by Nic Lowe and Bruce Jeffreys, a very hands-on and visible pair, the idea started in Newtown, Sydney. It’s a hugely compelling customer proposition, so good it has spread largely by word of mouth.

There is only one catch: where do the cars live? For this it was vital for GoGet to nurture close relationships with councils and local government across Australia, to persuade them to provide dedicated bays for the cars. It took this relationship focus further by connecting with small businesses, especially not-for-profit, in its target suburbs, promoting them through its friendly monthly newsletters. Now it works with property developers, at the early stages of a project, to ensure new buildings have GoGet car spaces.

Thanks to getting all sides of the model right – customer, councils, commercial and community – GoGet now operates in five Australian cities. Never underestimate friends in the right places.

Lesson: Treat wider stakeholders, upon whom your business depends, like your most valuable customers.

 

8. Sendle

B2B (logistics)

Low-cost parcel delivery service Sendle is a disruptor in the mould of Uber or Airbnb. It owns no vans and employs no drivers, yet it can deliver parcels across Australia by smartly using the spare capacity of existing delivery trucks.

Sendle started, as all good challengers should, by targeting a niche audience. In its case, small business owners. It then used a low-cost marketing model, favouring direct channels, referrals and PR, and monitored the results prudently. With tiny budgets, it was crucial every cent spend delivered a proven return.

Campaigns were A-B tested, with alternative iterations trialled side-by-side in a fight for survival – the loser is dumped or refined.It’s pretty analytical, nerdy work, but it delivers results. In 2016, Sendle took out the NSW Telstra Business Award and received a hefty round of funding from investors. All the number crunching is paying off.

Lesson: Make every dollar count by focusing your spend on low-cost, measurable channels and analyse the hell out of every transaction.

 

7. Starts at 60

Media

It’s not fashionable in marketing circles to target seniors. Which makes Starts at 60, a digital media platform aimed at Australian Baby Boomers, all the smarter. The business was founded in Brisbane in 2012 by Rebecca Wilson, the prominent face of the brand and an activist in the fight for the aged population’s rights.

From the onset, it spoke to its older readers on equal terms – unlike the patronising or clichéd tone of some titles  – and involved them heavily with different aspects of the community. It helps in the early days of a business if your content is written by your customers, because it’s free. Exponential growth rates since launch has seen the traditional media world take notice, with Seven West Media investing in the platform in 2016. With an ageing population, it seems now a no-brainer to target this audience. As is often the case with challengers, an approach seems obvious once executed. Easy to say in hindsight.

LESSON: If every other brand is targeting Tom and Dick, target Harry – your media spend
will be cheaper and you’ll be appreciated all the more.

 

6. Nourished Life

Retail (beauty)

At the heart of many challenger brands is a founder frustrated at the status quo in a given category. Irene Falcon discovered to her shock, after feeling ill and looking for an explanation, that the beauty products she used daily were laced with chemicals.

Addressing this situation became the founding purpose of her start-up, Nourished Life, which offered a resource for liked-minded souls looking for a toxin-free life. Falcon’s first action was to build a community, using a blog and several social media channels. Only later the e-commerce element was added, converting Nourished Life into a full-scale online retail player to be reckoned with.

Rapid growth followed, that must surely have attracted the attention of traditional, mainly ‘bricks and mortar’ beauty product retailers, plus a raft of business and industry awards. Despite this success, community engagement remains a core business activity, meaning Nourished Life effectively has its own media channel. Pretty handy when your budgets are dwarfed by the big guys.

LESSON: When developing a new product or service, build a passionate community – your future sales force – before launching.

 

5. UBank

Financial services (banking)

Being a challenger under the watch of a large, established parent can’t be easy. Especially in a highly regulated, staid category like finance. All credit then to UBank. In banking terms it is still a little guy, but manages to be genuinely disruptive, despite the ownership of big four stalwart NAB. It acts like a little guy, and even pokes fun at the large players, with customers not caring about the irony.

At times you must imagine the parent company’s board cringing at some of its work, but it’s effective. In 2016, it ran a controversial campaign showing terminal diseases discussing their priorities in life. These ads attracted many consumer complaints. They even had the audacity to challenge the Australian dream, suggesting the goal of owning your own house may not be the most important thing in life. Challenging stuff indeed, but it got the brand noticed and, more importantly, fit perfectly with its brand purpose: to get people to think twice about their financial decisions.

With innovation, UBank follows the start-up creed of ‘build, measure, learn, repeat’. New products are launched in beta form and tweaked until they are right. It allows them to be fast to market and responsive to customer needs, as great challenger brands must be. Life’s not perfect, so don’t try to be.

LESSON: Develop products and communications with their human emotions visible and weaknesses on show – that’s how the real world works.

 

4. Karma Cola

FMCG (beverages)

Challenger brands no longer need a big, bad enemy to fight, but it helps. By taking on the giant, global cola duopoly of the Coca-Cola Company and Pepsico, free-trade drink brand Karma Cola had a market waiting to be tapped.

As the flagship brand in New Zealand’s All Good Drinks Group, Karma Cola is enjoying success around the world. Its brand proposition is based on transparency, to create a clear contrast with other cola brands that closely guard their secret recipes. Its ingredients, all ethically sourced and organic of course, are clearly labelled on pack and in its communications.

Only simple, natural foods are used that everyone knows, such as vanilla bean, roast barley malt, coriander, nutmeg and lime. For good measure, from every bottle sold a donation is made to fund development work in Sierra Leone, where its cola beans are farmed and generously paid for.

To add warmth to its serious side, Karma Cola adopts a cheeky tone in its largely social media and event-based communications. How does it describe a new chilli cola to celebrate the Day of the Dead? Mexafrickin awesome.

LESSON: Exhibit absolute transparency across your entire business, to earn trust as a new brand or defend against any suspicion.

 

3. Vinomofo

Retail (liquor)

Behind the in-your-face attitude of Vinomofo, a rapidly growing online wine retailer, lies a simple proposition: great wine at cheap prices. From this solid base, it differentiates by removing the stuffiness from the wine world, with its light, honest and cheeky approach. Its name instantly announces it is not cut from the standard cloth. Hero wine choices include The Orgy, Duck Sauce and Old Money, which fit its attitude.

An oft-quoted mantra it uses is ‘no bowties and bollocks’. Launched in 2011 in Adelaide, Vinomofo now has over half a million customers and a raft of awards, such as Online Retailers of the Year in 2015, Last year, it received $25 million of investor funding and international expansion began recently, starting in Singapore.

Does it rile the competition? It seems, yes. Vinomofo claims major retailers pressured suppliers not to deal with it. Thankfully it grew big enough, quickly enough, to call the shots. Mofos indeed.

LESSON: Examine how incumbents act, talk and look, then do the exact opposite to stand out and attract attention.

 

2. Who Gives a Crap

FMCG (household)

Need to stand out as a new brand? Your name is a good place to start. Who Gives a Crap, a socially-conscious toilet paper brand founded in Melbourne in 2012, defies people to ignore it from the very outset.

Although Who Gives a Crap markets itself in a light-hearted way, proudly using toilet humour and awkward puns, the brand’s purpose is deadly serious. Literally. The company donates 50% of its profit to help build toilets in the developing world, in an effort to halt life-threatening diarrhoea-related diseases. For good measure, it manufactures all products from 100% recycled paper.

In only five years, the brand is a glowing success, with brand extensions beyond toilet paper and a recent launch in the US. Established multinational toilet tissue makers, already facing pressure from private label products, must be crapping themselves.

LESSON: Don’t be afraid to skirt the boundaries of decency if you want to get noticed, providing your brand purpose allows.

 

1. Canva

Software (design)

Illustrating that challenger brands barely even need a specific category to challenge, DIY design site Canva brought the ability to create professional designs to everyday people and businesses. No one else was really offering the service, but the need still existed.

Now valued at over half-a-billion dollars, thanks to major overseas investment, it would be easy for Canva to forget its founding philosophy and attitude. But culture is king at this Sydney-based start-up. Because the business started in entrepreneur Melanie Perkins’ mum’s living room, a cosy familial feeling is central to the brand’s proposition.

To ensure employees live the brand’s friendly values, initiatives like free gym memberships, on-site chefs and overseas trips help maintain a caring mindset. Apparently the company even releases doves to celebrate success.

Perhaps this is what won it the award of Australia’s Coolest Tech Company two years in a row?

LESSON: Ensure the company culture supports the brand’s attitude – if employees aren’t feeling it, neither will customers.

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BY Rob Grant ON 20 March 2017