A Snowman Bottle-Shaped Hole

Like the 250 lb body builder who used the weight machine before you, Muscle Milk is a hard act to follow.

The Cytosport-owned brand exploded across the nutrition store/convenience store barrier in 2008 and created a space for protein drinks at venues that more commonly host sugar waters, candy bars and hot dogs. Flying high on a decade of history in nutrition stores and surprising resonance with mainstream consumers, the brand snapped up distributors across the country, including such noted king-makers as L.A.’s Haralambos and New York City’s Big Geyser. It ascended so quickly that Pepsi Bottling Group announced a deal to snatch it away from the independent distribution network in November 2008, less than a year after it caught attention on mainstream shelves. That landmark deal created a snowman-bottle-shaped hole in some indies’ portfolios, leaving them and their retailers wondering: can another protein brand replicate Muscle Milk’s success?

Ed Jones, owner of Nutrition World in Chattanooga, Tenn. said he doesn’t think so. Muscle Milk built such a lead that he can’t imagine another product catching up to it.

“In 31 years of watching nutrition products come and go, sometimes there some magic that can happen,” he said. “Lordy, it’s a rare thing for that to happen.”

Despite Jones’ view, the roster of ready protein competitors runs deep. At least a dozen brands like BSN, Optimum Nutrition and ISS Research boast long track records in the same gyms and nutrition stores that launched Muscle Milk. They understand protein; they understand nutrition, and they understand that they want to enter the same lucrative market that Muscle Milk has tapped.

But the brand has left challenges in its wake – it didn’t just build a tremendous head start; it burned bridges. Spurned by Muscle Milk’s abrupt arc, Wright Wisner Distributing Corp. in Rochester, N.Y. fled the segment.

“There are other things coming along, and we just decided to put our efforts someplace else,” said Don Miller, Wright Wisner’s vice president of sales.

Many distributors, though, have been willing to give other protein brands a chance to prove their might. G. Housen in Vermont filled its Muscle Milk-void with Myoplex. Haralambos picked up both Myoplex and VPX Sports’ Protein Rush, while Great State Beverage in New Hampshire replaced Muscle Milk with four separate protein brands: Protein Rush, Lean Body, Myoplex and Sytha-6. Rob Tuck, a sales rep at Great State, said it took his company less than a month to find its first Muscle Milk replacement and, as a group, the distributor’s spectrum of protein products seems to be matching Muscle Milk’s sales.

“Each one is targeted to a different audience,” Tuck said.

Lean Body boasts zero sugar, he noted, while EAS backed Myoplex with a television ad campaign and both Sytha-6 and Protein Rush – with their 40 grams of protein and Tetra packaging – attract serious fitness store consumers.

More Space

Not all distributors are adding protein products to their portfolio to replace Muscle Milk. Jeff Howe, general market manager for Syntha-6 at BSN, said many of his distributors never carried Cytosport’s protein brand. Instead, they developed an interest in protein after Pepsi’s distributors urged retailers to open dairy cooler space for Muscle Milk.

The nascent market has led distributors to experiment with a smorgasbord of combinations. Howe estimated that half of his distributors handle at least one other protein brand, and half of those are trying to figure out which brands they should cut. Ultimately, they may maintain multiple protein lines, according to Lee Labrada, founder and CEO of Lean Body-maker Labrada Nutrition. The protein category has only begun to develop, he said, as a collision of demographics and cultural trends have set the foundation for a groundswell of fitness-focused beverages. With healthcare reform and obesity on the national radar, more young adults view protein drinks as good meal replacements, he said. At the same time, Baby Boomers entering their sunset years pay careful attention to their health and nutrition. Additionally, the television marketing campaigns waged by Muscle Milk and Myoplex are garnering attention from consumers who may have formerly viewed protein drinks as strictly for gym rats. Amid the accumulation of all those forces, Labrada said distributors may be wise to maintain multiple protein brands.

“In any market, there’s always room for a Coke and a Pepsi. There’s always room for a third- and even fourth- and fifth-tier brand,” Labrada said.

Those lower tier brands will likely bear names familiar to GNC shoppers, as the category presents unusual barriers to entry. According to Labrada, not only is protein expensive, but not all proteins are created equal. The human body will readily absorb and use milk proteins like those found in Muscle Milk and Labrada, he said, but has a harder time using cheaper collagen proteins. Additionally, as the flavor profiles of several fledgling protein drinks have demonstrated, protein is a difficult ingredient to work with. Body builders and their ilk have inoculated themselves to the taste, Labrada said – some even consume protein shots that pack as much as 42 grams in as little as two ounces – but the metallic taste can turn off the general public. Additionally, Labrada said, hardcore protein drink consumers tend to be highly brand loyal, making a Myoplex drinker unlikely to pick up a new entry.

Still, Labrada and Howe said they could see room for a newcomer to succeed. They’d fight long odds, considering that their better-established competitors can lean on already-successful powder businesses, but a brand like PRO FOODS’ PRO ADE could snap up consumers that haven’t already pledged their allegiance to an existing brand. The only long term risk, Labrada said, is that competition could lead to price wars, siphoning profits out of every point on the supply line.

Labrada said he thinks that’s why the Coca-Cola Co., Inc. and PepsiCo never got into the market before: protein is expensive and doesn’t provide enough profit for them. But that has changed. In addition to adding national distribution for Muscle Milk, PepsiCo debuted a handful of Gatorade recovery products with added protein. Coke added another flavor to its Odwalla Protein Monster line in May, and is planning a protein-enhanced Powerade product. In the mean time, a roster of nutrition shop brands and posing for entry into the independent distribution system. Only time will tell whether any of those brands can flex as well as Muscle Milk.