Burnin' – A Legend Fires up the Relaxation Business

He’s the perfect icon for a category whose growth story has always seemed more smoke than fire: Bob Marley, whose dreadlocked likeness is now emblazoned on a leading line of relaxation drinks.
For just as Marley legitimized the languorous reggae beat in the American heartland, so too is the company, behind namesake tea Marley’s Mellow Mood, creating a legitimate brand in the midst of what had been a mad scramble by nascent relaxation brands to sign up regional distributors through oddball news stories and marginal branding propositions.

Still, the emergence of legitimate brands in the relaxation category comes as a bit of a surprise. After all, what began as a counterintuitive joke when a California company rolled out Blue Cow as a contrast to Red Bull morphed within a few years into a minor media phenomenon with the arrival of products like Drank, Lean, Purple Stuff and Vacation in a Bottle (ViB).

But in the past two years, Marley and other brands, including Dream Water and Neuro’s Sleep variety, have gained mainstream accounts and wide distribution. Between Marley and Dream Water alone, the brands have gained more than 60,000 accounts, and their methods for doing so have involved more mainstream branding than the early party-hearty vibe of brands like Drank, Lean and Sippin’ Syrup. While those brands have musical ties as well, they also rely on their association with a slowed, druggy “chopped and screwed” hip-hop format as much as they do their inherent functionality, and the results seem to indicate that chain accounts are willing to try out the category from a less risky set of assertions.

That’s not so say that having peace-and-love-and-reggae-and-marijuana icon Bob Marley on a can evoking a mellow mood doesn’t evoke a visceral response: Marley Beverage’s makers are happy to say the brand does extremely well near (natch!) college campuses. But even if there’s some whiff of druggy connotation to the Marley name, it’s safe to say that it’s a much more ubiquitous presence and a much milder cultural touchstone than a musical format marked by its own founders’ fondness for a mixture of Sprite and Jolly Ranchers topped with codeine cough syrup (the “drank” and “lean” from which the names are ultimately derived). Marley’s “Legend” album is the watered-down Bacardi of musical releases, while chopped-and-screwed innovator D.J. Screw’s 1995 album “3 N’ Da Mornin, Part 2” sits at the fringe of the bar, somewhere near the absinthe and the pickled eggs.

Nevertheless, the one key ingredient that both Drank and Marley Beverage, not to mention Dream Water and other more culturally mainstream and financially secure brands, do have in common is that they all employ melatonin as the key sleep-inducing ingredient in their formulas. And with that key ingredient comes the element of risk, both from a regulatory and legal perspective, as well as from the court of public opinion, which has beaten down plenty of brands in the past.

There are other herbal elements in all of these products’ “relaxation blends,” but melatonin is the most potent from a sleep inducement standpoint, as well as the one one that has the most potential to draw fire from regulatory agencies due to its status as a dietary supplement. In fact, both Drank and a food product, “Lazy Cakes” – a melatonin-laced brownie – have already been stung by letters from the Food and Drug Administration about their packaging as traditional food and drink products instead of nutritional supplements.

The risk is enough to have already caused a change in strategy at Dream Water, which had been selling its product in both a 2 oz. shot format as well as an 8 oz. bottle. The move to a shot was to align the product much more closely with sleep enhancement than the more fun-and-relaxation branding of other brands, according to Dream Water COO Vincent Porpiglia.

“Any drink, any brownie, that’s a food,” Porpiglia said. “ Dreamwater is a shot now, and one of the reasons is because… we don’t want to be lumped into the category of a food-type product.”

But letters and comparatively small fines from the FDA are nothing compared to the kind of damage that can come from the agency if two other groups start targeting relaxation drinks: the media and the lawyers.
“The FDA is much more likely to take issue if there starts to be a rash of auto accidents or something,” said Justin Prochnow, a lawyer with Greenberg Traurig who regularly handles legal and regulatory issues for food and beverage companies, including Dream Water. “All it takes is a few of those, and the FDA starts coming down on people. The letter from two years ago leads you to believe it’s not at the top of their list of priorities – but if a rash of things starts to happen, the next thing you know, everyone’s involved. Publicity can light a fire under them pretty quick.”

As an example, he cites the way the FDA was prodded into issuing more direct sanctions on another category, the group of so-called “energy malternatives” encompassed by Joose, Four Loko, Liquid Charge, and many others. Despite some concerns, those products were growing rapidly until late 2010, when student death and injury created a cacophony of negative publicity that forced the agency to take a hard look at those products, eventually forcing their makers to stop adding caffeine to the drinks. Earlier this century, the FDA also banned the stimulant ephedra from all dietary supplements in the U.S. following the high-profile deaths of Baltimore Orioles pitcher Steve Bechler and Minnesota Vikings offensive lineman Korey Stringer. In both cases, media coverage and public outcry seemed to have the FDA working overtime.

Meanwhile, says Prochnow, the push from the FDA or from, say, state Attorneys General, who have also gone after beverage makers in the past, is nothing compared to the plaintiff’s bar. Under new California consumer protection laws, for example, he said, “plaintiff’s lawyers have been highly active. My bigger concern now isn’t the FDA, it’s some of the private consumers and their lawyers bringing action.”

Indeed, the current list of brands facing class action or civil suits over branding or advertising claims extends from beverages like coconut waters O.N.E. and Vita Coco to Vitaminwater into natural food stalwarts like Kashi. From a lawsuit perspective, times are fruitful, Prochnow said, and melatonin’s regulatory issues could launch a lot of civil suits.

The Main Ingredient
For relaxation beverages, melatonin has long served as a dividing line. It’s the only ingredient that is commonly used that qualifies as a dietary supplement rather than GRAS (Generally Recognized As Safe), which falls under very little oversight when used in a food. That opens the door to regulation by the FDA. But it’s also the key ingredient when it comes to fulfilling the functional promise of many of the drinks. While other botanicals like Kava-Kava, Rose Hips, valerian root and chamomile may have noticeable effects, melatonin, when it works, can be a sledgehammer of an amino acid, capable of inducing sleep to the point at which it has been known not just to help flight attendants deal with transatlantic jet lag, but also to helping night-patrolling Marines hack their body clocks so that they can fall asleep during daylight hours.

It’s also typically the ingredient that helps indicate the style of brand that a company makes: the presence of melatonin is what allows Dream Water to market itself as a sleep aid, that creates the difference between RelaxZen’s daytime and nighttime formulas.

“If you take melatonin, will you probably get sleepy? Yes,” said Porpiglia, whose product also includes GABA and  5-Hydroxytryptophan (5-HTP), both of which are included to enhance the sleep experience, another part of Dream Water’s emphasis.

“I can’t say that you can rule out the other ingredients, because (in the Dream Water formula) they do have some effect in conjunction with one another,” he added. “But I know a lot of companies just take a lot of things and throw them in along with the melatonin, but there’s really only one or two that work. That’s why they’re offering melatonin, you know that they’ll feel something. That’s one of the two or three that will make it happen. At the very least, companies are doing it because they know it’s the one that will have the strongest effect.”

One exception to the rule is Purple Stuff, a relaxation drink whose name evokes the heavy buzz of Drank and Lean (its owners attribute it to a throwaway line in a Sunny Delight commercial, however), but whose makers eschew melatonin.

“We started researching our product in October of 2007, talking with ingredient and flavor houses,” says Tim Lucas, the CMO of Funktonal Beverages Inc., which makes Purple Stuff. “When we looked at melatonin we saw that it wasn’t FDA approved (for use as a beverage). For us, that said that if a kid wrecks his car, if he gets hurt, an insurance claim would come back to us as gross negligence on the manufacturer. We knew we couldn’t do it.”

While such a case remains hypothetical, even the association with mayhem can bring down a product class. One of the key incidents that caused the FDA to go after Four Loko was a party at Central Washington University at which more than just that beverage was found by police, but also several other kinds of alcohol and a buffet of illicit drugs. Still, it was the Four Loko that drew the worst of the publicity.

Beverage makers are aware that melatonin’s effectiveness as a sleep inducer requires some warning on their part. Marley Beverage Company, for example, includes language on its Marley’s Mellow Mood telling consumers to “avoid driving or operating heavy machinery after consuming this product.”

There’s good reason for Marley Beverage to want consumers to take all kinds of care when drinking Marley’s Mellow Mood: the brand’s success in the past year means that it is in a situation where it has a lot more to lose than its competitors.

Marley is Burnin’
Last year Marley Beverage Co.’s Marley’s Mellow Mood (which contains, along with melatonin, other relaxation elements like valerian root*) and a non-relaxation focused coffee sub-line, One Drop, sold more than 1 million 12-bottle cases, said Kevin McClafferty, the president of Marley Beverage. The brand landed grocery accounts like Wegman’s and Stop and Shop, and convenience stores like Valero, AM/PM, Casey’s and Speedway on its way to getting placement in more than 40,000 stores – a number McClafferty says he expects to at least double in the next year.

“We’re blessed with a great brand,” McClafferty said. “We finished out the year strong, we exceeded a million cases in our first year, we’ve added 110 DSD partners, and we’ve got more opening soon. Things are rocking.”

It’s not the notion that melatonin will put a consumer to sleep that draws consumers to the brand, McClafferty says – but the opportunity to engage with the Marley legend and some of the associations with the stress-free, Rastafarian lifestyle so clearly associated with the international superstar. But the drink’s ability to induce a deeply relaxed state does help drive repeat purchase, he adds.

“We’re finding that they pick it up because of who is on the can,” McClafferty said. “Trial is driven by Bob and Bob’s image. People look at it and they’re happy to see it. They taste the liquid, and the first comments we tend to get are that ‘this tastes amazing.’ And then eventually they realize there’s some functionality to it. And that’s when they come back to buy more.”

With prominent shelf sets and the incredibly popular reggae star driving sales, the brand has a lot going for it, including the backing of many members of the Marley family themselves, who have helped promote the product while on tour. McClafferty said he is aware of the issues surrounding melatonin, and the effects that a wave of bad publicity can have on any beverage category.

“If you’re developing a branded functional line, you have to be cognizant of the ramifications of anything you’re dropping into your liquid, obviously,” McClafferty said.

“Lazy Cakes, things like that bring negative attention to the functional ingredient that we’re talking about,” he added. “We keep an eye on all of that, of course. We think about everything, and we’re 100 percent focused on consumer safety and making sure that our product is in line with expectations people would have of the brand.”

Right now, Marley – as it, and other melatonin-employing relaxation drinks, are required to be – is labeled as a dietary supplement, although, also like many other brands bearing that kind of label, it is sold in the beverage aisle or cold box.
But the company, it seems, hasn’t put all of its eggs in the melatonin basket. Given the ingredient’s issues, McClafferty said the company had indeed given thought to a non-melatonin formula.

“Marley’s Mellow Mood Relaxation Drinks have been ‘non –melatonin’-based in the UK since we rolled out overseas,” last Spring, he said. “The response has been great and the product is pulling.”

McClafferty also confirmed a recent test at one of their top retailers (Wegmans), on a melatonin-free formula, which delivered favorable results. The company expects to launch Marley’s Mellow Mood (melatonin-free) with them later in February.

“This type of activity gives us some terrific data, should we ever be asked to alter the formula,” he said.

Feeling the Effects
The Wegmans exception may be one concerned retailer drawing the line, or it might be indicative of more changes to come. Right now, however, one retailer’s concerns and a few sleepy consumers have not been enough to push beverage companies to steer clear of melatonin. In fact, having noticeable effects is one of the key objectives for functional beverage marketers, who watched energy drinks become a viable category at least partially because of the effectiveness of caffeine as a stimulant, and who have seen too many drinks fare poorly because they didn’t follow through on a functional promise.

Paul Nadel, the President of Neuro Beverage, spoke with BevNET in the fall about the importance of coming up with a product whose effects consumers can feel when it comes to establishing a functional brand.

“If you get a consumer who tries one and it works, like Sleep, they say ‘what else can I try?’” he told BevNET. “If just one works, it builds credibility.”

Similarly, the effectiveness of melatonin in products like Dreamwater, Drank, Marley, and others means that they can help the drinks establish a reputation that they work – and sometimes, a brand’s aura is more potent than any actual ingredient.

The Four Loko case can be particularly instructive in that regard. For it turns out that regulatory action didn’t turn out to be the death penalty for that brand. Even after the FDA forced the brand to take out caffeine, Four Loko’s continued use of a high alcohol formula with candy-like flavors and a flashy social media presence has allowed its legend to thrive. For that brand, at least, many of the lost sales have come back.

But the ability of a brand to supersede its ingredients is observed by more sectors of the industry than the beer business. In December, Mark Hall, the President of Monster Beverage Co., made it clear that while he believed “so long as there’s a Starbucks on every corner” energy drinks could stand up to any level of public outrage with regard to their caffeine content, if there was another problem ingredient, in most cases, he would just “take it out.”

Similarly, John Bello, the founder of SoBe, recently told BevNET that Pepsi was aware that there may have been some potentially controversial ingredients in some SoBe drinks at the time the company bought the brand from him – and that the company eventually simply removed them.

“Even when they took it out,” Bello said, “It had that ‘fourth dimension’ that went way beyond function.”

While melatonin fears may be a small element of the risk/reward equation covering the growth of the relaxation category, that branding question is still the larger one. Marley and Dream Water, at least, have begun to surge impressively onto retail shelves, but the category itself is still emerging: it remains to be seen if there is enough of a consumer need for them – or other relaxation brands – to pick up the repeat business that allows them to maintain a shelf presence.

But it’s an interesting situation, one that other new, effective, short-lead functional products have also dealt with as they tread the edge of the new beverage frontier:  the more repeat purchases there are, the more the products can run afoul of the concerns of the powers that be, whether those concerns, as Hall implied, are ultimately warranted or not.

At least they’re aware: searching for alternative formulas, tinkering with messaging and packaging, trying to find an edgy-but-not-too-edgy brand proposition, it’s got to make for extra stress when considering how tough trying the normal battle for shelf space can be.

It would be enough to keep someone up at night. But considering the business, it probably isn’t.

 

*(editor’s note: an earlier version of this story incorrectly stated that Marley’s Mellow Mood contains GABA and Kava-Kava. It does not.)