Disruptive, easy-to-use, uniquely designed spices are conquering the industry – and “Just Spices” has shown how successful the right strategy can be. But where there is a Coca-Cola, there is always room for a Pepsi. And that why mykraut was founded. The brand sells various spices for specific dishes, but also for a broader range of uses, packaged in test tubes and customisable to one’s own needs.

The food industry in general is changing faster than almost any other industry. With the introduction of Q-Commerce (Gorillas, Flink etc.) and other digital business models, the consumption and buying behaviour of customers in the F&B industry has changed drastically. Ordering food online is now a matter of course and going to larger food retailers has become a cop-out for many digital natives and younger generations.

Offering and selling spices online – unimaginable a few years ago, now the most normal thing in the world.

The Business Model

Leon and Jens are the founders of mykraut. After a careful analysis of the industry and the successful players in it, they wanted to incorporate the sustainability trend and created their spices without chemicals or additives and are selling the products plastic-free jars. Their products are still very innovative, have a modern design and are 100% recyclable.

Online first is their motto, so they almost only sell D2C, but to test new products, get customer feedback and expand their audience, mykraut opens various pop-up stores over the years and collaborates with retail legends like Depot. An omnichannel strategy in terms of sales, but with offline and B2B sales not as a cash cow, but as a marketing and awareness tool.

Mykraut has also figured out how to not only reach new customers, but also how to keep them and create lock-in effects. Customers can choose from over 50 different spices and blends and will see new ones almost every month. In addition, customers can create their own packages with different spices and customise them to be exactly how they like it. Therefore, it is difficult for a customer to choose a competitor.

First-hand date is the key benefit of D2C and the basis of an optimized web-shop and customer journey

Why is Direct-to-Consumer such a trend right now?

PAPA OSCAR believes that D2C is not a trend, but the future of any brand that wants to be successful. The main reason is that customer behaviour has changed dramatically in recent years. A few years ago, customers bought brands that had a certain image, and also quality and price were motivating factors. Today, it’s about more. Customers want a shopping experience during the purchase. They want to experience an advantage, and that is the reason why the old conservative retailers are struggling as they are at the moment. It’s no longer about brand or price – it’s about experience, value and the relationship between brand and customer at a particular point in time.

And D2C selling promotes exactly that, the relationship and the authenticity of brands. The customer has the feeling of belonging to a community and having some say when it comes to changes within the brand or/and the product.

And how do the D2C brands benefit from this? Through the use of data! Data and its analysis are the be-all and end-all when it comes to business decisions. By selling D2C, i.e. through its own online shop, the brand has first-hand customer data and can track and monitor every move and decision of a customer. If mykraut only sold to B2B retailers, it would be difficult to analyse the end consumer and see what the audience really wants and needs. When PAPA OSCAR Ventures joined the team in 2020, the starting point was already perfect. The industry has as much traction as ever, mykraut’s products are unique and have a USP, and the strategy was D2C sales – perfect for PAPA OSCAR to play to its strengths.

But somehow the conversion rate of Mykraut was below 1%, which is sh***. So what was the reason? After analysing the customer journey and behaviour on the website, it was obvious that the website was not optimised for a perfect experience. Mykraut prided itself on its configuration feature, but the customer could barely use the configurator on the old website. Everything was confusing and it was hard for the customer to see what was special about mykraut. The path from the homepage to the checkout should be as short and uncomplicated as possible. And that was exactly the project that had to be tackled.

Without further ado, the PAPA OSCAR team rebuilt the entire site together with Jan and Leon – based on customer data, of course. Redesigning a website is a lengthy process, especially when you have to create a customisable configurator with over 50 different options to choose from. And there are other important factors when creating a homepage. Speed is super important. New generations of customers have no patient at all when it comes to buffering or loading. So a brand basically loses customers by the millisecond their pages take to load. In summary, mykraut’s online shop had to be extremely user-friendly, transition quickly from page to page and visualise all the different features that make mykraut unique – such as the configuartor.

Needless to say, that that kind of project is not an every-day task for the developer team at PAPA OSCAR Ventures. However, after a few sprints, the website was just the way the customers and the team like it. Nevertheless, the prove of concept was missing for the new fancy-looking configuartor and shop. But after switching to the new webshop in Nov. 2021, the conversion rate successfully went trough the roof and currently is at 4.19%. Furthermore, the configurator is obviously the most clicked and used feature of the side.

What an achievement and what a great success for mykraut, PAPA OSCAR, but also for the customers – because making them happy is the goal of every great company.

Always iterate, always adapt! The key to long-term success.

Iteration is the key. Many founders or would-be entrepreneurs think they know exactly what the world and people need. Believe us, this is a mistake. Customers‘ needs and wants change faster than you can imagine, and no matter how many people you know, you will never know most of the potential customers and audience you might have.
That’s why listening, analysing, testing and iterating is the most important part of developing a business or brand. A few years ago, this was called field research. Now you can do it digitally, either through your own website or through third parties that offer different types of market research and testing opportunities.

How does PAPA OSCAR Ventures help its founders do this? First of all, PAPA OSCAR Ventures uses the synergy effects of the portfolio. They have data from more than 30 different brands and online shops, resulting in insights into more than 1 million customers from over 50 countries.
When a question comes up, you can be sure that PAPA OSCAR Ventures has answered it before. It also offers a perspective of the market, countries and different customer groups and generations.

Secondly, PAPA OSCAR Ventures consists of more than 15 employees who work full-time for the companies, analysing data, designing strategies and developing business models. So there will always be someone there to review your data, your KPIs and your performance.
Last but not least, because of PAPA OSCAR Ventures‘ market-leading position, there are various partners and tools connected to the network that offer special pricing and packages for the portfolio.

Surely, being part of the family is a win-win for everyone

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