The Times Magazine 19But looking at my own family, I don’t know
how many decisions I make or my wife
makes versus the kids.” He knew children,
particularly his teens (his daughter was then
13, his son 16), had not just pester power but
the potential to support a brand that promised
to be better for the environment.
Within days he called up an old friend,
John Schoolcraft, an ad man from Boise,
Idaho, who had been living in Europe, and
persuaded him to join as chief creative officer.
After initial scepticism from the American
- “When he said he was working for this
oat-milk company, I thought he said ‘goat
milk’. I thought, ‘What?’ ” – Schoolcraft got to
work. After a funky new logo, his first strategy
was to plaster the cartons with mini-essays,
quirky facts, even lonely-heart adverts for
people in the office.
One carton had this printed on the side:
“This tastes like sh*t. Blah!” “That’s a real
comment from a real person who tried one of
our drinks for the first time. Some people just
don’t like it.” This might be considered the
Gerald Ratner fast-track to ruin. “Lots of
people said it was a really bad idea,” says
Petersson. “The retailers in the UK hated it.”
But Schoolcraft – who wanders into the
office as Petersson is having his photo taken - explains its success: “It works because it
makes people pick it up. When we did this,
no one knew what oat milk was; no one
would pick it up.”
The real breakthrough came in 2015 when
the Swedish dairy industry, backed by the giant
farmers’ cooperative Arla, sued the company. It
argued Oatly was disparaging dairy milk with
its slogan: “Milk, but made for humans”. Oatly
lost the case and was forced to pay damages,
but sales jumped by 45 per cent. “That was
pivotal for us,” says Petersson. “In Sweden it
was a big thing. It got us a lot of attention.”
In August this year, Arla – which owns
Lurpak, Anchor and Cravendale – launched
a new brand called Jörd, a drink to “meet
consumer demand”. What’s it made of? Oats,
of course. “It is better than them producing
milk, right?” says Petersson, with a shrug.
Oatly’s contrarian approach reached its
peak during this year’s Super Bowl, the annual
showcase for America’s finest adverts (with
some football on the side). Oatly’s ad featured
Petersson sitting at a piano keyboard in a field,
singing – or rather warbling – a song he’d
written himself. The chorus ran: “Wow, wow,
no cow, no, no, no.”
He had briefly hoped to become a pop star
and recorded songs in Japan under the name
Ichiban, which translates as “number one”.
“It’s so cheesy,” he says sheepishly, but is
proud enough of his efforts to play me some
of his songs from his phone. They’re really
quite good – unlike the “Wow, no cow” song,
which was purposefully tuneless.
Schoolcraft says it cost $14 million to buy
the slot. Was it value for money? “F***, yes.
It was the best value. If you’re going to do a
Super Bowl ad, you’ve got to stick out. And
most of them are: celebrities, high budget,
a funny little joke. Ours was the complete
opposite. The budget on ours was less than
the catering budget on most adverts.”
It became the most talked-about advert
of the night.
Another key part of Oatly’s strategy
was to give out its milk at music festivals,
circumventing the mothers who do the weekly
grocery shop and putting it directly into the
hands of teens.
Hanna Meinl, Petersson’s former PA who’d
warned me about him being intense, explains
how Oatly “just took off” around 2015, thanks
to the festivals. “I remember asking one
person at the back of the queue what they
were queuing for and he said, ‘I don’t know,
but if it’s from Oatly, it must be good.’ ”
Now 27, when she joined the company
her friends thought Oatly was cool. What
do they think now? “That we’re uncool.” She
says it matter-of-factly, but hits on a key
paradox at the heart of Oatly – and indeed
many other so-called “challenger” or
“disruptor” brands. Can you stay edgy when
you go mainstream? “We are being seen as
such a big, corporate company right now
because we are an IPO company.”
This summer Oatly launched an IPO,
an initial public offering, selling about
10 per cent of its shares on the Nasdaq – the
New York stock market aimed at technology
companies. With backing from celebrity
investors such as Jay-Z, Oprah Winfrey and
Natalie Portman and a buzz about its eco-
credentials, its shares initially were worth
$13 billion before shooting up to $17 billion,
despite the company being unprofitable.
They have since fallen to $7.8 billion
(valuing Petersson’s 1.5 per cent stake at
$117 million). Has the shine come off Oatly?
Has it lost its cool? The company is no longer
stocked just in hipster cafés – Oatly now
supplies McDonald’s and KFC in China. More
than that, one of its biggest shareholders is
Chinese state-owned conglomerate China
Resources. Surely, to your typical Greta
Thunberg-loving Gen Z, cosying up to China
is incompatible with saving the world?
Petersson is apoplectic at the suggestion.“How are you going to reduce carbon
emissions? How can you – seriously!- how can you say that you want to change
something and exclude parties that really
matter? How is that even possible?” If you
want to change the world, that world must
include China.
He’s almost certainly right, but it has
upset many customers. “One of the toughest
things as a company is accepting that not
everyone will like you. For us, that’s fine,”
says Petersson.
There was one incident that left a sour note
in the mouths of some UK fans. In 2020
a Cambridgeshire family firm, Glebe Farm,
rebranded its oat milk as PureOaty. Oatly
claimed this was a trademark infringement
and took its tiny British rival to court this
summer, echoing its own David v Goliath
battle against the Swedish dairy industry.
Only this time, it was the big aggressor. Oatly
lost. In his ruling, the judge said the visual
similarity of the names was “very modest”.
Philip Rayner, the co-owner of Glebe
Farm, is furious that Oatly, which prides itself
on being ethical, resorted to heavy-handed
legal action. “It was hideously expensive
to fight the case. It cost us hundreds of
thousands of pounds, even though we
won,” he tells me.
His view of Petersson? “On the one hand,
they have greatly increased sales of oat milk
and made it appealing. But on the other hand,
you have to judge companies by their actions.
What sort of company are they, really? An
apology would be nice.”
Petersson is unrepentant, arguing PureOaty
was trying to ride on Oatly’s coat tails. “They
want to be part of that success – without
putting their resources, time and energy to
inspire and contribute to drive that shift.”
He doesn’t mind that people don’t like him
or his company for becoming big. He even
envisages a time when Oatly could become
as huge as Nestlé, the world’s biggest food
company, worth $380 billion. “What we want
to do is to create real impact that benefits the
world. If that comes with us becoming bigger
than them, sure. With the platform that
we have, we can propel this brand into the
stratosphere.” Oat milk is just the start. He has
plans to expand into various, for now, secret
areas. “It doesn’t have to be in food...”
Curiously, the one thing that bugs him is
the idea that Oatly is no longer hip. Long after
I report back to him Hanna’s comments, he
interrupts me mid-sentence to say, “I think
I just have to say: we’re cooler than ever.”
He might have to accept that it’s hard to
be cool when you become big and corporate,
when you start suing your rivals or taking
money from questionable investors. But
helping reduce climate change, in a
meaningful way? Yes, that’s pretty cool. n
OATLY HAS BEEN CRITICISED
FOR ITS TIES WITH CHINA,
AND FOR TAKING A SMALL
BRITISH RIVAL TO COURT