Recess-Breakthru Partnership Continues CBD Distribution Wave
For as long as we’ve been tracking the rise of CBD beverages, the question remained as to whether or not retailers and distributors would join brands in making the leap into the yet-undefined space and get their products onto store shelves. But this summer, a handful of major independent wine and spirits distributors have signaled their intent to break the impasse.
If you’ve been following the Distribution Roundup in recent weeks, you’ve no doubt noticed the trend already. Southern Glazer’s has been at the forefront of that push, making headlines with the announcement in June of its partnership with Canadian cannabis firm Canopy Growth to distribute its portfolio of CBD-infused beverages in the U.S., starting with CBD-infused sparkling water Quatreau in seven states. According to the distributor, this month’s deal with MAD TASTY, the CBD sparkling water play founded by OneRepublic singer Ryan Tedder and backed by First Beverage Group (more news below), makes it the country’s biggest CBD drink wholesaler. That announcement came after energy drink Kill Cliff signed with Glazer’s last month, with the aim of translating its strong online momentum into a bigger retail footprint. Elsewhere, Republic National has also put a stake in the ground with CBD, bringing on Daytrip, Oh Hi, Sati Soda and Wyld to stores in Alaska, Colorado, Florida, New Mexico, Oklahoma, Oregon and Texas.
Now you can add Breakthru Beverage Group, one of the leading beverage alcohol houses in North America, to that list of names: yesterday, the distributor announced its intent to add “CBD and Relaxation” beverages to its portfolio by partnering with Recess to bring both its CBD and non-CBD products to stores across eight markets initially, before eventually expanding to 14.
In a press release, the company framed its entrance into CBD and Relaxation as a “logical extension” of its multi-year strategy towards investing in categories with long-term potential.
“We are excited to partner with Recess, an iconic brand that is playing at the intersection of some of the most significant emerging trends in the industry including greater consumer focus on mental well-being and the increasing demand for products that reduce stress; the rise of new functional ingredients such as CBD, adaptogens, and magnesium; consumer desire for alternative beverages; and the growth of functional beverages and sparkling water,” said Breakthru VP Drew Levinson, in a press release.
For Recess, on the cusp of its three-year anniversary of its launch, the partnership is a confirmation of the momentum behind CBD and anti-anxiety drinks as a category, with CEO and founder Ben Witte calling the collective involvement of Southern Glazer’s, Republic National and Breakthru a “huge catalyst” for the nascent space. The deal ticked off several important boxes by bringing Recess into new regions where it doesn’t have DSD support and enhancing its ecommerce architecture through integration on the distributor’s BREAKTHRU NOW serviceBut Witte noted that by taking on the brand’s full suite of products (including its recent non-CBD entry, Mood) Breakthru is aligned with his vision of relaxation beverages in general.
“They bought into the idea that we want to play in multiple categories over time, not just CBD,” Witte said. “That was important to us because it’s a fundamental part of our whole strategy. The fact that we are going to be able to work with such a large distributor across so many different markets with a cohesive category development and channel strategy is gonna be amazing. I think it’s one of the many catalysts that I think are coming to further the category.”
In some ways, the trend represents the continuation of a close relationship between the burgeoning cannabis industry and spirits companies. The shadow of Constellation Brands’ $4 billion bet on the category — in the form of its acquisition of Canopy — looms large, and as momentum behind changing federal regulations continues to grow (with much of the lobbying efforts funded by Constellation), FOMO may be starting to creep into to the minds of wine and spirits distributors.
Liquor distributors have also been more aggressive in pursuing CBD drinks than their beer counterparts. Clarification as to the legal status of CBD may help change that equation, and open the door for beer houses to leverage their existing infrastructure and capabilities to build in high-velocity channels like c-stores — an asset that the likes of Coca-Cola, Talking Rain, La Colombe and others have sought for their own products.
Mad Tasty Partners With Sprouts
After announcing a nationwide distribution pact with Southern Glazer’s earlier this month, hemp-infused functional beverage brand Mad Tasty revealed this week that its four-SKU sparkling water line will now be on the shelf at Sprouts Farmers Market stores in addition to a new flavor launching exclusively with the retailer: Yuzu Citrus. This first national supermarket partnership for Mad Tasty will expand the brand’s availability beyond its current 2,000 retail locations nationwide.
Mad Tasty COO Dan Holland said the brand’s distribution has exploded since their rollout with Southern and has grown even more through the partnership with Sprouts.
“Sprouts Farmers Market’s addition as first movers has created category and brand awareness among not only consumers but other retailers,” stated Holland. “We will definitely be the category captains.”
To complement its sparkling waters, the brand recently introduced a hemp-infused Wellness Boost shot line available in two flavors: Citrus Elderberry and Mango Ginger. Holland said more growth is on the horizon, including potential additional partnerships and entering eight new states over the course of the next two months.
Holland linked the brand’s fast growth to its ability to support its non-profit partner Drop4Drop; for every can of MAD TASTY sold, the brand donates the equivalent of 12 oz. of clean drinking water to communities in need by building wells. As of August, the company has built 10 wells so far this year, with the goal of building 20 more next year.
“The great thing about growing so rapidly is we will get to build more wells through our partnership with Drop4Drop,” he said. ”
Blk. Grows Retail Presence
Following its success on the retailer’s e-commerce platform, fulvic acid-infused alkaline water maker blk. has expanded distribution of its Original, Black Cherry and Dirty Lemonade flavored beverages to 500 Walmart locations, bringing the brand’s total store count to 25,000 doors nationwide.
“We’re proud to expand our partnership with Walmart, which has an extensive store footprint that will allow others to discover the amazing benefits that this functional beverage can provide,” said Sara Bergstein, CEO of blk in a press release. “We know that our product is unmatched in terms of nutrients. Fulvic acids have been utilized in many cultures for centuries and have been documented in hundreds of independent professional studies to remove toxins from the body, help with digestion, and more. Now customers can easily access these nutrients by picking up a bottle at a Walmart near them.”
Speaking with BevNET last week, blk.’s new VP of Sales, Bob Groux explained his hiring marks the brand’s shift in strategy toward growing its presence at retail. Groux highlighted blk.’s success on social media and the growth of online sales as well as noting it recently signed John Lenroe for San Diego-area distribution as well as opening its own DSD in Los Angeles.
BioSteel Arrives In Latin America and The Caribbean
After announcing its partnership with the NBA’s Los Angeles Lakers earlier this month, sports drink brand BioSteel has also joined WB Canna Co. & Wellness’ portfolio to expand distribution into Latin America, the Caribbean islands and additional travel retail opportunities. BioSteel beverages are sugar-free, support hydration and are packaged in TetraPak cartons.
“For years BioSteel has been the top name in sports hydration for professional athletes and fitness-minded consumers, and we’re very excited to bring these innovative products now to consumers in the Caribbean, Latin America and duty free,” said Phillip Jarrell, COO of WB Canna Co. & Wellness in a press release. “BioSteel is an important addition to the WB Canna Co. & Wellness portfolio as we continue to build a book of world-class wellness brands.”
For WB Canna Co. & Wellness, a subsidiary of wine and spirits distributor WEBB Banks, the addition of BioSteel marks the first non-CBD product in the distributor’s portfolio. As for BioSteel, this is the first time its products will be made available in the region.
7-Eleven Partners With MiniBar For Alcohol Delivery
National convenience store chain 7-Eleven partnered with Minibar Delivery to bring beer and wine directly to the doorstep of adult consumers via a pilot launch at over 600 locations throughout Florida, Texas, and Virginia. The launch will primarily serve city-area 7-Eleven locations in and near Orlando, Tampa, Fort Myers, Miami, San Antonio, Dallas, Austin, Fort Worth, Virginia Beach, Richmond, Norfolk and Alexandria.
“While delivery proved essential for many Americans staying at home, on-demand ordering and delivery has become an expectation – one that 7-Eleven intends to meet and exceed,” said 7-Eleven Digital Senior Vice President Raghu Mahadevan in a press release.
“This collaboration with 7-Eleven gives us the opportunity to work with the most iconic and innovative convenience retailer in the world and expand our presence in Florida, Texas, and Virginia, as well as other cities and states in the future,” added Lindsey Andrews, Minibar Delivery co-founder and CEO.
The retailer and the platform have plans to expand its partnership to 7-Eleven stores nationwide following the test run. 7-Eleven recently added a range of beer and wine to its national portfolio and will also distribute “Snacks & More” through Minibar’s delivery service.