Why VFC are giving their products away for free
VFC made the headlines when they announced they were giving their products away for free.
This campaign might seem like a fast track route to going bust but dig a little deeper and you will find a clever strategy that might not be as expensive to run as you think!
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Created by Veganuary and Veg Capital founder Matthew Glover and vegan chef Adam Lyons, Vegan Fried Chicken brand VFC made the headlines when they announced that they were giving their products away for free. Simply head to the supermarket, buy one of their products, upload a photo of your receipt and get your money refunded in full. But surely that’s just the quickest way to bankruptcy with the consumer getting all the benefit and the company getting none? But dig a little deeper and you will find a clever strategy that overcomes a significant barrier for new customers and might not be as expensive to run as you think.
If we’re being honest, as vegans, it’s now getting harder to get as excited about new vegan products. If you head to the plant-based chiller in the supermarket, you’ll now be presented with the choice of lots of different brands of vegan sausages, burgers, meatballs and bacon – and more importantly, they are all available at different price points. From premium-priced independent products, through to mid-priced plant-based ‘alternatives’ from the large established food brands, and then the budget supermarket own-labels. And although this is great for people wanting to try vegan food, it also means that getting consumers excited about a new vegan product is hard.
Following a consumer trend
A lot of the plant-based food you find in supermarkets now however is just that – it’s ‘plant-based’. It’s made by large food brands that consumers are already familiar with and presented as their plant-based ‘alternatives’. These companies are following a consumer trend: they have seen that more and more people are cutting down on eating animal products (for a whole wide range of reasons, from health to environment) and they desperately don’t want to lose those customers. Even Lord Alan Sugar, the founder of Amstrad and host of the UK’s version of The Apprentice, said that companies who don’t respond to the rise of the vegan market will end up becoming like Kodak – the photography giant that failed to embrace digital photography. Lord Sugar, who has backed a number of vegan products himself, said that from a business point of view you can’t blame companies for jumping on the bandwagon and starting to produce vegan products, because catering to new consumer trends is how you remain in business.
But that means that the motivation of these companies to produce vegan products is very different to our reasons for being vegan. It’s brilliant that we have all these choices now: the fact that in the UK, Burger King recently tried out a completely meat-free store in London for a month, and the fact that you can now buy vegan chocolate from the very same chocolate brands that you grew up eating. This is all great for normalising animal-free food. And if we want more people to try vegan food then you need to give them a way to do it without asking them to change their buying behaviour completely.
But these companies are not looking to encourage customers to transition to an animal-free diet. On the contrary, they are looking to cater to the growing number of people who have already made the decision to eat less meat and dairy whilst protecting their core animal-based business. They want to keep plant-based alternatives as just that: ‘alternatives’ that live in their own separate chiller cabinet away from their headline animal-based products.
VFC's bigger mission
This is where companies like VFC come in. VFC’s mission statement on their website reads: “Ours is an act of positive rebellion against a system that has brought us climate change, environmental destruction, factory farming and slaughterhouses. We applaud those who fight serious injustice with placards and demonstrations, with letters to MPs. We salute those who take to the streets with megaphones or lock themselves to railings. Our way to dismantle this destructive system is with great food. This is our sit-down protest.”
You might have been expecting something stronger. You might have been suspecting something along the lines of how killing chickens was bad. Well, as you go further along the VFC journey you’ll get all that. In fact, VFC teamed up with vegan influencer Joey Carbstrong to go undercover and show exactly what happens in chicken farms.
However, we know that the biggest marketplace for vegan products is non-vegans (Vegan burger company Beyond Meat revealed that as many as 93% of the customers buying their burgers were meat-eaters), and VFC understand this too. But unlike most of the supermarkets’ own-label vegan products and the large food brands bringing out plant-based alternatives, VFC actively wants consumers to ditch animal-based products and are ‘unapologetically vegan’ about it. To the point where VFC banned the use of the phrase ‘plant-based’ in their marketing.
So how does an ethically vegan company get people to make that change? How do you get reluctant consumers to try a vegan product, especially when they may have deep preconceptions about what vegan food is going to taste like? People who are not familiar with how plant-based food has evolved don’t realise how close vegan food can now come to the experience of eating animal meat if that’s what you are looking for (but without an animal having to suffer and die). In fact, it’s not unusual to see posts in vegan Facebook groups from people who serve up vegan meat replacements to their meat-eating families without telling them – and they don’t even notice the difference! So getting people simply to try your product is often one of the last barriers you have to overcome as a vegan business, as well as considering veganism in general. This is why we also have the vegan charity VIVA! running their ‘Viva! La Burger Tour‘ around the south of England where they rocked-up in a different city each day with their burger van, cooked-up Taste & Glory vegan burgers and gave them out for free to the public to show how tasty vegan food is.
Unlike the large food brands bringing out plant-based alternatives, VFC actively wants consumers to ditch animal-based products and are 'unapologetically vegan' about it.
The clever strategy behind the free-food promotion
VFC are basically doing the same as VIVA! – but on a much bigger scale. If you go down to your local supermarket, buy any of their products and then upload the receipt to the dedicated Try VFC For Free website, then they will refund the cost of that product directly back into your bank (until the end of July 2022). Doing this for three months would seem likely to be a huge cost to VFC – and being a young company, they don’t have the cash reserves of the big food companies behind them. But is it really going to be that huge a cost, or is it a very clever business strategy?
VFC really believe in their product. In fact, VegNews rated it as the number one vegan chicken brand in the US. When you have this confidence in your product then you know that once people try it they will like it – and trying it is likely the very last barrier a potential customer needs to overcome on their journey to become a paying customer. So a campaign that refunds the cost of a product in full when someone first buys it means that a customer has nothing to lose.
But it’s not just a good strategy for getting customers to try the product, it’s also a sound strategy to demonstrate to the retailer that your product is in demand. Because the campaign and refund is run independently of the shop that sells it, the store just sees an uplift in people buying the product. It’s easy to think that getting a deal with a major supermarket means that you’ve made it, but supermarkets usually put your products on sale initially for a trial period in a selected number of their stores first to see how it sells. If you want them to keep stocking your product, then you need to make sure that it sells during this probation period rather than just hoping that people will pick it up from the shelves themselves during their weekly shop. So running a promotion like this gives you a spike in sales, putting you in a far stronger place to negotiate wider distribution and to get them to take on other products in your range.
Is giving away your product financially viable as a promotion?
So that’s all well and good but it still leaves the question: is a promotion like this financially viable? Surely it’s just a straight route to going bust? Because not only are you paying all the costs of making the product but the retailers are also making their own profit on the product, and often their profit margin is bigger than yours. So when you refund the customer directly you are not just refunding your own costs of sale, you are refunding the retailer’s profit also. However, when you compare the cost of doing that to running a traditional above-the-line advertising campaign (such as taking out a TV advert or advertising on the side of a bus) it’s probably actually going to be costing you the same or possibly a lot less. At least this way, you know you’re only paying when someone is actually buying and trying your product.
There are also clever ways to offset the cost of these kinds of offers. When companies run promotions like big prize giveaways, they often insure that prize against someone winning it, meaning that the company only pays a premium to cover that insurance rather than the full prize cost. Promotional insurers can also be used to cover cashback campaigns, which means that the risk of a promotion being so wildly successful that the company can’t cover the costs can be mitigated, regardless of how many customers claim the offer.
When you put all the parts of a promotion like this together, it means that:
- You have a fixed, known cost to run the campaign, no matter how many customers claim the refund;
- You see a spike in customers to show retailers that there is a demand for your product;
- The campaign will probably cost less than running a traditional advertising campaign;
- It gives great PR headlines – what, you mean VFC are just giving-away their product?!
- And it’s also got the potential to go viral like a traditional advertising campaign can’t, giving the people who already love your product a tool to get their friends to try it too at no cost.
Don't start a business, launch a mission
The final reason why this is a great campaign is because when a customer puts their details in to claim the refund, they can also let you know what they thought about the product, giving the option to gather real customer feedback. Was trying the product enough to make them a future customer, or is there something else still holding them back? If the person also ticks the box saying that you can keep in touch with offers and news, then you know you now have the opportunity to keep nurturing them into a customer if they are not already, or to create a new advocate for your business if they are. And VFC have worked out that someone consuming 1.5kg of their product is the equivalent to saving the life of one chicken. Their mission is based on simple maths, and they know how much product they need to sell to empty those factory farms for good.
VFC haven’t started a business, they launched a mission and they know that others who believe in that mission will be attracted to them and want to promote what they do. VFC is the very definition of a vegan business – they are creating vegan activists out of all of us simply by encouraging us to buy our fried chicken through VFC instead of non-vegan fried chicken from other fast-food chains that might have a very similar name.
Let’s have a bullet point round-up of what we can take away from VFC Vegan Fried Chicken giving away their products for free:
It’s harder to get excited about new vegan products than it used to be. The plant-based chiller is full of lots of different vegan options at lots of different price points, from premium-priced independent products to budget supermarket own-label.
Having all these options is great, but the motivation behind a lot of companies producing vegan products is very different to those of an ethical vegan. Most of these products are made by non-vegan companies serving a consumer trend, whilst at the same time looking to protect their core animal-based ranges. They are not trying to convert people to a plant-based diet.
VFC, on the other hand, actively wants consumers to ditch animal-based products and are ‘unapologetically vegan’ while doing it. They know that an important part of that strategy is getting their product into people’s hands so that they can see how far vegan food has come. It can replicate that animal-meat eating experience if that’s what you are looking for, but without an animal having to suffer and die.
Offering a product for free, or rather refunding the purchase, is also a good strategy to give your product a sales spike once you get into a retailer. If you have a product with strong sales, then that puts you in a far better place to negotiate wider distribution and for the retailer to take on more of your product range.
These kinds of promotions can be more cost-effective than you think. Not only can the cost of the refunded products be less than a traditional advertising campaign, but you can also mitigate the cost by using promotional insurers meaning you pay a set fee for the promotion, no matter how many customers claim the refund.
These kinds of campaigns also have a better chance of going viral because people want to share it. Who doesn’t love free food? Have a friend who always says vegan food tastes like cardboard? Then send them a link for some free VFC to prove them wrong!
- This is also a great way to get feedback from your potential customers and to understand where they are on their journey. Was just not previously trying the product the barrier stopping them becoming a paying customer, or is there something else that you can learn about how to nudge them over the line?
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