The ‘Better-for-You’ CPG Playbook Is Breaking—and Founders Need a New One |
The ‘Better-for-You’ CPG Playbook Is Breaking—and Founders Need a New One
The wellness halo that launched a generation of CPG brands is compressing. Tomorrow’s winners will be the most interesting brands in the room, not the most virtuous.
BY REBECCA DECZYNSKI, SENIOR EDITOR, INC.
Illustration: Getty Images
A generation of CPG brands was built on a simple bet: that consumers would pay more for products free of whatever the category’s villain ingredient happened to be that year. For a while, that bet paid off. Going forward, it won’t.
The better-for-you positioning that once justified a premium price has been claimed by so many products that it no longer signals anything meaningful. Consumers—more price-sensitive and more skeptical than they were five years ago—are increasingly unwilling to pay a premium for a benefit they can’t verify or feel.
The halo has a ceiling
Clean ingredients, functional benefits, and “no bad stuff” labeling proliferated fast. What’s left is a crowded category: countless brands with similar positioning and retail placement, all competing for a consumer who has more options and less patience than ever.
And that consumer is, quite simply, over it. After years of “clean” labels and functional claims, wellness fatigue is real. A growing cultural appetite for pleasure, indulgence, and just enjoying things has made virtue signaling on a label feel more exhausting than appealing.
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Some will point to PepsiCo’s acquisition of Poppi as evidence that better-for-you is still the winning bet. It’s worth examining. Poppi built a genuine following, but prebiotic fiber and low sugar weren’t the reasons for its breakout. It was driven by flavor, nostalgia, and a cultural moment around soda that felt fun. The health credential gave buyers permission, but it was the brand that gave people a reason to care. Those are different things. Those who mistake Poppi’s acquisition price for a validation of wellness positioning are learning the wrong lesson.
What’s actually missing
The CPG brands cutting through right now are competing on something else entirely: occasion, identity, and ritual.
Nowhere is this clearer than in the alcohol alternatives space, a category that has wellness credentials baked into its premise and yet has produced some of the sharpest examples of brands escaping the better-for-you trap. The ones building loyal followings didn’t do it by emphasizing that alcohol is harmful. They did it by making the beverage worth having on its own terms.