SEPTEMBER 3, 2015
ORANGE JUICE SEEKS A PREMIUM FUTURE
PROBIOTICS: KIDS BEVERAGES: PACKAGING TRENDS KOMBUCHA'S THE SEARCH FOR IN THE AGE OF HPP COASTAL DIVIDE MILLENIAL MOMS
DAILY BEND TO BOSTON
SAN FRAN TO NYC
NOLA TO CHI-TOWN
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Contents • Volume 13 • No. 6
ON THE COVER
4 First Drop Strands of Summer
52 Probiotics Kombucha’s Coastal Divide
40 Juice Can Premium Brands Save the Orange Juice Category?
6 Publisher’s Toast Relax, Recharge, Reinvest 30 Gerry’s Insights The System Linking Junk Science and Bad Press
DEPARTMENTS 8 BevScape Deal, Legal, Regulations, and Beer 18 New Products Zico Organic
56 Kids Beverages The Search for Millennial Moms 62 Packaging Trends Dressed for the Press – Packing in the Age of HPP
with Lemonade The Simple Beverage with the Complex Picture
TRADE SHOWS 32 Expo East Preview Naturally, Baltimore 36 NACS Preview Back to Vegas
26 Channel Check Cider Grows Tall 64 Promo Parade The Seahawks Drop in on Sparkling Ice
BevNET Magazine (ISSN 2165-6061, USPS 24-552) is published bi-monthly except monthly in March, June, September, and October by BevNET.com, Inc. 44 Pleasant Street, Suite 110, Watertown, MA 02472. Periodicals postage paid at Boston, MA and additional mailing offices. POSTMASTER: Please send address changes to BevNET Magazine, Subscriber Services, 44 Pleasant Street, Suite 110, Watertown, MA 02472
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The First Drop By Jeffrey Klineman
Some stray, slightly less serious – thoughts collected during a three-issue odyssey through diversity and the natural foods business (thanks for reading and for all of the feedback and suggestions, both public and private). So, let’s start with this standout item: Asparagus Water. Yes, it’s easy to make fun of Whole Foods for the whole $6-for-acouple-of-submerged-stalks debacle, but it’s also a pretty telling comment on how much influence a key retailer can hold over an engaged audience. I wonder how much, say, Erewhon could’ve sold it for, or Formaggio Kitchen? Yes, it’s absolutely ridiculous that the company put this on the shelf, but the idea of “free-from” really does allow for markups ad nauseum. There’s a lot of the functional food and natural food industry that makes sense, but there’s a lot of “Dr. Disingenuity’s Magic Elixir” on the shelves, too, and as Jimmy Kimmel has proven, consumers will happily drink it down and tell you it works. So the more preciously priced the “free from” food system becomes, the more it is incumbent on brands to point out real, tangible differences. Otherwise, the big food companies have the chance to devalue the efforts of real entrepreneurs by evolving less worthy brands just enough to meet shoppers at a wallet-friendly price point. How much more ridiculous is Asparagus Water than bottled water, anyway? For something stronger than water, look to the music scene: Phish is putting out a craft cocktail and craft beer program at its summer festival; the String Cheese In4 SEPTEMBER 2015 BEVNET MAGAZINE
Strands of Summer
cident actually has a brewer in its lineup, and Sierra Nevada put together a brew just for the Chris Robinson Brotherhood. And let’s not forget Sam Calagione’s granola-scented ode to the Grateful Dead. Let’s face it: love ‘em or hate ‘em, If it wasn’t for jambands and summer festivals, I’d warrant that the craft beer movement would be at least two years delayed from where it is today. Heck, Pete Slosberg himself was a huge Deadhead. Now, let’s talk cash. In the past few months, it has been great to see Dr Pepper/Snapple Group step into the investing game, but I think there’s really no comparison between putting in some short money to show faith in a brand, create alignment, and spur growth and investing for the purpose of creating a path to acquisition. There’s a big difference between DPSG laying out $20 million to Body Armor or $15 million to Bai instead of $90 million-plus for a deposit-to-buy in Coke’s Suja deal. Long-term, wouldn’t you want to have more control over the fate of the company you’re backing? Meanwhile, I can’t think of too many companies that have become acquisition targets as quickly as Suja. Except for Evolution Fresh and Blueprint. People are really, really hung up on the juicing movement. While I’m much more of a salad kind of guy, it’s still refreshing to see how many directions the category is spreading, from Tio’s cold soup lines to Daily Greens’ green-juice leadership to Forager’s push toward nut milks. I’m also interested in products like Sam Lives!, which will bring fiber back into the equation.
I still really like the tea story we did last month; is there anyone doing an exceptional, super-premium RTD tea? It’s also great that craft soda is getting some attention, along with mixers and sparkling waters. Maybe it’s time for Coke and Pepsi to work on their own mixology programs. Certainly, their brands could benefit from an on-premise makeover. Couldn’t hurt. Speed on Speed: If I were marketing cold brewed coffee, I’d want to get out ahead and establish my brand even faster now that there are so many new companies realizing that they can get into the game too. There are great products out there and so-so ones, but for so many consumers there’s not enough understanding why one cold-brew is better than another – and that could mean we’re headed for a situation similar to the first craft beer boom and bust cycle from the mid 1990s. That’s not just from a CPG point of view, either – there’s plenty of less-than-decent cold brew being served up at brick-and-mortar joints as well. On the more serious side, it is truly uplifting to see that a company like Dave’s Killer Bread, with a transparent, conscious mission to provide second chances for people who have done time in prison, could be acquired for such a high acquisition number. Here’s hoping that Flowers Foods doesn’t water down the social mission of the brand. On an unfortunate note, there’s no lack of folks who need second chances out there – if there’s been a growth industry that rivaled natural foods, it’s the prison system. Let’s make more opportunity to help lives improve.
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Publisher’s Toast By Barry Nathanson
Relax, Recharge and Reinvest
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As I sit at my desk, keyboard and screen at the ready, to write my column, my thoughts turn to day’s end and the start of a long overdue, well-deserved vacation week. Mind you, I love what I do, but it pales in comparison to having time off to play lots of tennis, enjoy the sights and sounds of Tanglewood, and bask in the beauty of the Berkshires. I’ve written many times about the importance of recreating with family and friends. Vacation means not being connected, not scanning your emails and other devices and checking in with the office. I find no virtue in not being able to disengage. It is essential to recharge your batteries. We work in a frenzied, 24-7 world, and every so often you must stop. I fully intend to and I would hope all of you would too. When I return to the hectic pace of the beverage world, I’ll be embracing a very vibrant, active industry. As we all do, on a daily basis, I receive the many posts our BevNET editors put up on the site. Often I ask friends in the industry if we’re putting out too many emails, but they all seem to keep saying to bring it on. There have been so many launches, revamps, acquisitions and investments crossing our wires, and that’s a great thing. The need
6 SEPTEMBER 2015 BEVNET MAGAZINE
to be keep informed is going warp speed, and we’re happy to serve as the conduit. There has been a flurry of activity on the investment front, a trend that I hope will continue. The big boys are taking on pieces of exciting brands with the DPS actively buying into brands. It’s nice that it isn’t always dominated by Red and Blue. That’s all well and good for the medium sized brands, with household names leading their charges to be the funding vehicle. Still, I would like to see more grass roots investing for the small brands. They can only go to “family and friends” so often to keep their businesses going forward. I’m always perplexed as to why some brands, with similar growth patterns, sales number and terrific value propositions get funding, while others don’t. Some of the dollars offered are in some cases seemingly much more than the brands actually need, while others get mere morsels. Is it a reflection on the selling ability of the principals to instill confidence in the investment community to finance them? I wish there was clarity as to how the decisions are made. For the most part, it doesn’t make sense to me. I want every brand to succeed. If the brand has a reason to be, then give them the resources to make it happen. Invest wisely, but invest.
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Bevscape The latest news on the brands you sell
REGULATION Menu Labeling Chain restaurants now have another year before they must comply with new federal regulations that require the disclosure of caloric value and supplementary health criteria of beer, food and soft drinks sold on-premise. The Food and Drug Administration (FDA) has extended the compliance date for the new rules, which apply to restaurants and foodservice establishments with 20 or more locations, from December 1st of this year to December 1st, 2016.
In its decision summary, the FDA said it has received numerous requests from retailers seeking not only more time to comply with the new standards, but also asking for clarification on portions of the rule and asking whether specific practices are amenable. The new set of rules, which among other things require written nutritional information for standard menu items to be available for consumers who ask to see it, are meant to help the customer make “informed and healthful dietary choices,” the FDA wrote in its summary. “Therefore, allowing adequate time for covered establishments to fully implement the final rule’s requirements… helps accomplish the primary objective of the final rule and is in the public interest,” the agency said. The FDA said it will provide a draft guidance document “that provides answers to some of the more frequently asked and crosscutting questions” in August.
8 SEPTEMBER 2015 BEVNET MAGAZINE
BRANDING Harmless Harvest: Raw No More Breakout coconut water brand Harmless Harvest has removed the phrase “100% Raw” from labels of its original coconut water varieties and renamed the products “Harmless Coconut Water.” The company announced the update in a July 31 blog post. Harmless Harvest has long held the position that its use of high pressure processing (HPP), which, unlike heatbased pasteurization, uses pressure to inhibit bacteria growth, allows for the use of the term, particularly with regard to the ability of the processing method to maintain the flavor and the nutritional content of the coconut water. However, citing the growth of the use of the term “raw” on a number of new products, and the U.S. Department of Agriculture’s “lack of legal definition or certification for the term,” Harmless Harvest wrote in its blog post that “there is no way for us—or any product—to achieve official certification that we are a raw product,” hence the decision to remove “100% Raw” from its labels. “With the never-ending confusion in descriptions and claims on beverage shelves, we thought the time was ripe to clarify what we make and how,” the company wrote. Harmless Harvest noted that “the last thing we want to do is create more confusion and copycats dilute such a powerful word and go the way of other meaningful words such as ‘natural.’” Following that phrase, however, came the declaration, “Yes, we are raw.” In a later interview with BevNET, co-founder Justin Guilbert noted, “Four years down the line, with the critical and commercial success, we’ve seen a lot of things evolve. There’ve been a lot of me-
too products; cold-pressed and raw [descriptors] are starting to, I believe, dilute the message around ‘what’s the superiority of the product?’ It’s around raw and not about the source. If you have a bad orange, you’re going to make bad orange juice, regardless of how you process it.” Harmless Harvest’s move may prove to be influential because of its pioneering use of HPP. Meanwhile, regulatory agencies are also exploring that processing method and its associated terminology. Over the past year, coconut water beverages labeled and sold as “raw” have attracted the watchful eye of the U.S. Food and Drug Administration (FDA), which states that the use of HPP alone is not enough to achieve a “five-log reduction,” a regulatory requirement of a 100,000 fold decrease in the number of microorganisms for juice that is packaged and sold. The FDA requires a secondary step, such as acidification or the use of ultraviolet light or radiation, is needed to control bacteria growth. In its post, the company stated that the coconut water is “essentially unchanged.” It added that the coconut water will continue to be sourced from “organic Thai Nam Hom coconuts that have been sustainably farmed and hand-picked” and “it will still be a non heat-pasteurized product.” As for the phrase “Harmless Coconut,” it appears that Harmless Harvest may have some innovation in the pipeline that goes beyond coconut water. On March 26, the company filed an application with the U.S. Patent Office to trademark the phrase, describing its use for a “Coconutbased beverage used as a milk substitute; Prepared coconut.”
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Bevscape LEGAL ABA vs. SF The American Beverage Association (ABA) has sued San Francisco over recently passed legislation by city administration that requires warning labels on ads for sugar-sweetened beverages. The lawsuit arrived six weeks after the city’s Board of Supervisors voted unanimously in favor of the legislation. The Board agreed to labeling that would read “WARNING: Drinking beverages with added sugar(s) contributes to obesity, diabetes and tooth decay.” In addition, the legislation bans advertisements for sugary beverages on city property and bans the use of city funds to purchase such beverages. Public health officials have also launched “The Open Truth” campaign, placing ads on public transportation vehicles and stations throughout San Francisco warning consumers of the potential health risks associated with soda consumption. “The city is free to try to persuade consumers to share its opinions about sugar-sweetened beverages,” the ABA’s lawsuit
reads. “Instead the city is trying to ensure that there is no free marketplace of ideas, but instead only a government-imposed, one-sided public ‘dialogue’ on the topic – in violation of the first amendment.” Last November, San Francisco voters failed to pass a measure that would institute a 2-cent-per-ounce tax on sodas and other sugary beverages. Nearby voters in Berkeley, Calif., however, passed landmark legislation to become the first city in the country to impose a tax on soda. Seventy-five percent of Alameda County voters voted in favor of the tax. Meanwhile, lawmakers in Alabama are set to meet next month to discuss a statewide tax increase on soda as the state looks to close a shortfall in its 2016 budget of $200 million. The proposed soda tax would go a long way towards doing so; officials have said it would raise $182 million. Unsurprisingly, the ABA has come out in opposition to the tax calling it “regressive and harmful” in a press release issued on July 24.
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Claim Case 1: “All Natural” Yet another beverage brand that uses “all natural” to describe its formulation has been targeted by a lawsuit seeking class action status. Pure Leaf, a line of bottled iced teas produced by PepsiCo in a joint partnership with Unilever, is the latest brand under scrutiny with plaintiffs in two separate lawsuits each of which allege that because the products use citric acid — an ingredient that can be synthetically created — as a preservative, they are being falsely marketed as “all natural.” The first lawsuit was filed in April by Florida resident Michael Laboon. Laboon claims that Unilever and PepsiCo deceptively labels Pure Leaf beverages as “natural” despite the use of “unnatural ingredients, which are synthetic, artificial, and/or genetically modified, including but not limited to Citric Acid and/or ‘Natural Flavor.’” “Unfortunately for consumers, they were charged, and paid, a price premium for these alleged ‘All Natural’ Products, over other Products that did not claim to be ‘All Natural,’” the lawsuit reads. “In addition, or as an alternative thereto, Plaintiff and members of the Class would not have purchased the Products but for the ‘All Natural’ claim, and as a result, Plaintiff and members of the Class suffered damages in the total amount of the purchase price of the Products(s) they have purchased.” Laboon filed his case in the U.S. District Court for the Southern District of Florida and is seeking class action certification.
Claim Case 2: Fire Cider Dispute A group claiming that the term “fire cider” is generic and has long been used to describe a type of cider vinegar-based elixir has launched a campaign that seeks to cancel a trademark of the phrase, which is owned by Shire City Herbals. The “Free Fire Cider” campaign is rooted in a civil lawsuit filed by Shire City against Nicole Telkes of Austin, Texas, Mary Blue of Providence, R.I. and Katheryn Langelier of Union, Maine, each of whom identify as “herbalists” whose work is focused on botanical-based wellness and health remedies. Shire City, named for its hometown of Pittsfield, Mass., filed its lawsuit in April, 10 months after the launch of an online petition on Change.org seeking to revoke the Fire Cider trademark. The petition includes a copy of the letter that organizers sent to the U.S. Patent and Trademark Office, which claims that the term and recipe for fire cider was originally introduced in the 1970s by herbalist Rosemary Gladstar who has since used it in “her copyrighted and published books, blogs and [sic] you tube videos.” “This name has become a household name for a blend of herbs historically used to prevent and support the body during times of colds and flu,” the letter reads. “Trademarking this term is like trademarking the word pizza!” In a recent article in The Boston Globe, Shire City founders Dana St. Pierre said that he and co-founders Amy Huebner and Brian Huebner feel that they are being unfairly vilified by those behind the campaign. “People think that we are some giant corporate monster, and that we are this huge dangerous threat to the entire herbalist tradition, and that we must be stopped at all cost right now or there are going to be this unraveling of everybody’s rights,” St. Pierre told The Globe.
Claim Case 3: Lee Litigation is Back A federal judge has ruled that part of a false advertising lawsuit filed against Bai Brands, maker of Bai5 Antioxidant Infusions beverages, can move forward. Filed on May 6, 2014 in the U.S. District Court, Eastern District of New York, the proposed class action lawsuit alleges that Bai has misled consumers by making claims about the antioxidant content and value of coffeefruit in its products. The lawsuit states the U.S. Food and Drug Administration prohibits nutrient content claims for antioxidants, with the exception of certain vitamins such as vitamin C. Bai has used phrases including “Antioxidant Packed” and “Antioxidant Goodness Inside” to describe its beverages. The plaintiffs claimed that consumers were deceived into paying a premium for what they thought was a healthier product. In response to an email inquiry about the lawsuit, Bai Brands CFO Ari Sorokin wrote that “as you might expect, we have been counseled not to respond to your inquiry during litigation.” Sorokin noted that “class action lawsuits are nothing new to the beverage industry, or to Lee Litigation who initiated the suit.” Based in New York, Lee Litigation describes itself as a “full service litigation law firm” with “a focus on class action lawsuits.” It currently represents plaintiffs in several recent lawsuits involving beverage brands, including Inko’s, Starbucks, and Pom Wonderful, and operates classactioninvestigation.org, a website which lists 26 “active investigations” into consumer product brands in a variety of categories. In March, Bai filed a motion to dismiss the lawsuit, which was filed on behalf of plaintiffs in California, New York and Pennsylvania. U.S. District Judge Haywood Gilliam in the Northern District of California declined to dismiss the case in its entirety, agreeing with plaintiffs that a “reasonable consumer” could be misled into thinking that phrases like “Antioxidant Packed” means that the beverages provide a “good source” of antioxidants. As a result, he deemed the prohibited nutrient content claims in the lawsuit to be valid. However, he stated that plaintiffs had not provided the court with specific instances of consumer deception, and asked their attorneys to include that information in an amended complaint. Gilliam did dismiss the plaintiffs’ claims that Bai deceived consumers by simply stating that its beverages include antioxidants. He said that the statements could “only reasonably be read to assert the undisputed fact” that the products do contain antioxidants, and that such marketing claims are allowed under FDA regulations. The case is one of a number of proposed class action lawsuits that have targeted antioxidant claims made by beverage companies. BEVNET MAGAZINE SEPTEMBER 2015
Bevscape BEER Pabst Returns to Milwaukee
Pabst Brewing Company has announced plans to build a new innovation brewery on the site of its original production facility in Milwaukee, Wisc. In a press release, the company said it plans to sign a multiyear lease on a building within the Pabst brewery “complex,” a mixed-use site that has already been partially redeveloped to include office buildings, apartments and a hotel. According to the Milwaukee-Wisconsin Journal Sentinel, the new brewery and tasting room will open in a former German Methodist church, a6,000 sq. ft. space that had previously been used as an employee bar and training center in the 1970s and 1980s. A second floor restaurant, operated by Milwaukee restaurateur Mike Eitel, is also planned, according to the paper. Slated to open next summer, the company will spend between $3 – $4 million to build “small brewery” that will serve as the company’s “innovation hub” for new product ideas and the creation of new craft beers. Once complete, the new brewery will be capable of producing about 2,000 barrels per year, according to the Milwaukee Business Journal. Pabst is partnering with (and leasing the space from) Milwaukee-based developers Zilber, Ltd., who purchased the 20-acre complex in August 2006. “The launch of this brewery in Pabst’s original home represents a long-awaited return to our roots,” chairman and CEO Eugene Kashper said in the statement. “Milwaukee is our home – the Pabst Mansion, the Pabst Theater, Pabst Farms, and this beautiful brewery complex – these are all part of Frederick Pabst’s amazing legacy, which we are honored to continue by returning to our hometown and birthplace.” In addition to brewing many of Pabst’s pre-prohibition brands like Old Tankard Ale, Andecker, and others, Pabst said it intends to brew new craft beers “inspired by recipes from the Pabst archives.” The tasting room will feature “exclusive small-batch brews” that will only be poured on site. 12 SEPTEMBER 2015 BEVNET MAGAZINE
Duvel Continues Acquisitions Another top U.S. craft brewery is changing hands. Duvel Moortgat will add to an impressive roster of American craft brands – one that already includes Kansas City’s Boulevard Brewing and New York’s Brewery Ommegang — by “combining” its U.S. operations with California’s fourth largest craft beer company, Firestone Walker Brewing. Specific financial and contractual details were not disclosed and both companies have declined to comment on the precise nature of the deal.
rel. By comparison, when Duvel acquired Boulevard 20 months ago – at the time an 187,000-barrel brewery — it paid about $100 million, according to sources familiar with the transaction. Firestone Walker produced 208,000 barrels in 2014, up 38 percent from the year prior. The company is projecting another year of growth in 2015, with
Nevertheless, sources Brewbound interviewed have characterized the transaction as an “acquisition,” and not a merger (traditional mergers typically involve two companies exchanging stock to create a single entity whereas acquisitions most often include the sale of ownership stakes in exchange for cash and/or stock in the acquiring company). Industry trade publication Beer Marketer’s Insights speculated the deal could be valued around $250 million. That amount closely mirrors a Wall Street Journal valuation estimate from last November, which pegged craft brewery multiples at $1,000 per bar-
current production forecasts in the neighborhood of 272,000 barrels, according to Duvel USA chief Simon Thorpe. Combined, the two companies are projected to make upwards of 540,000 barrels in 2015, which would catapult Duvel USA to No. 7 on the Brewers Association’s top-50 craft brewery list. The trade group currently ranks Duvel USA as the 12th largest craft brewer. In a conversation with Brewbound, Thorpe described the deal as an “investment that is all about enabling Firestone to accelerate growth.” “Together we can achieve a lot more than we can on our own,” he said.
Craft Beer at Mid-Year Craft beer volume is up 16 percent at the midway point of 2015, according to a recent Brewers Association (BA) report. Year-to-date through the end of June, U.S. craft brewers sold approximately 12.2 million barrels of beer, per the BA’s data, up from 10.6 million barrels sold during the same period in 2014. In a news release, BA chief economist Bart Watson said growth is occurring in all regions throughout the country and is “stemming from a mix of sources including various retail settings and a variety of unique brewery business models.” While craft volume is up, the segment’s typically torrid rate of growth has slowed slightly as compared to the same timeframe last year. During 2014’s mid-year check-in, that abovementioned 10.6 million barrel figure represented a volume increase of 18 percent. Watson said it’s hard to know exactly what’s behind the dip, but pointed to three things that might be contributing factors:
• A bigger base of breweries: “This 16 [percent] rate puts the segment on pace to add as many barrels as last year (if not slightly more), but that same absolute number of barrels is a lower rate on a bigger base.” • On-premise challenges: “Regionals are starting to face some of the same onpremise challenges as the large brewers – tap rotation, desire for hyper-local, etc.” • Capacity constraints: “Most of the slow growth is coming from breweries with capacity constraint issues.” The rate is still higher than the 15 percent gain in volume sales measured at the midway point of 2013. However, that count was taken using an outdated Brewers Association definition for a craft brewery, one that excluded Yuengling, which is now regarded by the trade group as the nation’s largest craft brewer. As of June 30, there were 3,739 operating craft breweries in the United States,
Bart Watson, Chief Economist, Brewers Association
699 more than at last mid-year check, according to the BA. Less than 1,750 craft breweries were operating in 2010. And there’s still plenty of entrepreneurs trying to break into the space — the organization counted 1,755 breweries-in-planning at the end of June.
BEVNET MAGAZINE SEPTEMBER 2015
Bevscape DEALS – SMALL, MEDIUM, AND MONSTROUS STAGE I Lots of money poured into beverage companies over the summer, from startup capital to huge tie-ups between multibillion dollar companies. Here are some of the highlights: On the bleeding edge of juice innovation is something called “chewable juice,” a subset inhabited by a handful of brands, including Chuice and Harvest Soul. The beverages are made up of fruit and vegetable juices that are blended with herbs, nuts and seeds that are finely chopped, as opposed to pulverized. While Chuice (an abbreviation of “chewable juice”), is carried by a just handful of retailers in its home market of Atlanta, Ga., Taste of Earth Acquisition LLC, which markets the brand, recently received a major cash infusion via former
Alibaba executive Sanjay Varma, who invested $500,000 in the company. Currently offered in two varieties, Red: The River of Life, and Green: The Forest, Chuice beverages are made with over 30 ingredients, including spinach, oranges, carrots, pumpkin seeds, brussel sprouts, pecans and honey. Positioned as healthy meal replacements, the drinks are pack-
aged in 12 oz. plastic bottles and high pressure processed. Varma had been the vice-president in charge of business development and third-most senior executive at Alibaba, the massive Chinese e-commerce company, which, following a September, 2014 initial public offering, is valued at over $212 billion. In a company statement, Varma called Chuice an “innovative and tasty new food concept” and noted that he “had never seen anything like it and saw incredible market potential.” The company, which was founded by wellness consultant and fitness trainer Ladell Hill and headed by Dr. Sujit Sharma, a physician at Children’s Healthcare of Atlanta, is seeking an additional $4
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million from other investors to support a national expansion for Chuice. Meanwhile, the Litchfield Fund, a Cleveland-based family investment fund with a focus on the natural and organic food industry, announced equity investments in Harvest Soul and in Skyr smoothie makers B’more Organic. Like Chuice, Harvest Soul is based out of Atlanta and utilizes the cold pasteurization technology high pressure processing, however Harvest Soul is USDA certified organic and in April achieved Non-GMO Project verification. It’s a distinction the Litchfield Fund’s Chief Business Officer Tom Malengo says will position Harvest Soul to thrive moving forward.
As for B’more Organic, the Baltimorebased company recently relocated to a larger office space in the city to make space for new staff hires on its sales, marketing and manufacturing teams. The brand has also recently expanded its distribution into Whole Foods’ Mid Atlantic region as well as 50 Safeway supermarkets in Virginia, Maryland and the District of Columbia. Finally, crowdfunded equity site CircleUp has raised some capital of its own to invest in the brands raising capital on its equity-based crowdfunding platform. Managed by CircleUp managing director Jason Yuan, CircleUp’s $22 million Consumer Growth Fund has invested in Canadian nutritional “Supershake” brand Rumble
“We’re making these investments for the long term and we believe being organic and non-GMO is key to prospering in the long term,” Malengo said in a call to BevNET. Malengo declined to disclose the size of the fund’s investments put pointed to the success of chia seed beverage brand Mamma Chia as an indicator of consumers’ readiness for a seemingly bleeding edge product like Harvest Soul, who received its first purchase order from United Natural Foods, Inc. (UNFI) in February ahead of the brand’s official launch in Whole Foods’ Southern Region. “Chewable juice is brand new but people are already getting used to this idea that they can chew and drink and it makes sense,” he added.
and Northern California-based hard cider producers Sonoma Cider. Both companies have also closed rounds for over $1 million and $4 million respectively using the site. The CGF’s announcement arrives as CircleUp recently passed the 100 transactions mark, with companies raising over $100 million to date on the platform. According to CircleUp COO Rory Eakin, beverage brand startups make up around 20 percent of the companies utilizing the site. Along with Rumble and Sonoma Cider, other beverage brands that have closed fundraising rounds on CircleUp include Bhakti Chai, Joia Soda, Kombucha Brooklyn and Rooibee Red Tea, who used CircleUp to secure the final $500,000 of a $2 million capital raise back in March.
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Bevscape Stage II: Bulletproof, Body Armor Defenseless Against Cash Infusions Trinity Ventures, a Menlo Park, Calif.based venture capital firm, has invested $9 million into Bulletproof, the firm best known for butter-infused Bulletproof Coffee, which it says can help consumers lose weight and get smarter. The investment comes as the company prepares to launch a three-sku FATwater line, which combines water with some of Bulletproof ’s fat-based nutritional supplements into a bottled, RTD beverage. The product soft-launched last week at seminal Los Angeles retailer Erewhon Natural Foods in three flavors, Orange, Berry, and Lemon, in 16 oz. PET bottles. Label copy indicated a 20 calorie product infused with Bulletproof EXT Oil. Its launch price is $3.95 per bottle. Trinity, which has invested heavily in technology and software ventures, is also well-known for investing early on in Starbucks. Bulletproof — a company that backs the idea of “biohacking,” or improving human functionality through changes in biochemistry — is the product of founder Dave Asprey, himself a former Entrepreneur-in-Residence with Trinity Ventures. Two Trinity executives will join Bulletproof ’s board. Bulletproof as it stands now is a platform with roots in media and homepreparation coffees and supplements, but with the investment it is branching into a brick-and-mortar cafe and store, as well as the RTD product. Meanwhile, four months after announcing a $15 million investment in Bai Brands, Dr Pepper Snapple Group is planting its flag in the premium sports drink segment. DPS has put up $20 million to acquire an 11.7 percent stake in BodyArmor, indicating a $170 million valuation for the sports drink brand Mike Repole and Lance Collins (of vitaminwater and Fuze fame, respectively) launched in 2012. According to Repole, the deal “gives us strength and muscle” moving forward as BodyArmor looks to stake its claim in a space dominated by category leaders Gatorade and Powerade. BodyArmor achieved $30 million in dollar sales in
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2014 and is projected to pass $50 million this year, he said. Currently the brand is available in 25,000 stores nationwide, a number
Repole expects to double in 2016 as Dr Pepper Snapple increases its distribution. “We’ve been pleased with BodyArmor’s growth over the past two years and believe it has strong potential as a premium sports drink,” said Rodger Collins, DPS president of packaged beverages, in a company press release. “It’s already a great part of our allied brand portfolio, it has a management team with the experience and passion to succeed, and we’re looking forward to contributing to that growth and success over the long term.”Wells Fargo Securities analyst Bonnie Herzog was bullish on the partnership in her report, pointing to the deal as the latest example in a continued trend of Big Soda investing in growth categories amidst the decline of carbonated soft drinks. “We continue to believe that DPS’s strategy to diversify away from its core carbonated soft drink brands into faster growing categories is the right long-term strategy,” Herzog wrote. “We are encouraged by DPS’s numerous partnerships and investments in rapidly growing brands within its Allied Brands stable which includes: BodyArmor, Big Red, FIJI Water, Vita Coco, Bai Brands, Neuro beverages, SunnyD, and HYDRIVE energy drinks. We expect that DPS will continue to leverage these growing brands to help support improved volume growth and offset overall weakness in the CSD category.”
Stage III: Coke Throws Down Big Money The long-rumored strategic alliance between the Coca-Cola Co. Inc. and fast-growing juice brand Suja has officially announced its sale of a minority stake to the Coca-Cola Co. and Goldman Sachs’ merchant banking wing. The deal, which will put $90 million into investors’ pockets in exchange for 30 percent of the company, will put Suja on the refrigerated trucks of Coke’s Odwalla juices, while also providing financing from the investors for a new manufacturing facility near the company’s San Diego headquarters. For Coke, the investment is expected to give the company an important partnership in a new healthy beverage category that is gaining traction with the growing cohort of consumers that are choosing to put down the soda giant’s core soda brands in exchange for less-sugar-laden products. The access to Odwalla and the fasttracked capacity construction is expected to increase the company’s distribution footprint by up to 50 percent in the next year, Suja CEO Jeff Church noted, allowing it to fulfill an imperative to make organic, high-pressure processed juices available at a reasonable price to millions of new consumers. Additionally, he said, it keeps Suja independent. “We have complete control over our business,” Church said. “That’s important to me and to the team; we’ve all seen the times when a big company swallows up a small company and the mission of the small company gets lost. The hope is that the synergies will outweigh that stuff. We’re hoping to get the best of the big company and not lose the best of the little company.” In an interview with BevNET, Church spoke passionately of the company’s sub$4 Essentials line as the way Suja, and, by extension, Coke, can create an affordable path to fulfilling demand for organic products. He noted a study by the Gallup organization that 45 percent of the U.S. population is interested in trying to add organic foods and beverages to their diets, but that the U.S. Department of Agriculture has pegged organic products as only 4 percent of U.S. food sales.
“Our goal is to democratize, to take the best quality organic juice and make it available at best possible price point,” Church said. That means using Odwalla’s reach and some of the technical knowhow brought to the company by its new partners, to cut down on the divide between cutting edge products like Suja and their high-end non-HPP competitors. “To achieve our mission, we need to have a price point below $4 in our minds,” he said. “Our main goal is to keep the gap between conventional premium juices and
help Suja grow into a larger organization. For Coke, bringing Suja on board also represents a chance to re-energize Odwalla, which has been losing share to competitors like Pepsi’s Naked Juice and Campbell’sowned Bolthouse Farms for several years. Finally, finishing up old business, Coke and Monster Beverage Corp. finalized their strategic partnership, one in which the cola giant paid $2.15 billion for a 16.7 percent stake in the energy drink company. The two companies initially reached a deal last August.
organic HPP juices at a minimum. That’s what is going to increase adoption. And we’re using our different groups of investors and employees’ knowledge base and experiences to lower our cost structure.” Much of the deal was negotiated by Matt Mitchell from Coke’s Venturing & Emerging Brands (VEB) group as well as former Minute Maid president Michael Saint John; VEB president and general manager, G. Scott Uzzell, will have one of two Coke seats on Suja’s board. But most of Suja’s relationship with Coke will go through Saint John, who will also join the board. The president of the Minute Maid division for the past 12 years, Saint John is now the President of Coke’s newly-formed Value-Added Dairy and Natural Healthy Beverages division. That group, launched in April, is tasked with overseeing Coke’s new, protein-enhanced Fairlife Milk, Odwalla, and coconut water brand Zico’s new chilled products; through Odwalla’s DSD network, the division is expected to provide the extra distribution backbone that is expected to
Along with an equity stake in Monster, Coke has become the “preferred global distribution partner” for Monster energy drinks, and assumed most of the wholesaling responsibilities for the brand globally, according to a joint release from the two companies. A notable exception is in metro New York, where Monster products will continue to be distributed by well-known independent distributor Big Geyser. Coke has also begun to plug Monster into its international business, a key part of the deal and one expected to reap massive rewards for the energy brand overseas. The two sides also swapped ownership of non-primary brands with Coke acquiring all of Monster’s non-energy drink business, including Hansen’s Natural Sodas, Peace Tea, Hubert’s Lemonade and Hansen’s Juice Products, which are now managed by Coke’s Venturing and Emerging Brands unit. In return, Monster now owns energy brands formerly held by Coke, which include NOS and Full Throttle, among others.
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New Products The newest options for cooler and shelf
Coffee Krispy Kreme has launched three new flavors to its line of ready-to-drink iced coffees. Now available in mocha, vanilla and caramel varieties, the products come in 10 oz. and 32 oz. sizes. They are sold in the refrigerated section and beverage aisles of grocery, convenience and mass merchants stores nationwide. Prices vary by market. For more information, please call Krispy Kreme at (336) 726-8996. Prospectors Cold Brew is a new line of cold-brewed coffee made with organic, fair trade beans sourced from Guatemala. The company steeps coffee for 16 hours before filtering it through a proprietary system. Mint is then added to the coffee. The brand is available in three varieties: Original, Almond Milk and Extra Strength. The drinks are available in ready-to-drink 355 mL glass bottles, and 16 oz. and 32 oz. bottles of coffee concentrate. The ready-to-drink variety retails for $3.50 and is distributed in Michigan. For more information, please call Prospectors at (616) 805-9097. Recovery drink maker Kill Cliff Inc. has launched a new line of cold brew coffees. Made with Fair Trade Certified, organic 100 percent Arabica coffee beans, the coffee is brewed for 24 hours. The product line comes in three flavor varieties: Epic Mojo, a robust, yet smooth, unsweetened black coffee; Sweet Mojo, a rich black coffee with a touch of natural sweetness; and Mojo Rising, a creamy blend of our black cold brew coffee and coconut cream. Each is sugar-free, glutenfree and dairy-free. Packaged in 11 oz. cans, the drinks have a suggested retail price of $4. The products are sold at select retailers and CrossFit affiliates across the country. For more information, please call Kill Cliff at (855) 552-5433.
Coconut Water Vita Coco has added a new flavor variety to its coconut water line. Vita Coco Lemon Tea is the brand’s take on the classic “Arnold Palm18 SEPTEMBER 2015 BEVNET MAGAZINE
er” combination of iced tea and lemonade. The product blends coconut water with black tea, sugar, lemon puree and natural lemon flavoring. It is available in a 500 mL Tetra Pak carton and exclusively sold at Kroger stores, chain-wide. The product has a suggested retail price of $2.79. For more information, please call Vita Coco at (212) 206-0763. Zico Coconut Water has a new organic variety. Zico Organic contains only one ingredient: organic coconut water from the Philippines. Packaged in a 16.9 oz. Tetra Pak carton, the beverage contains 80 calories. It is naturally free of fat, cholesterol, gluten, dairy and lactose. The product has a suggested retail price of $3.49 and is available in select regions of the U.S., including New York. For more information, please call Zico at (310) 379-9505.
Functional Beverages SDC Nutrition has launched AboutTime ProHydrate, a line of ready-to-drink, protein-infused waters. ProHydrate is currently available in two stevia-sweetened varieties: Orange Mango and Raspberry Lemonade. The beverages are made with 20g of pure whey protein isolate and are fat and lactose free. The drinks have no artificial colors, sweeteners or flavorings and each contains 95 calories per 12 oz. bottle. The products have a suggested retail price of $3.99 and are sold at health and nutrition stores nationwide. For more information, please call SDC at (412) 281-1673). Wallaby Yogurt Company, a producer of organic yogurt, has launched Wallaby Organic Whole Milk Kefir. As with all of the company’s products, the beverage is made using fresh organic milk from local pasture-based family farms and premium organic fruit. Available in Strawberry, Cherry, Peach, and Plain varieties, the products are packaged in 32 oz. bottles. They are available nationwide in natural and specialty grocers with a suggested retail price of $4.99. For more information, please call Wallaby at (707) 553-1233. “bottlePORT” is a new brand that uses dispensing cap technology to create a reusable bottle system. NYSW Beverage Brands, Inc. is the exclusive manufacturer of the product, which enables consumers to create several drinks per one bottle. The caps, which can be ordered in bulk, contain healthy ingredients in flavor-forward varieties. For more information, please call bottlePORT at (845) 254-5400 ext 103.
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New Products CSD Dry has launched a Lemongrass Reserve Edition flavor to its line of sparkling drinks in celebration of the company’s 10-year anniversary. One of Dry’s original four flavors, 5,000 cases of the beverage will be produced and sold. It will be available via select retailers in the Pacific Northwest, including QFC, Fred Meyer, Safeway, PCC and Metropolitan Market and has a suggested retail price of $9.99 per 4-pack of 12 oz. bottles. For more information, please call Dry at (206) 652-2345.
Water Fiji Water has a new 700 mL bottle size. The package retains the brand’s iconic square shape and is designed for active consumers. The water is bottled at the source in Fiji at an artesian aquifer deep within the earth. The new 700 mL bottle is available now for $2.29 in stores nationwide. For more information, please call The Wonderful Group at (310) 966-3517. Bai Brands, maker of the Bai5 and Bai5 Bubbles lines of all-natural, five-calorie, antioxidantinfused beverages, has launched Bai Antiwater. The beverage is created using a patented filtration process and aseptic bottling technology. It is infused with antioxidants and enhanced with electrolytes. The water is available in single 28.4 oz. bottles for a suggested retail price of $1.99, as well as 6- and 12-packs in select stores. For more information, please call Bai at (609) 586-0500.
Tea Ito En North America has launched Teas’ Tea Shincha, a green tea beverage brewed from the first harvest of leaves from each growing season. The first-picked Shincha tea leaves are celebrated for its fresh balance of subtle sweetness and smooth umami character. Fresh Shincha leaves are distinct from latter-harvested green teas, with a sweetness attributed to a higher content of the amino acid, L-theanine known for its calming effect and lower caffeine content. The leaves are also higher in Vitamin C and catechin antioxidants than regular green tea. Available in limited quantities each year, it is highly sought after by tea enthusiasts. packaged in a 16.9 fl. oz. recyclable BPA Free PETE bottle with a suggested retail of $1.99. It is available in Whole Foods and 20 SEPTEMBER 2015 BEVNET MAGAZINE
select specialty markets nationwide. For more information, please call Ito En at (718) 250-4000. Midori Matcha has launched a new line of cold brewed, ready-to-drink matcha beverages. The drinks are USDA certified organic and high pressure processed. Available in two varieties – Unsweetened and Honey – the products contain no added sugar and less than 20 calories per 16 oz. bottle. The beverages are distributed in Los Angeles and retail for $6. For more information, please call Midori Matcha at (855) 962-8242. Argo Tea has launched Teappuccino, a line of tea-based dairy beverages. The products are made with a blend of handpicked, loose-leaf teas, milk, fruits, flowers, spices and herbs. The line comes in three varieties: Chai, a freshbrewed Assam black tea blended with spicy ginger, cinnamon and sweet vanilla (90 calories per serving), Earl Grey Vanilla Crème, classic black tea infused with bergamot and sweet vanilla (80 calories per serving), and Green Tea Strawberry Crème, an antioxidant-rich Japanese green tea and sweet strawberries with a hint of vanilla (100 calories per serving). Packaged in 12 oz. bottles for a suggested retail price of $2.99, the beverages are available in select retailers this fall across the country. For more information, please call Argo at (312) 553-1550. Hain Celestial has launched Celestial Lattes, a new line of coffeehouse-style beverages. The product line is offered in ready-to-drink 9.5 oz. bottles and as concentrates that allow consumers to customize their lattes with their choice of milk or any non-dairy alternative. The drinks are available in four flavor varieties: Dirty Chai, The Godfather, Mountain Chai and Matcha Green. The products are available nationally. For more information, please call Hain Celestial at (516) 587-5000.
Mixers Old Orchard Brands has launched a new blend-and-serve line of frozen mixers. Available in Margarita, Pina Colada and Strawberry Daiquiri varieties, the products are made with real fruit juice. Packaged in 12 oz. plastic cans with a suggested retail price of $1.98 each Each container makes up to six, eight-ounce servings. Old Orchard Frozen Mixers are sold at Walmart and other retailers nationwide and are available in the frozen juice aisle. For more information, please call Old Orchard Brands (616) 887-1745.
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BEVNET MAGAZINE SEPTEMBER 2015
New Products Alcoholic Ginger Beer Crabbie’s has extended its line of alcoholic ginger beers with a new flavor variety. Crabbie’s Scottish Raspberry is made with Glen Ample raspberries, which are indigenous to the Perthshire and Angus regions in Scotland. They are grown and cultivated in the Strathmore Valley, known for its fertile soil and temperate climate and harvested in mid-summer. The raspberries are then macerated and extracted for use in the ginger beer. The suggested retail price is $9.99 for a 4-pack of 11.2 oz. bottles and $3.99 for 16.9 oz. bottle. The product is distributed across the U.S. For more information, please call Crabbie’s at (786) 899-5461. Wild Ginger Brewing Company has launched Wild Ginger Alcoholic Ginger Beer. The beverage is 4 percent ABV and available in 12 oz. cans. Distributed in Ohio, Indiana, Kentucky, Tennessee, Georgia, Alabama, Mississippi and North Florida, a 6-pack retails for $8.99-$9.99. For more information, please call Wild Ginger Brewing at (651) 766-5281.
Flavored Malt Beverages MillerCoors has extended its Redd’s brand with the launch of Redd’s Wicked Black Cherry. A dark-golden beer with juicy black cherry flavors and a crisp apple base, the product is 8 percent ABV. It is available in 24 oz. and 16 oz. single cans and in 12-packs of 10 oz. cans. Prices vary by market. For more information, please call MillerCoors at (312) 496-2700.
Wine Sbragia Family Vineyards has released its 2012 Monte Rosso Cabernet Sauvignon and 2012 Andolsen Cabernet Sauvignon. Both wines are blends of 95 percent Cabernet, 4 percent Cabernet Franc and 1 percent Petit Verdot. The Monte Rosso was aged for 24 months in new French oak barrels and showcases the vineyard’s iron-rich soil and its rich, concentrated fruit. It is 14.8 percent ABV retails for $65 per 750 mL bottle. The Andolsen, which spent 18 months in 100 percent new French oak barrels, features sweet red fruit and anise aromas, bright acidity and plush flavors of black fruit and sweet spice, according to the winery. It is 14.7 percent ABV and retails for $42 for a 750 mL bottle.
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For more information, please call Sbragia Family at (707) 473-2992. Panther Creek Cellars has released its first portfolio of winemaker Tony Rynders’ single vineyard designate wines. The 2013 Panther Creek Cellars Carter Vineyard Pinot Noir features blossoming violet and pomegranate swirl around a core of lightly smoked oak and black cherry. The winery produced 150 cases of the wine, which has a suggested retail price of $65 per 750 mL bottle. The winery’s 2013 French Creek Vineyard Chardonnay offers intense floral aromas of lilac and gardenia. The wine retails for $50 per bottle; 167 cases were produced. Panther Creek’s 2013 Kalita Vineyard Pinot Noir is fruit forward with a satiny texture and balanced acidity. The winery produced 167 cases of the wine, which has a suggested retail price of $50. The 2013 Schindler Vineyard Pinot Noir features light smoke with delicate coffee undertones on the palate. The winery produced 423 cases of the wine, which retails for $50. For more information, please call Panther Creek at (503) 472-8080. Lieb Cellars has expanded its line of Bridge Lane boxed wine which is now available in five varieties: Chardonnay, White Merlot, Rosé, White Blend and Red Blend. The 3L boxes hold the equivalent of 4 750 mL bottles of wine. The wines retail for $40 and are currently available for purchase in retail stores throughout NY, MA, CT, RI, NJ, and PA. For more information, please call Lieb at (631) 734-1100. Arnaldo Caprai Montefalco Rosso DOC is a blend of Sangiovese (70 percent), Sagrantino (15 percent), and Merlot (15 percent). It is characterized by a bright ruby red color with an intense aroma of ripe fruit with a hint of vanilla. The result of this blend is a juicy, full-bodied wine with a dry finish that aligns well with white meats, cooked vegetables, and strong cheeses, according to the producer. The wine has a suggested retail price of $23 and is distributed nationally. For more information, please call Colangelo PR at (646) 561-2242.
Vodka Snow Leopard is a premium vodka made from spelt grain, known for its distinct nutty fresh taste. Spelt’s tough husk protects the grain from external pollutants while retaining nutrients,
resulting in a freshness not found in others grain, according to the distillery. The vodka is distilled six times and produced in small batches. The brand was born out of a desire to save snow leopards from extinction, and a portion of sales is donated directly to their conservation. The spirit is 40 percent ABV and has a suggested retail price of $34.99 for a 750 mL bottle. It is distributed in several major U.S. cities, including New York, Washington D.C., Chicago, Los Angeles, San Diego, San Francisco, Seattle and Las Vegas. For more information, please call Lush Life Productions at (914) 584-3761.
Rum Bacardi has launched a new tangerine variety in its flavored rum line. Bacardi Tangerine is infused with tangerine flavors and comes in a newly designed package for the brand. It is available nationwide and has a suggested retail price of $12.99 for a 750 mL bottle. The rum also comes in 50 mL, 200 mL, 375 mL, 1 L and 1.75 L sizes. For more information, please call Bacardi at (305) 573-8511.
Whiskey Campari America has released Wild Turkey Master’s Keep, a limited edition, 17-year-old bourbon. Barreled at 107 proof, the whiskey was 89 proof when dumped and 86.8 proof when bottled – a result of the time the barrels spent aging in stone warehouses. The spirit features a smooth introduction on the palate, leading to a caramel and vanilla sweetness and spiciness and oak on the finish. It has a light golden hue, attributed to the whiskey’s time in the stone warehouses, where the liquid would have less interaction with the barrel’s charred wood. Master’s Keep bottle is made of the highest quality crystalline glass and is intricately embossed The whiskey is available nationally in small quantities starting and has a suggested retail price of $150. For more information, please call Campari at (646) 596-2193. The Jack Daniel Distillery has released the first-ever barrel strength offering within the Jack Daniel’s Single Barrel Collection. Jack Daniel’s Single Barrel Barrel Proof is 94 proof and is crafted using the distillery’s unique charcoalmellowing process. The whiskey is available
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New Products nationwide and has a suggested retail price of $65.00 per 750 mL bottle. For more information, please call Jack Daniel at (931) 759-7394. MGP, a supplier of premium distilled spirits, has introduced Metze’s Select, a limited edition Indiana straight bourbon whiskey. The result of marrying three distinct straight bourbon whiskeys, the spirit consists of 38 percent 2006 bourbon (21 percent rye), 3 percent 2006 bourbon (36 percent rye), and 59 percent 2008 bourbon (21 percent rye), all made by MGP. It has a high rye characteristic that merges spicy notes with creamy vanilla and caramel, according to the distiller. Only 6,000 hand-numbered bottles of the expression are available. Metze’s Select is bottled at 46.5 percent alcohol by volume and will be available in select retailers for a suggested retail price of $74.99 per 750 mL bottle. For more information, please call MGP at (913) 360-5403. Marlee’s Green Tea Whiskey is a new flavored spirit that combines whiskey and green tea. The product uses a proprietary blend of green tea sourced from select farms in China, brewed and blended with American rye whiskey and a touch of agave. It is 14.95 percent ABV and contains 140.8 mg of polyphenols per 8 oz. serving. The spirit has a suggested retail price of $17.99 and is available in select U.S. markets. For more information, please call Spirits Consulting Group at (305) 577-3806. Beam Suntory has launched Jim Beam Apple. Bottled at 70 proof, the new spirit contains apple liqueur blended with Kentucky Straight Bourbon Whiskey. The product features a fresh crisp green apple aroma and taste with subtle oak undertones, according to the company. It has a suggested retail price of $15.99 for a 750 mL bottle, and is now available in bars and retail locations nationwide. For more information, please call Beam Suntory at (847) 444-7657. Rogue Ales and Spirits has launched Rogue Chipotle Whiskey, a small-batch distilled whiskey made with chipotle peppers. Harvested by hand at the Rogue farm in Independence, Ore. the jalapeños are then dried and slowly smoked over cherry and alder woods. The smoky chipotles are then used to brew the Rogue Chipotle Whiskey wash. More freshly smoked chipotles are added during the distillation process. After distillation, the spirit is aged in Oregon oak barrels along with one final addition of 24 SEPTEMBER 2015 BEVNET MAGAZINE
chipotles. Rogue Chipotle Whiskey is available at select retailers throughout the United States and has a suggested retail price of $47 for a 750 mL swing-top bottle. For more information, please call Rogue at (503) 241-3800. Diageo’s Orphan Barrel Whiskey Distilling Company has released Rhetoric 21-Year-Old Kentucky Straight Bourbon Whiskey. An experiment in maturation, Rhetoric is rereleased annually to explore the flavor characteristics imparted by each additional year the bourbon spends in wood, allowing for side-byside comparisons. Aged in charred American oak barrels for one year longer than last year’s 20-year-old release, this bourbon represents an evolution in the progressively aged Rhetoric series. Rhetoric stocks were found at the StitzelWeller Distillery in Louisville, Ky. The bourbon was distilled in 1993 at the Bernheim Distillery historically located in Louisville, Ky. Rhetoric 21-Year-Old is hand bottled in Tullahoma, Tenn. Compared to last year’s release, Rhetoric 21-Year-Old is richer and more complex, with a fuller mouthfeel and slightly higher proof of 90.2 and features aromas of cherry, sweet tobacco, honey and leather build upon the oak, fruit, vanilla and caramel of Rhetoric 20-YearOld, according to the distillery. The whiskey is available nationwide in allocated quantities for a suggested retail price of $100 for a 750 mL bottle. For more information, please call Diageo at (646) 223-2314. Spirit Hound Distillers has released the first bottles of its Straight Malt Whisky. The spirit is distilled from an all-malt recipe made from Colorado-grown malted barley and a dash of peat-smoked malted barley, all grown and malted by Colorado Malting Company in Alamosa, Colo. It was double distilled on two handmade, built-from-scratch stills, including a Scottish pot-style still. The 90 proof whiskey is available for sale in Colorado. For more information, please call Spirit Hound at (303) 823-5696.
Other Spirits Wild Moon is a new line of botanically infused liqueurs. Handcrafted and made with all-natural ingredients, the line comes in six varieties: Birch, Cranberry, Cucumber, Lavender, Rose and Chai Spice. Each is 20 percent ABV. The liqueurs can be consumed on their own or used to accent spirits, Champagne and other bever-
Black Button Distilling, a craft distillery in Rochester, N.Y., has released Bespoke Bourbon Cream. Similar in concept to an Irish Cream, the spirit features a richer feel and bolder vanillin and caramel flavors, according to the producer. It is available in liquor stores and restaurants throughout New York, New Jersey, Pennsylvania, Georgia and Michigan and has a suggested retail price of $29.99 for a 750 mL bottle. For more information, please call Black Button at (585) 730-4512.
and takes place in the historical and valuable oak barrels that date to 1938, have long contained Marsala’s important reserves. The Marsala wine barrels create a unique flavor and spice in the liquid. The resulting liqueur features a spicy sweetness that fades into light and fruity vanilla-almond notes and finish that is peppery with a hint of dried fruit, according to the producer. The Disaronno Riserva bottle is inspired by the iconic Disaronno bottle, with a cleaner and more innovative shape that is showcased in in a refined black wooden box. Only 10,000 bottles were produced. The product is available at luxury retailers while supplies last for a price of $349 per 750 mL bottle. For more information, please call Nike Communications at (646) 354-3415.
Disaronno has introduced Disaronno Riserva, a limited edition release and the brand’s first new product since the original liqueur was created in 1525. A combination of Disaronno and blended Scotch whisky, Disaronno Riserva is aged in vintage Marsala wine barrels at the company’s own Cantine Florio in Marsala, Sicily. The process, which lasts twelve years
Big Bottom Distilling has released an Oregon Pear Brandy, the first of the two fruit brandies set for release in 2015. Made from a blend of Asian pears that were grown and hand harvested locally from the Willamette Valley, the spirit is 80 proof. It is sold in Oregon and retails for $44.95 for a 750 mL bottle. For more information, please call Big Bottom at (503) 608-7816.
ages. Produced and bottled in Hartford, Conn., the products retail for $21 per 375 mL bottle and are distributed throughout Connecticut. For more information, please call Hartford Flavor Co. at (860) 338-1642.
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Cider SOURCE: IRI, a Chicago-based market research firm (@iriworldwide) 52 Weeks through 7/12/15
What’s hot & what’s not in stores now
Lots of good news throughout the category here, as older and newer brands alike continue to grow. It’s been a hard fall for Woodchuck, though, which was purchased for a lot of money only to start heading in the wrong direction. Meanwhile, Angry Orchard has turned into Boston Beer’s biggest source of growth of the last couple of years. We’re still waiting to see a real second-generation craft breakout brand, though.
Change vs. year earlier
Smith and Forge
Stella Artois Cedre
Samuel Smith Cider
TOPLINE CATEGORY VOLUME BEER
SOURCE: IRI, a Chicago-based market research firm (@iriworldwide) 52 Weeks through 7/12/15
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Channel Check ENERGY DRINKS Brand
• Your Custom Beverage Formulator • Soda · Tea · Functional · Mixers · Vodka Rum · Whiskey · Energy · Juice · Cider Enhanced Water · Beer · Cocktail · Liqueurs
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HOT! Monster Energy Zero Ultra
Change vs. year earlier
Monster Energy Zero Ultra
Monster Energy Lo Carb
Monster Mega Energy
Monster Energy Absolute Zero
SOURCE: IRI, a Chicago-based market research NOT! Monster Energy Absoulte Zero firm (@iriworldwide) 52 Weeks through 7/12/15
• Customer Focused • • Commited to Quality •
STILL WATER Brand
Sovereign Flavors Inc 4020 W. Chandler Ave. Santa Ana, CA 92704 T: 714.437.1996 F: 714.437.1998
HOT! Glaceau Smartwater Dollar Sales
Change vs. year earlier
Nestle Pure Life
SOURCE: IRI, a Chicago-based market research firm (@iriworldwide) 52 Weeks through 7/12/15
NOT! Glaceau Vitaminwater
DOMESTIC BEER Brand
HOT! Michelob Ultra Light Dollar Sales
Michelob Ultra Light
Miller High Life
SOURCE: IRI, a Chicago-based market research firm (@iriworldwide) 52 Weeks through 7/12/15
28 SEPTEMBER 2015 BEVNET MAGAZINE
Change vs. year earlier
NOT! Keystone Light
RTD TEA Brand
HOT! Gold Peak
Change vs. year earlier
Lipton Pure Leaf
AriZona Arnold Palmer
SOURCE: IRI, a Chicago-based market research firm (@iriworldwide) 52 Weeks through 7/12/15
SPARKLING WATER Brand
NOT! Peace Tea
Change vs. year earlier
SOURCE: IRI, a Chicago-based market research firm (@iriworldwide) 52 Weeks through 7/12/15
CRAFT BEER Brand
NOT! Glaceau Fruitwater
Change vs. year earlier
SOURCE: IRI, a Chicago-based market research firm (@iriworldwide) 52 Weeks through 7/12/15
NOT! Samuel Adams
BEVNET MAGAZINE SEPTEMBER 2015
Gerry’s Insights By Gerry Khermouch
A couple of summers ago, I was coming off a bicycle ride over New York’s Triboro Bridge from the athletic fields on Randall’s Island that had me feeling virtuous about the lunch buffet I was about to gorge on. That’s when I encountered a billboard from the city’s new “Are you pouring on the pounds?” campaign. Talk about buzz kill: the outdoor ad advised me: “You have to walk the 2 ½ MILES from Randall’s Island Park to the Apollo Theater to burn off the calories from ONE 32-oz. SPORTS DRINK.” It contained a handy map showing just how far that was. Given my line of work, I should have realized that, for all the joys of walking and cycling around New York, those activities really don’t burn all that many calories. Somewhere deep inside I’m sure I was aware of that. The insight was still startling, though, in the way public service ads like that are intended to be startling. (One of the more in-your-face iterations of that campaign depicts the soda being poured from a PET bottle turning to a blob of fat in the glass.) But it was based on extensive scientific evidence that shows that, as exemplary and necessary as exercise is, it’s insufficient to maintain a healthy weight in the absence of restraint on the calorie-intake side. Better to avoid the junk calories present in sodas and sports drinks in the first place. It’s hard to judge how effective the campaign proved – there are still plenty of morbidly obese people walking the streets and riding the subways of my city, soft drinks often in hand, and in recent years increasingly desperate city officials have been resorting to more extreme measures like portion limits at movie theaters and proposals for soda taxes. But that message clearly doesn’t sit well with Coca-Cola, which has built huge businesses in categories like soda and sports drinks that the campaign was singling out. So, as The New York Times reported in an exposé a few weeks ago, the company decided to quietly marshall its own cadre of experts to tout the benefits of exercise over abstinence or restraint as the solution to the problem. It has been offering financial and logistical support to a new non-profit organization called the Global Energy Balance Network that promotes the view that Americans are too fixated on 30 SEPTEMBER 2015 BEVNET MAGAZINE
The System Linking Junk Science and Bad Press what they’re consuming when they should worry more about getting enough exercise. “Most of the focus in the popular media and in the scientific press is, ‘Oh they’re eating too much, eating too much, eating too much’ — blaming fast food, blaming sugary drinks and so on,” the group’s vice president, an exercise scientist named Steven Blair, says in a video announcing the organization, as the Times noted. “And there’s really virtually no compelling evidence that that, in fact, is the cause.” As one who spends some of my free time volunteering for an organization, Transportation Alternatives, that attempts to make it easier and more enjoyable for New Yorkers to walk and bike around the city, I do believe that obesity is, in part, an urban planning issue. In designing overly car-reliant cities, we’ve created massive disincentives to people using their own power to get to even nearby destinations. Walking, cycling, taking stairs – no question, those all can make a meaningful difference to our health and well-being. Exercise does matter. But “virtually no compelling evidence” that we’re overeating? It’s a laughable assertion, except it doesn’t seem quite so laughable coming out of the mouths of presumably objective scientists. Coke’s tactic was straight out of the playbook described in a compelling book, Merchants of Doubt, by Naomi Oreskes and Erik Conway, and subsequent documentary by Robert Kenner that related efforts over several decades by a loosely knit cadre of scientists worked to head off concerns about tobacco, acid rain, DDT and global warming. The faces are different in Coke’s effort, but the tactics are the same: to use seemingly objective scientific voices to plant just enough of a seed of doubt as to undermine a coordinated public policy response to a problem. So the Times did well to highlight the issue, in the process prompting the organization to finally identify Coke as a funding source. (It claimed not doing so had been an oversight.) The story seems to have been widely picked up, and news outlets are reminding people of other steps Coke has taken to protect its soft drink franchises, such as paying dieticians to promote soda as a healthy snack. The scrutiny is certainly deserved, but the shocked responses of some seem a bit
disingenuous to me. After all, we live in a country where the political process has been pretty well hijacked by monied interests: as I write this, most among a broad field of Republican presidential candidates seem to tailoring their platforms to the priorities of a relative handful of deep-pocketed donors rather than to their prospective constituents. Whether they represent effective policy or not, proposed soda taxes are blown out of the water by media blitzes that may equate to hundreds or even thousands of dollars for every “no” vote won in a referendum. And for all the rhetoric about an overactive administration, our timid, underfunded, politically pressured government agencies have mainly abdicated their responsibilities of watching out for the health and safety of our citizens, leaving class-action litigators to fill the void. I won’t disagree that many of those are bottom-feeders engaged in legalized extortion, so it says something about our system that they’ve come to represent a rare counterbalance to the more egregious tactics of marketers of foods, beverages and nutritional supplements. Where does this all lead? I’m actually willing to take a bit of heart from the fact that the Big 3 soda companies seem to finally be getting serious about building their portfolios of healthier products, even as they do what they think they need to do to keep the bottom from falling out of their core businesses. As I write this, Coke has just made a sizable investment in Suja Juice, and Dr Pepper Snapple finally is writing some checks to early-stage brands like Bai and Body Armor, which represent at least a modest upgrade over some of the established brands they’re challenging. Pepsi for some time has been highlighting the fact that its healthier brands already collectively amount to tens of billions in annual sales, and it’s growing its own participation in emerging categories. To the extent these companies can figure out how to prosper from their own portfolios of healthier beverages, it should reduce the need to engage in subterfuges like the ones the Times described to poison the debate. Longtime beverage-watcher Gerry Khermouch is executive editor of Beverage Business Insights, a twice-weekly e-newsletter covering the nonalcoholic beverage sector.
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Dylan Ratigan a New York Times Best-Selling author, sustainability entrepreneur and former MSNBC host
Joel Salatin a third generation farmer in Virginiaâ€™s Shenandoah Valley
Michele Simon a public health lawyer who has been writing about the food industry since 1996
ALPHABETICAL EXHIBITOR LIST
Califia Farms LP
Caribe Exotic Juice CO
Celebes Coconut Corporation
Alkame Water Inc.
Ceres Fruit Juices
Elite Naturel USA LLC
ALKAZONE/Better Health Lab Inc.
All Beauty, LLC
Cham Cold Brew Greek Tea
ALO Drink by SPI West Port, Inc.
Chameleon Cold Brew
Five Star Foodies
Back to Nature
BAO Food and Drink
Cocoa Metro Drinking Chocolate
Blossom Water LLC
Garden of Flavor
Boxed Water Is Better LLC
Counter Culture Coffee
Brands Within Reach LLC
Ginseng Up Corp
DD USA Organic, LLC
Good Groceries Company
Bruce Cost Ginger Ale
Drazil Kids Tea
GURU Beverage Inc
32 SEPTEMBER 2015 BEVNET MAGAZINE
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H20 Innovations LLC
N.O. Brew Iced Coffee
NUUN & U Natural Hydration
Harmless Harvest Inc.
Harney & Sons Tea Co
Harvest Soul, Inc.
Redwood Hill Farm & Creamery, Inc.
Rise Up Coffee Roasters
Herbal Revolution Farm & Apothecary
Rooibee Red Tea
IGNITE Sales Management
Sana Hemp Juice
Shire City Herbals
In The Raw
Sipp Sparkling Organics
INVO Coconut Water
Smart Juices LLC
ITO EN (North America), Inc.
Sound Sparkling Tea
Jade Monk, LLC
Splash Beverage Group
Jax Coco USA LLC
Kelvin Slush Co.
Thirsty Buddha Coconut Water
LaCroix Sparkling Water
Lakewood Organic Juice Company
Trickling Springs Creamery
True Me Brands LLC
Little Me Tea
Tulip International Inc.
Little Miracles Drinks, Ltd.
Unique Beverage Company LLC
Love Beets - G's Fresh Beets
Velu Wheat Grass
Vino Beverages LLC
Maple Hill Creamery
Vita Mansi Company
Vita-V Energy Co
Wai Koko Beverage Company
MetaBrand/I AM Enlightened Creations
www.naturex.com email@example.com (201) 440-5000
375 Huyler Street, South Hackensack, NJ 07606
34 SEPTEMBER 2015 BEVNET MAGAZINE
Mocktail Beverages Inc.
Mudra Mushroom LLC
Zing Anything Inc.
Zone 8 Beverages
More than 22,000
Expo Oct. 12-13
Las Vegas, NV
vendors, buyers, and other attendees
(NACS) Annual Expo
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Chris McChesney Author, The 4 Disciplines of Execution
Connie Podesta Comedian, Author, Motivator
John Mackey Co-founder, Whole Foods
ALPHABETICAL EXHIBITOR LIST
Alkame Water Inc.
Alo Drink by SPI West
Dr Pepper Snapple Group
Heineken USA, Inc.
Dr Pepper Snapple Group
Dream Products, LLC
I.am Energy Energy
Insight Beverages, Inc.
E & J Gallo Winery
ITO EN (North America), Inc.
Blue Diamond Growers
EBG dba Hard Rock Energy
Jacked Up Energy
Boxed Water Is Better
Essentia Water LLC
Javo Beverage Company, Inc.
Jel Sert Company
Jones Soda Company
Booth 4439 651
Campbell Soup Company
Florida Caribbean Distillers
Florida's Natural Growers
Frostie Root Beer
General Mills, Inc.
Kraft Foods Group, Inc.
BevNET NACS Coverage Sponsored By:
36 SEPTEMBER 2015 BEVNET MAGAZINE
Exhibitor Marley Beverage Company, LLC
The Coca-Cola Company
Tree Top, Inc.
Red Bull North America, Inc.
True Drinks, Inc.
Miami Bay Beverage Company LLC
Monarch Custom Beverages Monster Energy Company
Tum-E Yummies (BYB Brands, Inc.)
Rockstar Energy Drink
Tweaker Energy Drink
New England Tea & Coffee
Royal Cup Coffee
Unique Beverage Company, LLC/
Niagara Bottling, LLC
S & D Coffee & Tea
Nitro 2 Go, Inc.
North Shore Bottling
Shamrock Foods Company
Nth Degree Innovations
Sierra Nevada Brewing Co.
Ocean Spray Cranberries
Steuben Consumer Products
Sunny Delight Beverages Co.
Oskar Blues Brewery
Sunny Sky Products
Pabst Brewing Company
The Boston Beer Company
Cascade Ice Sparkling Water
Vasinee Food Corp
Vita Coco Coconut Water
VOCO-Vodka Coconut Water
Xing Beverage, LLC
Zymbom Energy Drink
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PrEmiuM Brands S AV E T H E O R A N G E J U I C E C AT E G O R Y by ray latif
Orange juice, once a bright spot at the center of the American breakfast tables, has lost some of its luster. In a trend that began under the carbcounting Atkins Diet days, American consumers have continued in greater numbers to turn their backs on orange juice. But now, like soda, it’s the sugar content, which for mainstream brands like Tropicana and Simply Orange measures over 20 grams per 8 oz. serving, that is most often cited as the primary reason for reduced consumption. Declining demand has pushed sales of the beverage to their lowest point in 13 years, with recent IRI data showing year-over-year volume sales down nearly 6 percent for the 52-week period ending on July 12. 40 SEPTEMBER 2015 BEVNET MAGAZINE
There is, however, a glimmer of hope for the beverage. Born out of a renaissance for home juicing and booming interest in cold-pressed blends, super premium and organic juice products have drawn acclaim and surging sales. Positioned as highly nutritious drinks, some marketers are promoting what they say are enhanced orange juices, with higher vitamin and mineral content than the legacy brands. “There’s a huge difference between mass produced, conventional orange juice and what we’re making,” said Hillary Lewis, the founder of cold-pressed brand Lumi Juice, which markets orange juice varieties. “Commercially processed juices, what they’re doing is [using] oranges that have been frozen from the year before or
even two years before and using chemicals to make sure the flavor profile is consistent. Even products that say ‘100 percent juice,’ they’ve been made with chemical flavoring that comes from an orange peel.” Disseminating comparative information about orange juice production is often a one-store-demo-at-a-time effort for Lumi, which markets a variety of organic, smallbatch and high pressure processed juices. The upside for Lumi, as well as other similarly positioned brands, is that more and more consumers are actively seeking transparency on how packaged food is made and where ingredients are sourced. A recent report from market research firm Technomic titled “Food Industry Transformation: The Next Decade” found that
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as consumers demand fresh, GMO-free, local, organic, and minimally processed foods, there will a growing premium on transparency, one that will continue to put pressure on current brands to account for their standards and practices. Gaining that type of trust from consumers is critical to sales growth. In its Global Health and Wellness Survey, Nielsen, a market data and analysis firm, reports that “76% of global respondents that say they will pay more for foods that promote health benefits.”
Lewis said that greater access to details – often shared on social media sites – about large scale production of orange juice, including a widely read story published by Bloomberg Businessweek titled “Coke Engineers Its Orange Juice - With an Algorithm,” has changed the way that many consumers perceive brands like Simply and Tropicana, particularly in the natural and specialty channels. “You see supermarkets like Whole Foods and The Fresh Market putting juicers in their aisles where people are making the juice as [customers] are shopping,” Lewis said. “And that’s really changing the way that people are consuming orange juice from products that are mass produced in the conventional sense to stuff that actually tastes real, like you’re biting into an orange.” It’s that type of experience that Lewis hopes to achieve for consumers of Lumi’s Wahoo Orange juice product. One of the brand’s top selling items, the beverage is made with one ingredient: organic Valencia oranges. At $7.99 per 16 oz. bottle, however, it’s certainly a premium offering that is limited in where it can be sold.
42 SEPTEMBER 2015 BEVNET MAGAZINE
LEMONADE The Simple Beverage with the Complex Picture By: Jeffrey Klineman We don’t like to become the story, unless it actually furthers the story. So here’s the story: last month, we ran a set of IRI numbers on Lemonade, and, well, we ticked off the folks at Calypso. Here’s what we wrote: “Looks like Calypso is finally starting to level off, but with the summer months finally here, it will be interesting to revisit this category and see if the company’s past couple of years of growth have finally slowed. Hubert’s is changing hands in the Coke/Monster Deal. In refrigerated, Simply remains the franchise to beat.” Calypso, and its president, Jeff Outlaw, didn’t like that one bit. His argument: the company’s 4.6 percent growth over the previous 52 weeks did lag the category, which was at about 9 percent, but Calypso was one of the few entrepreneurial brands on the list that was continuing to grow, and it has, in fact, been responsible for much of the sustained burst that pushed the entire lemonade category forward over the past six or seven years. “I think back to where we were with the brand, where people would look at you like ‘What are you talking about? You’re a lemonade company?’” Outlaw said. “But in the last year and a half, two years, there are a lot of folks getting into it. We look at it as the brand is so small, it’s an age-old accepted thing, this flavor – but as it’s grown, I think, I the stage is set for even more growth of the flavor profile.” Indeed, lemonade has grown in a lot of places beyond the non-alcoholic beverage space – or even the shelf-stable, single-serve zone – that comprises Calypso’s sweet spot. Lemonade flavors have shepherded the growth of the Budweiser ‘Rita franchise, as well as Mike’s Hard Lemonade; they have even moved over into beer with shandys. Candies like Skittles introduce it as a seasonal flavor. Even 5-Hour Energy had a one-SKU surge behind a pink lemonade flavored limited-time offer. That means that bigger beverage companies feel the need to roll out a lemonade to be in the category, in much the same way that Pepsi will put out a Sierra Mist or Coke deploys Powerade. If it’s a category, you have to be a player. “I go back to my early Red Bull days,” Outlaw said. “When you start to have the other people getting into the game even behind what seemed like a crazy idea, like a $1.99 eight ounce can, you know you’re getting there. Everytime we hear about a [lemonade] beer or a vodka, or even Skittles, launching, when you have major conglomerates with floors of analysts saying we need to be in lemonades, we see it as an opportunity to say to retailers, distributors,
But that’s okay, says Matt McLean, the founder and CEO of Uncle Matt’s Organic. McLean, whose company sells a range of organic juice products, believes that because of the price gap, “you can’t sell organic orange juice everywhere just yet.”
even if those bigger companies are getting in, we’re the sales per point of distribution leader.” Certainly, it’s harder to show sustained growth numbers off a larger base, and as the largest independent brand in the grouping, Calypso was performing well, especially since it doesn’t have the kind of native distribution muscle behind it as Minute Maid, Lipton, V8 or Fuze. Those big brands come in and capture sales, propelling that category upwards, but they don’t necessarily last for the long term, Outlaw said. This month’s readings – which go into mid-July, reflecting some of the summertime inflows into this seasonallydependent category – show Calypso advancing even more on its independent peers. Some of the newer big-company brands are also riding the summertime surge, like Fuze and V8 Splash, but others, like AriZona’s Golden Bear, are starting to wear out. Meanwhile, Calypso, which has the majority of its distribution in independent c-store and grocery accounts, appeared to be faring well against its up-and-downthe-street competition. BOTTLED LEMONADE
However, he added, “As the organic market continues to grow, we get further and further acceptability in conventional supermarkets,” McLean said. Promoted as “grown and produced without synthetic pesticides, GMOs or flavor packets,” Uncle Matt’s 59 oz. orange juice products, which are pasteurized, retail for $5.99, approximately $2-3 more expensive than major brands. The brand is sold nationally at Whole Foods, but also strategically distributed in grocery chains where consumers are increasing their purchases of organic products. Uncle Matt’s has a robust presence at Kroger-owned banners, where the brand is represented in over 1,000 locations. It’s also carried in 1,000 Publix stores, and is growing its presence in Safeway and Wegmans. While brands like Minute Maid and Tropicana face annual sales volume declines at or nearing double-digits, Uncle Matt’s has grown at a torrid pace alongside the organic category. Its growth is 30 percent year-over-year, since 2010. Major orange juice producers The Coca-Cola Co. (which owns Minute Maid and Simply Orange brands) and PepsiCo (Tropicana) have taken notice and are evolving, but not in terms of formulation. The beverage giants have responded to
44 SEPTEMBER 2015 BEVNET MAGAZINE
Change vs. year earlier 15.22%
Santa Cruz Organic
AriZona Golden Bear
SOURCE: IRI, a Chicago-based market research firm (@iriworldwide) 52 Weeks through 7/12/15
Coke-owned Huberts, for example, which has been transitioning over to the red system as a component of the soda giant’s deal with Monster energy, has been dropping for the past year. It’s a big comedown for a product that hit the market in 2013 and started gaining share at Cabana’s expense. By the end of 2014 it was at about $18 million, according to IRI. Now, even as the category has continued to surge, Hubert’s has dropped under $15 million. The Hubert’s team is hoping that its combination with other products in Coke’s VEB unit will help that brand find its way back to growth.
weakening demand and declining supply in the same way that they have in the face of plummeting soda sales: they raised prices. Recent Nielsen sales data for the four-week period ending on June 6 revealed that the price of a gallon of orange juice reached $6.63, a record for the beverage. While pumping up the price on soda may be a way to stabilize corporate balance sheets, Tom Pirko, managing director of beverage industry consulting firm BevMark Consulting, sees potential play for higher orange juice prices as a way to establish the drink as a premium offering, particularly amid consumers’ thirst for healthy and better-for-you beverages. Pirko, whose comments came in a recent Wall Street Journal article, noted that “the idea is to create and launch brands that tell you that orange juice is more than what we thought it was.” In a way, that has long been Uncle Matt’s strategy: building trust with its consumers by crafting a consistently high quality product, formulated as a sort of a counter argument to conventional orange juice. McLean noted that rising interest in the brand has come from millennial consumers, whose thirst for healthy products and willingness to research information on what they eat and drink is a key component of new sales. “They’re on social media, they want to know more,” McLean said of millennials. Millennials are also known for their predilection for premium products, seeking value in health and wellness over price. Promoting the benefits of orange juice, however, is something where producers have lagged in comparison to companies that market once esoteric, but now trendy “superfruit” juices, like pomegranate and coconut. Hoping to balance the scales, McLean sees opportunity to position oranges as “the original superfruit,” one that offers consumers the best value from both a health and financial standpoint. “If you look at all of the antioxidants and vitamins that come in that one piece of fruit, you’ve just got to keep talking about the natural health benefits of it,” McLean said. “It’s there; just turn it around and look at the back of the label and look at the price and compare it to all of the other juices in the case and you’ll go, ‘You know what, dollar for dollar, ounce for ounce, this is the most powerful thing for my money.’”
46 SEPTEMBER 2015 BEVNET MAGAZINE
For a category associated with simple pleasures, the actual lemonade picture is a bit murky below the surface: plenty of juice drinks and teas offer lemonade mixtures, but they aren’t always classified as lemonade. Bai has had plenty of success behind its lemonade SKU, but it is rolled in with the rest of the line. AriZona’s Arnold Palmer tea/lemonade mixture had been a wildly popular introduction, leaving the Jack Nicklaus licensed Golden Bear in the dust. The mix doesn’t always work out, though: recently, coconut water makers Vita Coco and Zola tried to roll out coconut water and lemonade combos, to limited success. Meanwhile, Sparkling Ice’s lemonade line has helped add nearly $18 million to the company’s top-line growth, but that remains a small fraction of the now-massive flavored sparkling water brand’s portfolio. Refrigerated sections of the store may also bear mixed results for the category. While Coke’s Simply and indie brand Newman’s Own have the carton business wired in the dairy case, produce-based juice brands like Odwalla, Naked and Bolthouse have all winnowed away their own, once-popular lemonade SKUs. That may create an opportunity on the high end, but for now, innovation in the category isn’t going toward premium-priced brands. “There’s no preconceived notion that lemonades need to be good for you,” Outlaw said. “We know we don’t appeal to someone who’s ultra health conscious, calorie conscious. People are just used to sugar, lemons, water.” It’s hard to replicate that flavor any other way, notes beverage expert Bill Sipper, who has worked with juice and lemonade brands at places like Nantucket Nectars, Naked Juice and New Leaf. With all of the tartness of the lemon, plenty of sugar has to go in as well for balance, he notes, although, he said, stevia works well with lemons and may yet have an impact. Even more of an issue, however, may be the expense of lemonade ingredients – the old adage about squeezing a lot of lemons is true. Split between shelf-stable and the cold box, big cartons and single-serves, lemonade as a category might not be easy to nail down. But it does run deep. Which brings us back to Calypso, where the company asserts that the biggest growth obstacle last year was actually lack of capacity. At a brand that runs 20 flavors deep, including 13 flavored lemonades, along with limeades and “teamonades,” that’s something that demand will change, and it has, as the company has scaled up, building a centralized sales team from what had been a patchwork of brokers and bottlers. It’s landed some Kroger banners to go with an existing Wal-Mart footprint and has raised its marketing game, aiming to add more chains to the ones it’s already got and its strong DSD footprint. “This is a small category still,” Outlaw said. “We don’t know if we’re writing a chapter of beverage history. But it’s a fun ride.”
Genius Juice is now available at all 52 Whole
Foods Market stores in the grocer’s Southern Pacific region. Additionally, the brand has just been approved at 18 Gelson’s Market locations.In August the brand unveilved new packaging, replacing its 8 oz. and 16 oz. bottles with a singular 12 oz. offering. Mamma Chia has introduced ‘Chia & Greens’, a new line of juice blends consisting of four flavors including Love Greens (Beet & Ginger), Soulful Greens (Cayenne & Lemon), Joyful Greens (Ginger & Lemongrass) and Grateful Greens (Kale & Mint). ‘Chia & Greens’ will be available nationally at Whole Foods in October, as well as select Safeway and Albertsons stores.
Magazine for best nutrition beverage. In June, the company launched a coffee SKU in its coconut water with protein line. The brand was available as the back-stage hydrator of a number of award shows this season including the BET Awards, Billboard Music Awards and the Kids Choice Sports Awards. Suja Juice is introducing three new addi-
tions to its Suja Classic Line: Lavenade, Revive, and Fortitude, all of which have less than 10 grams of sugar per serving. These new juices will be available at select Whole Foods Markets and Targets nationwide. All of Suja’s products are organic, non-GMO, and cold-pressured. Pressed Juicery now has over 30 stores
JUICE | Served Here has released an exclu-
sive line of organic, gluten-free, non-GMO vegan, cold-pressed lemonades. There are seven flavors: Ginger, Strawberry, Carrot Ginger, Jalapeno, Turmeric Orange, Berry Berry and Charcoal, the latter of which contains activated charcoal and terramin clay for maximum detoxification benefits. The coldpressed company is rolling out nationwide next-day shipping this October. Bundle Organics, a line of organic juices designed specifically to address the nutritional needs of expecting a new moms, has expanded its distribution into select Babies “R” Us and Buy Buy Baby stores nationwide. Each juice is made with USDA-certified organic, non-GMO fruits and veggies and fortified with OBGYN-recommended nutrients that complement daily prenatal vitamins. The Splendid Spoon is launching all new microwave-friendly bottles in Fall 2015. The brand has also announced it first fall flavor in the new format, which will be pumpkin with pear and hempseed. Langer Juice Company has new packaging for its 64 oz. USA Grown Apple Juice to highlight its apples’ 100 percent USA grown roots. Additionally, the brand’s 64 oz. Organic Apple, Grape and Cranberry juices are now available nationwide. Coco Libre organic coconut water won a
2015 Eco-Excellence Award from NCW 48 SEPTEMBER 2015 BEVNET MAGAZINE
throughout California and Nevada, with upcoming locations in Los Angeles, Las Vegas, San Diego and New York City slated to open this Fall. The company also recently released a line of 2 oz. shots in select locations. Lori’s Original Lemonade. Expanding their
line of organic artisanal lemonades, Lori’s Original Lemonade released a Lite Lemongrass Lemonade this past May. Using a blend of organic cane sugar and organic stevia, the Lite Lemongrass Lemonade contains only nine grams of sugar per serving. The brand recently expanded into 18 Gelson’s Markets as well as several Haggens throughout the central coast and Southern California. Mucho Gazpacho is launching a Green Gazpacho flavor in September, with ingredients including spinach and romaine lettuce. The brand is available in South Florida and online at Amazon.com. Rawpothecary has expanded its distribution and is now bi-coastal. The brand is sold throughout the New York tri-state area and is also now available at Costcos throughout southern California. HiFit Juice is a natural hibiscus extract bever-
age that comes in three exotic flavors: Pineapple & Mint, Orange & Mango and Pomegranate & Raspberry. The company is working with independent Pepsi distributors to deliver HiFit Juice in larger grocery stores such as
Hy-Vee, convenient stores and universities throughout Illinois, Iowa and Wisconsin.
Ginger and Blood Orange Chili flavors. Big Island Organics has expanded into the
Honeydrop Beverages has added four new
‘Honeyade’ flavors to its expanding portfolio of cold-pressed juices: Matcha Lemon, Strawberry Lemon, Turmeric Lemon and Kale Cucumber. The new flavors recently launched in Whole Foods, Fresh Market, and Central Market. Each 10 oz. bottle contains a tablespoon of raw local honey or Manuka honey. Tio Gazpacho has re-launched its e-commerce platform, allowing customers to order customizable 3-, 6-, and 12-packs of Tio Gazpacho’s three varieties. Wild Poppy recently added Target to its
list of national and regional retailers, joining Whole Foods, Fresh & Easy and The Fresh Market. The organic craft fruit drink combines fruit with spice and agave in a 10 oz. clear glass bottle and is available in Peach Vanilla, Peppermint Lemonade, Grapefruit
Pacific Northwest with distribution through Unified Grocers, Nature’s Best powered by KeHe and UNFI. The brand’s four flavors Hawaiian Gingerade, Gingerade Mate, Agave Lemonade and Noni Lemonade are available in 16 oz. and 32 oz. glass bottles. Lumi Juice has begun a regional distribution partnership with Sysco. The distributor will carry five varieties of Lumi’s 10 oz. coldpressed, organic and high pressure processed juices: Wahoo Orange, Morning Sunrise, Farmhouse Greens, UpBeet Pear and Big Green. V8 has launched a Watermelon Cherry variety, which is available at most Walmart stores. The Clean Drinking Juice Company
launched a line of non-alcoholic, coldpressed juice cocktail mixers and hangover elixirs this Summer
BEVNET MAGAZINE SEPTEMBER 2015
Brand News LemonKind is a natural products company
with offices in Florida and New York City. The company’s first brand, SuperDetoxMe, launched in September online and in select specialty retailers in the northeast. Each of the brand’s five SKUs are vegan, allergen and gluten-free, Kosher, non-GMO and free of any additives and preservatives. Temple Turmeric released seven new varieties in 2015, bringing the company’s total offerings to 15. For the upcoming holiday season the brand will release two new varieties exclusively at Whole Foods: Pure Fire Cider and Holiday Spiced Lassi, which are inspired by ancient recipes and powered by the company’s proprietary Hawaiian Oana Turmeric. Sweet’tauk’s four high pressure processed lemonades are now available in select Whole Foods Markets in New York City and Long Island, as well as over 100 specialty stores in New York, New Jersey, Connecticut and Massachusetts. Sweet’tauk is also introducing a fifth offering called Zero Hero, made with monk fruit and hibiscus. ZICO has expanded flavor and packaging options of ZICO Chilled Juices, the brand’s line of chilled coconut water and fruit juice blends. In addition to the existing 1.5 mL at-home packaging, ZICO Chilled Juices are now available in 500 mL not-fromconcentrate Tetra Pak cartons for on-the-go consumption. The brand’s also adding a Strawberry Banana flavor, which joins Orange, Pineapple Mango and Natural in Zico’s Chilled Juices portfolio.
select Whole Foods and other specialty stores throughout Massachusetts. Garden of Flavor has launched Tomato Tonic, an organic, cold-pressed tomato-based juice. Made with fresh tomatoes, garlic, jalapeno, cucumber, celery and cilantro, the product also includes GanedenBC30 probiotic cultures. Each 16 oz. bottle provides four servings of vegetables. The juice blend is available in natural and grocery retail outlets. Uncle Matt’s Organic has added two new varieties to its line of organic juice products. Uncle Matt’s Orange Turmeric contains 500 mg of turmeric per 8 oz. serving and 120 percent of the recommended daily value of Vitamin C. The brand’s Reduced-Calorie Orange Coconut contains 70 calories per serving. It has B vitamins, natural electrolytes and vitamin C. Both varieties are infused with the probiotic GanedenBC30, which contains over 1 billion CFUs per 8 oz. serving. Offered in family-friendly BPA-free 59 oz. packaging, the new juices are gluten-free and have no added ingredients, flavors, or preservatives. They are available in select Whole Foods and Kroger stores nationwide. Bai has added an eighth flavor to its carbonated ‘Bubbles’ line: Sulawesi Limon. The new addition will be available exclusively on Amazon.com and Drinkbai.com beginning in October before a wider Spring/Summer 2016 retail rollout. Honest Tea introduced a Watermelon Lem-
Wellness Shots this Summer in five unique varieties: Liver Flush, Flu Shot, Turmeric Tonic, Tummy Tonic and Mineral Surge. The company has also introduced a ‘Get Up And Go Go” blend made with cold brew coffee.
onade to its “Summer Refresher” line extension this summer, joining Honest’s Original Lemonade, Mango Lemonade, Mint Limeade and Half & Half Lemonade & Tea flavors. Sweetened with Fair Trade Certified cane sugar, the new offering was made available exclusively at Whole Foods in 32 fl. oz glass bottles for a retail price of $2.49 per bottle.
MAKOMAS is a certified Minority and Women-Owned Business Enterprise using sustainably grown premium organic fruits, flowers and roots to create unique beverages. The brand’s hibiscus tea, baobab and ginger drinks are made with only three or less major ingredients. MAKOMAS can be found in
Hubert’s Lemonade launched a new Blood Orange flavor in March, ahead of the brand’s handoff to Coca-Cola’s Venturing and Emerging Brands division. The transfer in ownerships follows Coke’s purchase of a 16.7 percent stake in Monster Beverage that finalized in June.
Project Juice launched a line of 2 oz.
50 SEPTEMBER 2015 BEVNET MAGAZINE
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KOMBUCHA CATCHES UP ON THE EAST COAST By Neil Martinez-Belkin
David Warner still wasn’t 100 percent sold on kombucha when he decided to start stocking GT’s at his Boston-area neighborhood grocer, City Feed & Supply, back in 2007. “You know, I wasn’t sure if it was that interesting of a drink,” Warner says. “But there were some folks requesting it and I knew people were looking for flavorful, low-sugar beverage options.” Aside from the usual smattering of local brands, kombucha had only been commercially available on the East Coast in a ready-to-drink format for two years at the time, after GT Dave went national with his fermented probiotic beverage brand 52 SEPTEMBER 2015 BEVNET MAGAZINE
in 2005. But on the West Coast, kombucha was bubbling in more ways than one, gaining real traction in California’s health and wellness circles for its reported health benefits, which started with gut health and extended as far as claims that the beverage could treat cancer. Ten years later and kombucha’s a lot more than just your mother’s scoby. It’s a $600 million global beverage category, one that market research firm MicroMarket Monitor projects to grow to $1.8 billion by 2020. So where’s this growth happening? Is the West Coast still carrying the category? Did the East Coast convert to
California’s cult of kombucha? Maybe not all the way, but the disparity between the two seems to be slimming. “Two years ago, if you were to take the best California stores for kombucha sales and compare that to the best North Carolina or Florida stores, the numbers would be almost five times better,” says Rachel Zarrow, Vice President of Marketing at San Francisco-based Clearly Kombucha. “But this year something is different. The same comparison still skews California but only by a two times factor.” It’s clear that Clearly Kombucha isn’t alone. San Diego-based Health Ade just brought on beverage industry veteran
Ned Desmond, formerly of Nantucket Nectars, as East Coast Director of Sales, a position brought on in response to the brand’s recent entry into Whole Foods’ Mid-Atlantic region and its East Coast growth on the whole. “The consumer for the category is really changing,” Zarrow says. “It’s not just for yogis and hardcore vegans, it’s becoming more of a mainstream category.” Chris Reed, founder and CEO of craft soda company Reed’s, saw that opportunity for kombucha beyond the natural channel when his company entered the segment in 2012 with Reed’s Culture Club Kombucha, introducing a “lighter, more palatable” kombucha to consumers outside the product’s traditionally diehard crunchy crowd. Leveraging the company’s existing relationships with over 100 supermarket chains. Reed’s quickly became the number two national brand behind GT’s, albeit still a distant one. Reed credits the East Coast catching up to kombucha to health conscious consumers with a growing interest in probiotics in addition to the natural regional progression of health foods and beverages. “The West is going to lead, and then
it jumps over to the East Coast,” he says “From there it spreads across the periphery of the country making its way into other big cities and eventually into the rest of the marketplace.”
TEN YEARS AGO IT MADE SENSE TO LAUNCH A KOMBUCHA BRAND ON THE WEST COAST BECAUSE THE WEST WAS THE FIRST TO BE EXPOSED TO KOMBUCHA EARLY ON, BUT TODAY’S CONSUMERS ARE MORE AWARE THAN THEY’VE EVER BEEN REGARDLESS OF WHICH COAST THEY RESIDE ON. GT DAVE – GT’S KOMBUCHA
But there’s still a sizeable lag. While not a kombucha, the growth rate of probiotic product Goodbelly offers an interesting parallel: its growth rate mirrors that of GT’s, up 50 percent over the last 52 weeks according to SPINS data,
but according to CEO Alan Murray, the brand is still growing 50 percent faster on the West Coast than the East. Numbers aside, the regional imbalances that remain are still apparent at industry trade shows: many fewer kombucha brands show up for East Coast natural product or fancy foods shows than they do the West. The largest brands remain headquartered on the West Coast as well. As for GT Dave, the kombucha category’s kingpin says that times have changed, likening the category’s success to that of coconut water and fresh-pressed juice. Dave also says he believes that the food and beverage trends once associated so strongly with the Golden State now know no geographic restrictions. “Ten years ago it made sense to launch a kombucha brand on the West Coast because the West was the first to be exposed to kombucha early on,” he says. “But today’s consumers are more aware than they’ve ever been before regardless of which coast they reside on. There’s opportunity for kombucha in many areas you might not expect, and it’s all linked to the ever-evolving awareness and consciousness of the consumer.”
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Brand News Health-Ade kombucha is expanding its avail-
ability at Whole Foods, entering the Southwest and Mid-Atlantic regions. To assist with the expanded distribution the company has hired beverage veteran Ned Desmond to serve as East Coast Director of Sales. They plan to announce new flavor additions in 2016. Lifeway Foods’ new protein kefir smoothies
hit shelves in September, entering an array of retailers, including Mariano’s/Roundy’s, Harris Teeter, Acme, Bristol Farms, and Whole Foods’ Midwest region. The new offering will be sold in 16 oz. bottles in Banana, Salted Caramel, Mixed Berry and Vanilla flavors. High Country Kombucha is adding three new
flavors to its roster. Brewed from Rocky Mountains spring water, High Country Kombucha is non-GMO and USDA-certified organic. Kevita is rolling out new packaging for its
sparkling probiotic drinks as the company ramps up its efforts for its “Truth-in-Labeling” campaign, which is striving to require more kombucha companies to place “Verified Non Alcoholic” stamps on their labels. Karma Probiotics. Karma Probiotics stores its
probiotics and digestive nourishment in its cap until you release them. It is formulated with the patented Ganeden BC30 probiotic and each 18 oz. bottle contains two billion cultures, with no refrigeration required. The brand is available in three flavors: Apple Cinnamon, Blueberry Lemonade and Berry Cherry. LIVE Kombucha Soda released two new flavors in 2015: Pomtastic Blueberry and Refreshing Rhuberry. The brand is now available in more than 3,000 retailers nationally. Fire Cider is now available in an unsweet-
ened format, in 8 oz. and 16 oz. glass bottles. Suitable for diabetics or those on a low glycemic diet, Unsweetened Fire Cider is USDAcertified organic, raw and vegan. Shaktea kombucha is now available at over
60 Hyvee Health Markets across the Midwest, as well as select Whole Foods Markets in the region. Shaktea’s seven flavors are brewed with fair-trade organic tea, non-GMO organic cane sugar and whole organic fruit. 54 SEPTEMBER 2015 BEVNET MAGAZINE
Probiotic Beverages GoodBelly’s new 15.2 oz. single-serving probiotic drinks are free of dairy, artificial colors and flavors and are USDA-certified organic. The brand’s new offering is currently available exclusively at Sprouts Farmer’s Markets in Mango, Blueberry Acai and Tropical Green. Humm Kombucha, based in Oregon, is now available in 16 states through partnerships with Natural Grocers, Safeway, Albertsons Haggen and WinCo. In June, the femaleowned company signed a distribution agreement with Los Angeles-based Haralambos Beverages to bring the brand’s entire line of kombucha to Southern California. Genki Su is an all natural, fruit-infused drinking vinegar available in five flavors - Yuzi Citron, Nashi (Asian Pear), Hawaiian Ginger Honey, Shisho (Japanese Basil) and Oregon Cranberry. Genki Su is currently sold in natural grocery stores in the Pacific Northwest and online at www.genkisu.com BELLABUCHA has introduced two new flavors to the Costa Rica-based brand: Masala with Vanilla Bean and Very Berry with Raspberry. This Fall the company will move operations to a larger brewing facility in the country’s capital of San Jose. Dahlicious has undergone a rebrand and will emerge this fall with a new line of lassis made from 100 percent grass-fed, non-homogenized, organic whole milk. The conventional Dahlicious product will be discontinued and eight new flavors will be introduced. Clearly Kombucha has unveiled a new label
redesign to coincide with the brand’s national expansion into national retailers including Sprouts Farmers Markets and Kroger. Now available in over 2,000 stores, Clearly Kombucha comes in seven flavors. Confluence Kombucha is a St. Louis-based
brand concerned with producing highly functional and intensely palate-pleasing beverages. A tasting room is in the works to give the brand’s customers a space to be educated on the ancient elixir, while also being able to experience flagship brews and weigh in on experimental batches.
KIDS DRINKS: THE SEARCH FOR MILLENNIAL MOMS BY JEFFREY KLINEMAN
CLEAN IT UP, TEAM. THE MILLENNIAL MOM IS HERE, AND she’s health-conscious and wired. There are at least 9 million of her, according to a study from the advertising agency WeberShandwick, and her buying power and influence will extend to the offspring of the largest generation since the baby boom. Weber Shandwick presented seven characteristics of the millennial mom: • Highly connected, with more social media accounts than moms overall • Highly influential – they are asked for their opinion a lot, and they offer it unsolicited even more, when compared to total moms • They talk about products and services – 90 percent of them share information about groceries and food
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• They have a different idea of what it means to be a mother – 32 percent are single/never married/not cohabitating with a partner; 33 percent are the top earner • They split pretty evenly between full-time workers (30 percent); part-time workers (35 percent) and “homemakers” (35 percent) • They like to outsource – about ¼ said they’d pay $50 per month to manage their busy lives, and about ¹/8 said they’d go as high as $150 • They are more likely than other moms to share grocery decisions So in reaching her, your reputation is important, and the delivery method is shifting – they’re wired, and they’ll use other methods of shopping. Put another way, if a category captain gets a highly groomed space in the shelf-stable juice aisle and there’s no
one there to see your promo, does it really sell? For brands both old and new, it’s an important tautology. How, then do you get them, knowing that even if they aren’t making the final purchase decisions, they’re highly influential on their partners and kids? There are the bloggers, for one – a group of more than 14 million mothers – the troops in the army of sharing. While those blogs are by no means unified in their statements, according to experts, a plurality tend to deal with healthy lifestyle and eating choices. And the key is dialogue, according to another study of millennials that addresses the mom-blogger beat. According to research firm BrandKeys, much of the bond to brands by these groups is an emotional one, rather than a rational one. They’ll be brand loyal as long as they feel they can reach that brand and have a back-and-forth. Internet and mobile devices make information gathering about products an easier process, so the key is to create a social attachment. According to BrandKeys, that means they want to be able to “talk to brands” and “feel listened to” by them. That’s not the only way, of course, but new brands need to work to get these people to jump from hard-to-beat Capri-Sun and CSD pricing. Fortunately, the powers-that-be are helping to clear the path: the three major fast-food chains have moved away from sodas as an option in their kids meals. That would be even better, of course, if those chains weren’t also losing customers, but nevertheless, it creates the milk-or-water dynamic that many households desire. And one other place that’s only losing a few customers are schools, and new regulations concerning what can be offered to drink there are definitely on the side of emerging brands – if they can navigate the byzantine rules governing the vending and contract process. Of course when dealing with lunchboxes, even lower-cost options are on the table – lots of families are moving to tap water or bottled water for their kids, and that doesn’t bode well for entrepreneurs who might be trying to reach the next generation of Whole Foods shoppers. So they need to make different arguments to reach the millennial mom. Here are some ideas from the marketplace that might influence them to pick up new, different products that are focused on growth: Your kids can be healthier: that’s the high-end juice drink argument, one made by products like Green Mustache and Daily Greens’ Half Pint line. At nearly $4 apiece, it’s a tough investment – but the concept is that these drinks are also meals or snacks, part of the diet, and accretive to overall health Your kids don’t have to drink Capri Sun – but they can drink something like it: that’s the brand argument being made by both Honest Tea and Juicy Juice with their Honest Kids and Splashers lines. Now, the price points and the brand values are different, but the restaging of the pouch as a lower sugar, more juice-focused 58 SEPTEMBER 2015 BEVNET MAGAZINE
product is a compelling one. (CapriSun itself took out high fructose corn syrup earlier this year, although it remains a juggernaut in terms of being a low-cost lunchbox throw-in) Your kids can drink the brands you drink – Zico Chocolate, Vita Coco Kids, the aforementioned Honest Kids, Rooibee Roo, are all offshoots of products that have strong millennial audiences and are moving toward the next generation through on-ramp products Your kids can drink what you drink – Similarly, zero-calorie drinks like Sparkling Ice, LaCroix, and low-calorie products like Bai are finding their way into the lunchbox. LaCroix, in particular, is reaching out through Instagram. Your kids need variety: a study from the American Journal of Pediatrics indicated that more than half the kids aged 6-19 they tested were inadequately hydrated. While water is the best hydration source, according to the study, adding an extra drink for variety can be enough to provide the fluids needed to provide enough hydration. Note that the kids weren’t, as one researcher put it, “dropping like flies,” but that they may have had headaches or been irritable. Communicate, provide points of difference, and address specific, evolving, beneficial need states and you’ve got a chance. But if you’re going to wade into the kiddie pool, remember, the millennial moms have new rules – and they are plenty willing to blow the whistle. ASEPTIC JUICE DRINKS Brand
Change vs. year earlier
Kool Aid Jammers
Apple & Eve Fruitables
Capri Sun Super V
V8 V Fusion
Motts for Tots
Minute Maid Coolers
Apple & Eve Organic Quenchers
Nestle Juicy Juice Fruitables
Vita Coco Kids
SOURCE: IRI, a Chicago-based market research firm (@iriworldwide) 52 Weeks through 7/12/15
Brand News good2grow has introduced a new line of
USDA certified organic ‘Juicy Waters’ in two flavors - Grape and Fruit Punch. Like the rest of the brand’s offerings, Juicy Waters contain no added sugar, no artificial colors, flavors or preservatives and are non-GMO. Sneakz Organic has added a Vanilla Milkshake flavor to its line of “deliciously disguised” vegetable nutrition shakes. Each milkshake contains ½ serving of vegetables by way of a blend of carrots, cauliflower, sweet potato and spinach. Giggle sparkling water recently launched
in two flavors - Orangerrific Awesome Fizz and Lemonlicious Awesome Fizz. The USDA certified organic and certified kosher brand contains less than 15 calories per 8.4 oz. can and is naturally sweetened with less than 2g of sugar. Little Me Tea released two new flavors to its existing line of tea + fruits + veggies juice boxes for kids. Fruit Punch Tea and Berry Tasty Tea will complement the brand’s existing Julia’s Tropical Tea and Zane’s Grape Tea flavors. Little Me Tea has expanded its distribution to more than 750 stores, including three regions of Whole Foods, Meijer, Natural Grocers by Vitamin Cottage, Festival Foods, Farm Fresh and PCC Natural Markets, among others. Nestlé Pure Life has introduced new “Share A Smile” packaging on its kid-friendly 8 oz. bottles ahead of back to school season. The eight new labels offer “encouragement, inspiration and laughs,” according to the company. Drazil Kids Tea will be expanding nation-
ally in 2016. The brand is currently available on the West Coast at retailers such as Whole Foods and Safeway and will be entering the Midwest market this Fall. The naturally caffeine-free herbal tea infused with fruit juice is sold in 8-packs of 6.75 oz. bottles in four flavors: Punch Passion, Yummy Berry, Tropical Burst and Grape Bliss. Daily Greens has crafted a trio of kidfriendly, nutrient-dense smoothies. Available exclusively at Whole Foods, the new
60 SEPTEMBER 2015 BEVNET MAGAZINE
Kids Beverages ‘Half Pint’ line is available in three blends: Peel Out, Green Thing and Berry Tasty. The brand has also pledged to donate 10 cents from each bottle sold to the Whole Kids Foundation to help fund school gardens, salad bars and nutrition education programs for teachers and staff. True Drinks recently updated the labels on its AquaBall Naturally Flavored Water to better emphasize that the product is a zero-sugar, zero-calorie water drink. Each AquaBall now features a ‘0 Sugar’ badge highlighting this market differentiation. AquaBall is available in 12 oz. singles, 6-packs and 16 variety club packs in four flavors: Fruit Punch, Orange, Grape and Berry Frost. MilkSplash has introduced a new ‘Natural
Ingredients’ line of the brand’s zero-calorie milk flavorings. MilkSplash NI is made with natural flavors, sweeteners and colors and contains no preservatives. The new line available in Cocoa Loco, Sir Strawberry Swirl and Jammin’ Banana flavors - began entering nearly 1,000 Target stores nationwide in July. Tum-E Yummies has introduced a multi-
pack line extension of its fruit flavored water drinks, sweetened with a blend of real sugar and stevia. The new blend is available in 6-packs, while the existing formulation will continue to be offered in 12-packs and individual bottles. The new line made its debut throughout the Southeast and mid-Atlantic in grocery and mass merchandiser stores such as K-Mart, Ingles, Harris Teeter, Food Lion and Lowes Foods. Harvest Hill Beverage Company has added several new products to its Juicy Juice line of kids’ juices. The company launched new Strawberry Watermelon, Passion Dragonfruit, Peach Apple and Cranberry Apple flavor varieties to its line of 64 oz. bottles, with Strawberry Watermelon and Peach Apple also packed in 6.75 oz. juice boxes. The company has also introduced Juicy Juice Splashers, a line of juice drinks packaged in 6 oz. pouches. The products are sweetened with fruit juice and contain no artificial ingredients. They are available in Fruit Punch, Berry Lemonade, Peach Mango and Tropical Twist varieties.
ÂŠ 2015 Honest Tea, Inc. All rights reserved.
DRESSED FOR THE PRESS PACKAGING IN THE TIME OF HPP By: Neil Martinez-Belkin Hey, is it just us or are all these cold-pressed juice brands starting to look the same? Look, we get it, these guys are spending a lot of their money on produce, and custom mold bottles don’t come cheap. But the juice game is changing. Thanks to the cold pasteurization technology known as high pressure processing (HPP) - which has extended these juices’ shelf life to up to 45 days - the cold-pressed category has left the juice bar. So much so that in August, The Coca-Cola Company made a $90 million investment in San Diego-based Suja Juice. This probably goes without saying, but a brick and mortar juice brand and a Coke-backed one operate under entirely different sets of rules. So as the business of HPP juice continues
62 SEPTEMBER 2015 BEVNET MAGAZINE
to expand into more conventional retailers, the importance of packaging choices has increased, with brands competing for consumer eyeballs alongside one another in the cold case. Because of the intense pressure in the processing machines, the HPP process does have some restrictions, most prominently no glass. But the homogenous look that’s been seen across the segment might have more to do with the startup nature of these brands and that they’ve elected to allocate their resources outside of expensive custom mold bottles, rather than any significant technical structural limitations, experts say. “A bottle’s shape actually isn’t really relevant for HPP to do what it’s supposed to do,“ says Joyce Longfield, an independent consultant who works with HPP machinery manufacturer Hiper-
baric. “If the bottles provide some headspace, the plastic has 15 percent compressibility and they fit into the carrier, those are the properties that are really relevant to the packaging.” So what about the label designs for these beverages, with their transparent bottles and white font lettering? The template for package design in the HPP juice segment came from Blueprint Juice, whose clinical, entirely ingredient-focused approach captured the cleanse crowd aesthetic. Upon Suja’s inception in 2012, Jeremy Dahl and Becky Nelson of San Diego design firm Bex Brands took an alternate approach, shifting away from Blueprint’s exercise in minimalism to a busier, friendlier bottle aimed at inviting more mainstream consumers into the fold. But at their core, both Blueprint and Suja let their juice do the talking, having their design work play second fiddle to the beauty of the premium product behind them. That aesthetic is what’s driven the look of the bulk of the brands that have emerged since. “You don’t want to over package this kind of product,” says Paula Grant, founder and CEO of Flood Creative, a boutique design firm out of New York. “What you’re selling is the fresh juice and that is what is really supposed to look spectacular.” Still, there’s room to color outside the blueprint, pun intended. Last year Grant featured colorful fruits and vegetables on a jet black label in a packaging revamp for o2 Living, a health and wellness brand out of Cross River. The Fuze co-founder’s work with o2 living would go on to win her firm an American Graphic Design Award earlier this year. Fellow Big Apple designer Jody Levy also made some bold packaging choices when introducing her cold-pressed juice brand
WTRMLN WTR in 2013. Concealing the contents of the bottle behind a nearly full shrink sleeve, the design emphasized the product’s humble beginnings as a watermelon more so than the finished product, and the label’s back panel promotes the juice’s functional benefits in a playful, more personal approach. When WTRMLN WTR launched a lemon-infused line extension a year later, its bright yellow lemon rind label moved even further away from the category’s less-is-more status quo. “We have a brand promise of quality and that’s never compromised” Levy says. “But really that’s the baseline. In order for brands to succeed, in every industry, there’s a need to be that personal connection with the consumer.” So as the category continues to grow, what might the future of high-pressure-processed beverages look like? What will a Coke acquisition of Suja entail? Blake Mitchell of Boulder-based firm Interact on Shelf is of the belief that there’s opportunity in the category for a brand to plant its flag in the segment with a logo akin to the Nike Swoosh or McDonald’s arches. “The most iconic beverage brands - Coca-Cola, Pepsi, Monster, Gatorade - their brand identity is the highlight of their package,” says Mitchell. “With these HPP drinks, there’s room for someone to come into this space and visually disrupt it with a big brand mark and letting that do the heavy lifting. At the end of the day consumers recognize before they read. You can always choose whether you want to read something but you can’t choose whether you recognize it.” Until then, though, it might be the bottle that’s more recognizable than the brand.
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Naked Juice Launches #DrinkGoodDoGood Social Media Campaign
Organic Valley Launches "Brononymous Hotline"
Naked Juice, a division of PepsiCo, is once again partnering with Wholesome Wave – an organization that helps create affordable access to fresh, local and regional food to those in need – to provide fresh produce where there are few options. As part of its “Drink Good. Do Good.” campaign, Naked Juice is committing to donate up to 500,000 pounds worth of fruits and vegetables to Wholesome Wave. New this year, Naked Juice is asking people across the country to join the effort. The company is asking individuals to take a photo of themselves holding a fruit or vegetable and post the image on social media with the hashtag #DrinkGoodDoGood. For each one, Naked Juice will donate the equivalent of 10 pounds of produce to neighbors in need. In addition, Naked Juice and Wholesome Wave are teaming up with local ambassadors across the country to help shine a light on the issue of food deserts. Among the ambassadors joining the effort are actor and philanthropist Adrian Grenier, Wholesome Wave board member and D.C.-based chef Jose Andres, Chicago-born actor, musician and philanthropist Common, and Los Angeles chef Michael Voltaggio.
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In a follow-up to its hit "Save the Bros" campaign earlier this year, Organic Valley, one of the nation's leading organic brands, is launching a sequel to educate consumers about the benefits of Organic Fuel, the first-ever organic milk protein shake. The integrated social campaign launched in August at SaveTheBros.com and features the "Brononymous Hotline," an anonymous Twitter outreach program aimed at the millions of bros who don't realize the potential dangers of chugging protein shakes made with scary chemicals and artificial ingredients. Packed with 26 grams of milk protein, 70 percent of the recommended daily
intake (RDI) of calcium and no artificial sweeteners, Organic Fuel is an ideal combination of protein and carbohydrates for powering muscles and aiding in post-workout recovery. People who visit the Brononymous Hotline can anonymously help a bro by entering his Twitter handle and selecting from a number of reasons why he's worth saving, such as his knack for perfecting the art of hair sculpting or preserving the ancient art of tribal tattoos. Each of the seven videos reminds viewers to "please protein responsibly." The Brononymous Hotline will then tweet at your bro with a personalized video and a coupon to try Organic Fuel.
fairlife Gives Aspiring Six-Year-Old All the Milk “His Little Belly Can Hold” Fairlife ultra-filtered milk has awarded a lifetime supply of fairlife to six-year-old Ann Arbor, Mich., resident Brady Carpenter, thanks to the precocious question he posed to a head college football coach at a recent press conference. To the coach, Brady asked, “How much milk do I have to drink to be big enough to be quarterback?” The response? “As much as your little belly can hold.” Delighted with Brady’s question, fairlife has provided him with a lifetime supply of fairlife ultra-filtered milk to fuel his journey of becoming a quarterback. fairlife ultra-filtered milk is cold-filtered for 50 percent more protein, 30 percent more calcium and half the sugar than typically found in milk – a result of its patented coldfiltration – without adding any protein or calcium powders. fairlife uses the high quality milk provided by a co-op of American dairy families who lead the industry in their commitments to milk quality, humane animal care and environmental sustainability. In addition to receiving a lifetime supply of fairlife ultrafiltered milk, Brady received a personal tour of fairlife’s flagship dairy farm in Fair Oaks, Ind.
Shock Top and Indiegogo Partner for Drought Relief In response to the critical drought situation in California, Shock Top announced that it has partnered with Indiegogo and state water organizations to launch Shock the Drought, a program to identify, fund and distribute water-saving innovations that have the potential to make a real impact on reducing water usage in the state. Every month this year, Shock Top will fund an impactful water-saving invention on Indiegogo, spurring water conservation projects past their fundraising goals and releasing thousands of products to a state thirsty for solutions. In the meantime, discover, pledge and adopt water-saving tips at ShockTheDrought.com. In collaboration with its partners, Shock Top will identify breakthrough products from inventors around the world via crowdfunding platform Indiegogo that can make a big impact on water conservation. To kick things off, Shock Top will deliver $100,000 in funding for Drop-A-Brick 2.0, a modern, ecofriendly innovation that sprang from the classic drought tactic of
placing a real brick in a toilet’s tank to save water. Today’s DropA-Brick is made from rubber to prevent damage to the tank and improves flushing performance, all while saving about 50 gallons per week. By funding a 2.0 version, Shock Top will help save millions of gallons of water across the state of California each year. In fact, 30,000 Drop-A-Bricks in toilets will save enough water for nearly half a million people to drink water for an entire year. Tens of thousands of bricks – and future products – funded by Shock Top will be donated for free to partner organizations to be distributed throughout California areas hardest hit by the drought. To broaden awareness, Shock Top has partnered with news platform Water Deeply, California’s statewide conservation education program Save Our Water, Los Angeles water education program Save the Drop, and the Solano County Water Agency to provide tips, information and educational materials for the Shock the Drought campaign.
Talking Rain and Sparkling Ice Team Up With NFL’s Seattle Seahawks Talking Rain Beverage Company, the makers of Sparkling Ice, has announced a partnership with hometown team, the Seattle Seahawks. Talking Rain and Sparkling Ice will align with the Seattle Seahawks as the exclusive sparkling water sponsors of the NFL team. The multi-year partnership will feature co-branded Seahawks Talking Rain and Sparkling Ice products, on-premise and off-premise advertising and retail availability and distribution. Joined by Marcus Trufant, former Seahawks cornerback and hometown fa-
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vorite, Talking Rain kicked off the partnership today during the Seahawks Training Camp at the Virginia Mason Athletic Center. In front of nearly 2,600 attendees, Trufant fearlessly leapt out of a Sparkling Ice branded airplane, landing amidst Seahawks trainees to announce the collabo-
ration. Attendees were gifted with samples of the new Talking Rain, Sparkling Ice and Seattle Seahawks co-branded products. As a way to honor loyal Seahawks fans, also known as "The 12s", Sparkling Ice will launch a custom variety 12-pack, which will feature Seattle Seahawks branding on the packaging. Talking Rain's Sparkling Mountain Spring Water will also showcase the team's branding on the Natural and Lemon Lime flavors. These custom offerings will be available at select retailers in Washington State.
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The September 2015 issue of BevNET Magazine.