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Illustration: Aïda Amer/Axios

Historically, generic products were associated with low prices and no frills. But fancy "generic" companies like Brandless, Italic and Hims are selling consumers a modern definition: affordable prices and better quality and experience.

When San Francisco-based Brandless debuted its online store in 2017, it aimed to provide items that are both affordable (everything is $3) and high quality. By sourcing its products directly it cuts out what it calls the “brand tax."

  • Public Goods, an online retailer based in New York, has taken a similar approach, offering select items without a retail mark-up. Unlike Brandless, its products are exclusively available to members, who pay a $59 annual fee.
  • Italic, which sells high-end goods like leather bags, touts the designer brands its affiliated manufacturers have worked with.
  • Hims focuses on prescription erectile disfunction medicine but also sells a range of men’s health products including hair loss treatments and skincare.

Because these retailers can’t rely on the reputation of other brands, gaining their customers’ trust is critical to making this model work.

  • “You can’t actually control the product quality and the product experience when you’re selling somebody else’s product,” Hims founder and CEO Andrew Dudum, whose company touts that it designs and formulates much of its products, tells Axios.

Of course, this isn’t an entirely new approach—Trader Joe’s mastered exactly the same tactics: selling fewer items, many of them manufactured by companies that sell nearly the exact same product.

The bottom line: “People want more value than just a cheaper price,” says Red Antler CEO JB Osborne, whose brand agency counts a number of these direct-to-consumer retailers among its clients, including Brandless.

Special report: The future of retail

Editor's note: The story has been updated to clarify that Hims formulates and designs much of the products it sells.

Go deeper

Former D.C. Guard alleges Army Generals lied about Jan. 6 response

Members of the National Guard and Capitol police keep a small group of pro-Trump demonstrators away from the Capitol following the insurrection on Jan. 6. Photo: Spencer Platt/Getty Images

A former D.C. National Guard official has alleged that top Army generals "lied" to Congress in their testimony on the U.S. Capitol riot, Politico first reported Monday.

The big picture: Col. Earl Matthews, who was serving on Jan. 6, alleges in a memo that the official version on the military response is "worthy of the best Stalinist or North Korea propagandist" and that the Pentagon inspector general's November report on it features "myriad inaccuracies, false or misleading statements, or examples of faulty analysis."

Toyota to build $1.3 billion U.S. battery plant in North Carolina

The all-electric Toyota bZ4X, the company's first battery-electric vehicle, at the Los Angeles Auto Show in Los Angeles, California on Nov. 17. Photo: Frederic J. Brown/AFP via Getty Images

Toyota announced Monday it's investing $1.3 billion to construct an electric vehicle battery "megasite" near Greensboro, North Carolina, set to open in 2025.

Why it matters: Toyota's Prius hybrid won environmental plaudits when it launched in 1997, but it has since lost ground to electric vehicle world leader Tesla, per Axios' Joann Muller. This battery plant will be the first to produce automotive batteries for Toyota in North America.

6 hours ago - Politics & Policy

Congress hunts for shortcut to pass defense funding, debt limit combo

Senate Majority Leader Chuck Schumer returned to his office Monday. Photo: Anna Moneymaker/Getty Images

The scramble in Congress to pass the National Defense Authorization Act is being complicated by an effort to tie it to a needed hike in the federal debt limit.

Why it matters: The House and Senate are rapidly coming up against a series of deadlines they must address before the end of the year — or risk disrupting crucial military funding and upending the economy. Congressional leaders are now hoping they can knock out both "must-pass" priorities in one, complex swoop.

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