Why challenger brands are vital to achieving government health goals

Here are two things rarely heard in the same sentence: small business and big change. But when it comes to health, challenger brands have the power to shift the dial.

Our research shows the average UK food entrepreneur starts their business with less than £15,000. With scarce resources, it’s no wonder a challenger brand is defined by its agility and ability to defy industry norms. Something that sets these brands apart is their inbuilt desire to make a difference, all whilst showing it’s possible to balance purpose with profit.

Despite the complex economic backdrop, a growing group of challenger brands are looking to displace less healthy household favourites from supermarket shelves – and it’s working. Incumbent food and drink businesses are taking notice, and government should, too.

It’s in the government’s interest to incentivise companies to pursue genuine health innovation. The pandemic shone a light on just how closely linked our health and economic stability are. But recent rollbacks on good legislation show little acknowledgement of this, or the fact that allowing companies to prioritise profit maximisation will only lead to poor health outcomes.

I know things can change, and companies that crack the code of balancing purpose and profit will encounter compelling business opportunities. After all, consumer demand for healthier alternatives is growing, but with these options now three times as expensive as their less healthy counterparts, something needs to change.

Challenger brands demonstrate it is possible to produce tasty, accessible food options that are healthier for families, not just affluent households. JimJams, a chocolate spread with 83% less sugar than competitors, is one. Urban Legend, the non-HFSS doughnut with the same calories as a glass of milk, is another. These are products displacing less healthy market leaders by offering great-tasting options without compromise.

But emerging brands require support to scale and increase impact. This is why Mission Ventures and Impact on Urban Health formed a unique partnership to establish The Good Food Programme. The scheme supports healthier challenger brands to break through and displace well-established, unhealthier products in families’ shopping baskets.

Over 30 years, the UK government has tabled 689 obesity policies, with very few turning into solutions. As the responsibility seems to have shifted back to businesses, more needs to be done to incentivise innovation and demonstrate that putting health first shouldn’t be detrimental to commercial success. The success of our programme to date shows healthier challenger brands play an important role in shifting perceptions and inspiring action across the industry.

Within 12 months of our pilot programme, seven out of 13 brands gained major national retail listings, and revenues increased more than 60%. Investor demand followed, with the brands collectively raising £6.5m. Price remained an obvious challenge, but not a showstopper. We reduced one brand’s retail price from £2.25 to 99p with significant improvements in nutrition.

Of course, the biggest indicator of success is the consumer. We demonstrated that 61% of one brand’s sales came from consumers switching from less healthy products.

So, whilst our economy is tough and global food systems precarious, if I were a government minister, instead of lifting regulation and dropping incentives designed to fuel innovation, I’d be looking to entrepreneurs for solutions. It is these innovators who can show us how things can be done.