Let's talk about Oatly
Oatly. The sustainable oat milk brand everyone’s heard of.
More times than I can count, I’ve referred to Oatly as an excellent example of brand marketing. And I still would. Though Oatly launched its product in Sweden in 1994, it took 22 years before it achieved mainstream success. And that success is almost entirely down to effective marketing combined with perfect timing (a growing demand for vegan products in Europe). They have a unique and direct brand voice, a clear mission and use advocacy campaigns to increase brand awareness, inviting consumers to join a movement.
Fast forward to 2021, and Oatly is making headlines for different reasons. They’ve had more than one ‘scandal’ in the eyes of their loyal consumers over the past year, which has resulted in boycotting for some. The most recent of said scandals is a lawsuit against a small, British supplier of oat milk called Glebe Farm. After reading an endless thread on Linkedin where Oatly replied to an original post calling them out, and tried to justify its decision to take the brand to court, I decided to dig deeper.
Global expansion requires capital
The first bump in the road for Oatly was the backlash it received for accepting funding from Blackstone in 2020. Make that $200 million in funding. So why was this problematic? Well, Blackstone has a very, very questionable reputation. For instance, Blackstone’s co-founder and CEO donated $3.7 million dollars towards Trump’s 2020 re-election campaign. In addition, Blackstone has been linked to companies accused of facilitating deforestation in the Amazon.
The main problem conscious consumers have with Oatly taking this investment is that the actions of Blackstone are not in line with Oatly’s (very vocal) stance on the climate crisis and environmentalism. One could argue they are inadvertently helping Blackstone make more money, which could result in them funding more political or business projects which are harmful for the planet. Oatly issued a statement in response to the criticism which you can read here. Essentially, the two sides of this argument for and against this type of investment are as follows:
If we want sustainability to go mainstream, we have to accept companies taking money from unethical sources - we can’t create widespread change without huge investment vs. Green capitalism doesn't solve the world’s problems. If Oatly was that concerned with taking plant-milk mainstream, it would support smaller brands and be happy with the massive profits it’s already making.
The majority of environmental activists feel strongly in the latter argument, and Oatly faced a serious PR crisis after announcing the investment. Still, the loss of a small percentage of their customers probably won’t affect them, given their expansion across the world. Eco-influencers boycotted Oatly and switched to more sustainable brands (in their eyes) and things went quiet.
Global domination means pushing out the competition
This year, Oatly has received a fresh batch of criticism and accusations of hypocrisy after it decided to take UK-based, family-owned business Glebe Farm to court over trademark infringement.
Oatly believes that Glebe Farm’s oat milk, called Pure Oaty, has packaging and a name which are too similar to theirs. Their main argument is that while they fully support the expansion of plant-based businesses, they don't believe the movement will ‘win’ (?) unless brands are unique and don’t ‘ride on the success of others’ (something which seems impossible given the nature of our economy). Here’s part of one of the responses from Oatly I saw on social media, which you can make your own judgement on:
“This case is about protecting the work we’ve been doing since the 90’s. We encourage all food companies to join the team and go plant-based, even oat-based if they like, but we also encourage them to be unique and creative, because that will help our movement a lot more. So, yes, we are all on the same team. But we will only win if all players are ready to do the work needed and find their own voice. We cannot have some players sitting on the shoulders of others all the way to the finish line. Some might unintentionally tag along for the ride, and others might do it intentionally. And when it comes to trademark protection, there’s no distinction between the two. If we want to protect the uniqueness of Oatly that we’ve worked for over a long period of time - a uniqueness that has been an essential voice in the plant-based movement – this is the path we need to take.”
The part I find most interesting about this case is the parallel you can draw from the campaign Oatly recently ran against the European Parliament's Amendment 171. This was the European dairy industry’s attempt to block plant-based milks from using packaging and wording similar to that of ‘real’ milk. Oatly’s entire campaign (to gain public support against Amendment 171) was built on the argument that the amendment implied consumers are too stupid to know the difference between cow milk and plant-based milk. Interesting, then, that Oatly has decided it doesn’t think we are smart enough to tell the difference between its brand and Pure Oaty’s.
Who knows how this court case will end. I think regardless of whether you side with Oatly or not, most people would agree that Oatly is becoming less of the socially-focused, activist brand it once was, and is well on its way to becoming a huge, multinational corporate.
Does this matter? Isn’t it a good thing that more people buy oat milk? Well, yes. But it’s more complicated than that. The age-old debate is whether or not we can tackle the global climate crisis and achieve equality under capitalism. Specifically, whether or not it’s a good thing that sustainability is going mainstream and being adopted by fundamentally unsustainable businesses. Other examples include huge fashion retailers adopting more sustainable practises and using more eco-friendly materials. Yes, that’s a good thing. But they still have a problematic business model which pumps out inordinate amounts of clothes. It’s better than nothing, but it doesn’t really solve the core issues which are causing a changing climate. And it does nothing to address human rights issues.
For me, Oatly is a perfect example of how capitalism ruins everything. It’s the classic tale of a company which starts out with genuinely good intentions, achieves massive success, goes public, becomes beholden to shareholders and then uses its power to dominate the market and push out other suppliers, becoming less sustainable and more problematic as a result. Because, growth.
I believe that to truly tackle the climate crisis we need a different economic system, one which focuses on degrowth and rewards smaller, purpose-driven businesses and taxes corporates appropriately. Whether this is possible or not given the power of those invested in maintaining the status quo, is a different question.