Oatly and How the Branding Game Evolves
Oatly — the Swedish manufacturer of oat milk — is one of the hottest brands out there. Funny, however, many of its customers are not aware that Oatly is a 20-year-old company. So, how did it become famous recently? And which branding lessons can you learn from Oatly’s trajectory?
For decades, milk has been the epitome of purity, innocence, and wholesomeness around the world. That was particularly true in Sweden, where milk had been untouchable. Massive dairy brands dominated the conversation.
Oatly, a niche player whose media budget was just 2% of its giant competitors had to find a way to get its message across. Unfortunately, its overly safe- brand identity didn’t allow the company to stand out. So, they decided to combine unpredictable design with provocative thoughts.
Oatly adopted a tongue in cheek, chatty, irreverent tone that speaks to younger people interested in a more sustainable lifestyle. Their iconic messages such as, “Wow. No cow!” and “It’s like milk, but made for humans” messages cut through the clutter. The latter got the dairy industry pissed off, making them sue Oatly!
Oatly, a niche player whose media budget was just 2% of its giant competitors had to find a way to get its message across.
In an industry where the human touch is missing, Oatly’s packaging, website, and ads are a treasure trove of the personality-driven copy. Thanks to its hand-drawn typography, it looks and feels like a handmade product.
Oatly’s approach became so successful that the company grew 12 times in a few years. Around the glove, the brand became synonymous with oat milk in people’s minds. And that’s where the danger lies for Oatly.
Regardless of where you live, check your grocery store’s shelves, and you will see a local Oatly clone. And that’s where the danger starts for the Swedish brand.
Whether you are talking about oat milk or the rise and the fall of an empire or a popularity celebrity, some universal dynamics dictate how a competitive advantage erodes. In Oatly’s case, it is imitation.
Oatly’s unique brand identity is its advantage. By definition, any competitive advantage is a distinction. Successful distinctions invite imitation. Consequently, in time, exceptions become norms, losing their edge.
Whether you are talking about oat milk or the rise and the fall of an empire or a popularity celebrity, some universal dynamics dictate how a competitive advantage erodes.
Let’s, for a second, liken a company to an artichoke. It is easier for competitors to imitate its outer layers. Of course, the most outer layer of a brand is its identity: its look and feel, and tone of voice. Imitation at that level is already happening worldwide, where every new oat milk company looks like Oatly!
The second layer is knowledge and technology. Oatly promotes itself as a food science company. They introduce new product lines, such as the barista edition. That said, their formula, too, is likely to be copied — if it is not imitated already.
The final frontier is the essence of the brand: its purpose and values. Those abstract concepts are much harder to clone. Indeed, when we look at the messaging of oat milk brands from Turkey to Canada, we don’t see the fearlessness, irreverence, and revolutionary stance of Oatly.
For that reason, Oatly’s “Post Milk Generation” positioning is excellent. As long as Oatly stands for something bigger and does something positive for the planet, Oatly should be fine -provided that they continue producing a superior product.
