Staying within the theme of single-ingredient beverages, DRINKmaple has introduced DRINKmelon Pure Watermelon Water, a USDA Certified Organic juice made from domestically sourced watermelons.
DRINKmaple co-founder and CEO Kate Weiler told BevNET that the development of DRINKmelon was two-fold: extending the company’s distribution footprint – including the recent addition of Kroger stores – without introducing flavored varieties to its maple water line, and making efficient use of a new manufacturing facility.
“We understood the importance of adding SKUs to create a billboard effect in the store but we always felt maple water had such a great taste that we weren’t compelled to add flavor to it,” Weiler said. “[We’ve] always loved watermelon and we thought it spoke to our brand, being a single-ingredient product offering natural hydration with lots of beneficial properties.”
DRINKmelon will hit stores in June with a suggested retail price of $2.99 per 12 oz. bottle. Unlike high pressure processed watermelon beverage brands like WTRMLN WTR and H2Melon, DRINKmelon is pasteurized and shelf-stable. Weiler says the company wanted to create an on-the-go product that consumers “could throw in their bag on a hot summer day.”
Coco Community Launches from All Market Inc.
The company behind Vita Coco has launched a new brand, called Coco Community, with Nam Hom coconuts supplied by Thai coconut processor Cocos Enterprises. The brand will be organic, Fair-for-Life certified, single-origin and the company’s first entry into what CEO Mike Kirban is calling “the artisanal coconut water” segment.
Coco Community is sourcing its Nam Hom coconuts from the Ratchaburi Province in Thailand. Those coconuts are known for their sweet and nutty taste, according to the company.
While All Market-owned Vita Coco dominates the premium coconut water market, the segment that it defines as artisanal grew the fastest over the past year, powered largely by the momentum of high pressure processed Harmless Harvest, which pioneered the high-end tier and also uses Nam Hom coconuts.
The release of Coco Community is intended to give All Market a product that can compete for share in that market and the high prices it commands: a 500 mL bottle will carry a suggested retail price of $4.99, while a 250 mL bottle is expected to sell for $2.99. The products are expected to reach stores by May 1.
“The artisanal space has grown and it’s doing well as the category continues to segment,” Kirban said. Below the premium and artisanal space, he added, he sees the rest of the category segmenting into value-priced cans and private label products.
“As the ‘coconut water guys,’ we feel we have the ability to play in all of these segments,” Kirban added.
Cocos Enterprises, started by raw food enthusiasts Roman Devivo and Antje Spors, has supplied frozen, raw Nam Hom coconut water to other brands associated with that tier of the category in the past, including Harmless Harvest.
One key difference between the Coco Community and Harmless Harvest products will be heat: Coco Community uses flash pasteurization instead of HPP, a precautionary measure that Kirban says is the result of his company’s research into coconut processing.
La Colombe Pioneers a Draft Latte
Third-wave coffee company La Colombe has introduced its second ready-to drink beverage, a can-packaged “draft latte.” The beverage, a blend of espresso, milk and sugar that is infused with nitrous oxide, was designed to replicate the same frothy drinking experience as offered by the popular draft-poured lattes that La Colombe serves in its cafes.
La Colombe partnered with Crown Holdings to create the innovative package, dubbed the “InnoValve” can. Liquid gas is injected into the can through a valve at the bottom and expands when the can is opened, creating tiny bubbles that create a frothy texture.
CEO and co-founder Todd Carmichael said that despite the complex process of development and the can’s patent-pending technology, he views the beverage itself as a simple, yet premium, blend of coffee and milk that can appeal to a broad spectrum of consumers.
“I come from this world of third-wave coffee, where a great deal of time is spent in really overburdening the consumer with education,” Carmichael said. “It’s milk and coffee, which really isn’t a specialty thing at all. It feels special.”
The beverage has 120 calories and 14 grams of sugar (2 grams are added cane sugar, the rest is derived from the milk) per 9 oz. can, does not require refrigeration and has a shelf life of 180 days.
Q Drinks has raised $11 million in an investment round led by First Beverage Ventures, the private equity arm of First Beverage Group.
Premium mixers have been one of the hottest categories in the beverage business in the past few years and Q Drinks has led its growth, transforming the carbonated beverage aisle in many specialty and mainstream retail accounts. The company has also been an on-premise leader, earning free media coverage through use at hip restaurants and bars.
CEO Jordan Silbert has stressed financial discipline as well as a refined flavor profile in developing Q Drinks as a premium alternative to older brands like Schweppes and Canada Dry. Q Drinks has also benefitted from the parallel, rapid growth of independent high-end spirit brands and a growing interest in craft cocktails within the Millennial demographic.
The company, started in 2008, has averaged growth between 40 and 50 percent most years, he said, and has revenues in excess of $10 million.
“We’re ridiculously excited,” Silbert said. “We’ve been watching every cent.”
Live Soda, which produces a line of organic kombucha beverages offered in classic soft drink flavors, recently secured a $2 million investment from Boulder Investment Group Reprise (BIGR), a new fund led by former Boulder Brands executives Duane Primozich and Carole Buyers and Presence Marketing founder Bill Weiland.
Live Soda founder Trevor Ross told BevNET that the funds will be used to expand sales and marketing programs, including field activities, events and a new ambassador program.
Based in Austin, Texas, Live Soda launched in October, 2012 with the premise of being “a better tasting kombucha” by way of a soda-like flavor profile. Blending kombucha, a fermented tea, with extracts, spices and flavors, Live’s lineup includes varieties like cola, root beer and orange. In 2013, the company initiated a “brand optimization” pivot placing more emphasis on the kombucha aspect of its products and labeling the beverages as “Live Kombucha Soda.” The move was intended to make the brand “more relevant to a broader audience.”
Live Soda has since gained placement in variety of retail channels, including natural, conventional and mass, where the brand is represented in 1,500 Target stores across the U.S.
Monster Beverage has entered into an agreement to purchase American Fruits & Flavors, a move that will see the energy drink giant brings its longtime flavor supplier in-house. In announcing the $690 million acquisition, Monster chairman and CEO Rodney Sacks calling the official union of the companies “a tremendous step in the continuing evolution of Monster.”
“Not only have we secured the intellectual property of our flagship green energy drink and many of our other key flavors, but we are also partnering with an organization I have personally worked with and known for over 20 years,” Sacks said.
In 2015 Monster accounted for 87 percent of AFF’s revenue. The two companies have worked alongside one another since the mid ‘90s, with AFF growing at a rate of 8 percent annually over the last four years. Upon the completion of the transaction, Monster will also acquire roughly $87 million of adjusted operating income for the calendar year ending Dec. 31, 2015.
Hansberry Leaves Starbucks
Jeff Hansberry has departed as president of Starbucks’ Evolution Fresh unit and taken a new role as president and chief commercial officer at sales and marketing broker Advantage Solutions. Hansberry had led the cold-pressed juice brand since September, 2014 and was an executive with Starbucks for nearly six years, including positions as president of the company’s Channel Development & Emerging Brands division and later as president of its China Asia Pacific group.
John Culver, the group president for Starbucks Coffee China and Asia Pacific, Channel Development and Emerging Brands, “will continue to work closely” with the leadership team of Evolution Fresh “until the new leader is in place,” said Starbucks representative Sanja Gould. She noted that Starbucks “will share the name of the new Evolution Fresh leader soon.”
As president of Evolution Fresh, Hansberry oversaw the expansion of a partnership with dairy giant Dannon to introduce new juice and Greek yogurt smoothies prepared at Starbucks cafes as well as a line of packaged products called “Evolution Fresh Fruit on the Bottom Greek Yogurts, Inspired by Dannon.” Hansberry also supervised the launch of a new 11 oz. juice line designed for conventional grocery.
Advantage described the appointment of Hansberry as “the end of a robust search to identify a senior executive and thought leader to further strengthen the company’s enterprise-wide customer relationships, provide next generation strategic vision and leadership, and accelerate its evolution as a leading provider of business solutions.”
Whole Foods Departures
February saw the departure of two key grocery executives for natural products retailer Whole Foods Market.
A major change is the exit of Errol Schweizer, the company’s Executive Global Grocery Coordinator – basically the top job when it comes to determining the brands the chain carries. Schweizer joined the company in 2002 and progressed through the ranks of the company moving from a store level management position to regional and then onto global.
During his tenure at Whole Foods, Schweizer helped launch thousands of innovative natural products, and his vision for the category positioned the retailer as forward-thinking and trend setting. In particular, Schweizer is often credited for helping the retailer be at the forefront of grocery trends including HPP beverages, new superfoods (chia, hemp), non-GMO transparency, and animal welfare standards.
Also moving on from Whole Foods Market in February was Kara Rubin, Senior Regional Grocery Director for the Northeast Region. Rubin had been with the retailer for nearly 10 years and also was a Whole Foods Market Global All-Star winner.
These exits follow the October, 2015 departure of Dwight Richmond, Whole Foods Global Grocery Buyer.
Kill Cliff’s New CEO
Joe Driscoll joined Crossfit community beverage darling Kill Cliff as its new CEO in March.
Driscoll, who took the reins from Kill Cliff’s founder and longtime CEO Todd Ehrlich, who launched the brand in 2011. Ehrlich, who will remain on the Atlanta-based company’s board of directors, celebrated the news in a press release.
“We couldn’t be more excited about landing someone with Joe’s skills and track record to lead our team,” Ehrlich said. “He has built some amazing brands and is coming in at the perfect time to take Kill Cliff to the next level. To say we’re thrilled would be a huge understatement. Joe is exactly what we need at Kill Cliff.”
Driscoll joined Kill Cliff from organic snack brand Angie’s Boomchickapop, where he had been since 2013, most recently as senior vice president of marketing. Both Boomchickapop and Kill Cliff have relationships with Sherbrooke Capital, which is a current shareholder of Kill Cliff and sold Boomchickapop to TPG Capital in 2014.
New Leadership at Sunny D
After more than a decade at the helm of Sunny Delight, Billy Cyr is stepping down as the company’s president and CEO. The news came a month after Greenwich, Conn.-based private equity firm Brynwood Partners announced its acquisition of the company from fellow private equity firm J.W. Childs Associates, which purchased Sunny Delight from Procter & Gamble in 2004.
“This has been a great ride,” Cyr said. “Now it’s time for new ownership to step in and see where they can take the business next.”
Also stepping down is Sunny Delight’s chief financial officer and chief operating officer William Schumacher, who had been with the company since 2006. Both men elected to sell their shares in the company upon its liquidity event.
Succeeding Cyr is Sunny Delight’s vice president of strategy and planning, Tim Voelkerding, who’s been elevated to president of the company.
LITIGATION AND REGULATION
Pay To Play
Craft Beer Guild LLC, a Massachusetts beer wholesaler responsible for selling about 200 craft brands from around the U.S., agreed in February to pay more than $2 million for violating state laws that prohibit unfair trade practices and illegal activities.
The penalty came after more than 15 months of investigation by the Massachusetts Alcoholic Beverages Control Commission (ABCC), which handed Craft Beer Guild a 90-day license suspension for offering inducements and unfair discounts in exchange for guaranteed retail placements – a practice known in the beer industry as “pay-to-play.”
In lieu of serving the suspension, Craft Beer Guild agreed to pay a fine equal to 50 percent of its daily gross profit, multiplied by the number of days its license was scheduled to be suspended.
“The Craft Beer Guild offered a letter of compromise to the ABCC and we have accepted that letter of compromise,” an ABCC spokesperson told Brewbound.
The Boston Globe, citing a person familiar with the wholesaler’s operations, said the fine was about $2.6 million. That amount also includes sales made via its “Craft New Hampshire” operation, the ABCC and Craft Beer Guild confirmed.
“Being out of the market for 90 days would have caused upheaval, and we are committed to our customers and our brewer partners,” Tom Schreibel, the company’s vice president of government affairs told Brewbound.
But there’s more at stake than just a hefty fine: breweries that may be unhappy with the company’s performance, and looking to break an agreement, have a difficult time doing so because of strict franchise laws the govern the relationships between the two parties. By paying the fine, however, Craft Beer Guild simultaneously leaves a record of having violated portions Massachusetts’ general law.
The ABCC said it is still continuing to investigate issues of pay-to-play and additional charges could still be brought against retailers, producers and other wholesalers.
Ten days after agreeing to pay the fine, the Craft Brewers Guild filed a complaint with the state’s Suffolk County Superior Court.
Calling the ABCC’s decision to suspend its license “arbitrary and capricious, and an abuse of discretion constituting error of law and violation of due process,” Craft Beer Guild is asking the court asking to review and reverse the ruling.
Anheuser-Busch Restructures High End Division
Anheuser-Busch InBev (A-B) announced changes to a U.S. division it calls “The High End,” eliminating the “CEO of Craft” position previously held by longtime executive Andy Goeler.
Goeler, who had been focused on growing A-B’s involvement in the craft category, will transition into an expanded vice president of marketing role, working directly with both the company’s acquired craft breweries as well as brands like Stella Artois and Shock Top.
A-B has acquired eight craft brands since 2011 – Goose Island, Blue Point Brewing, Elysian Brewing, 10 Barrel Brewing, Golden Road Brewing, Four Peaks Brewing, Breckenridge Brewery and Virtue Cider – and the added complexities of advising on so many different initiatives required a more streamlined approach, Goeler said.
“I think the marketing function has become more of a need for us to focus on as we’ve grown The High End to where it is today,” he said.
So rather than having A-B’s craft outfits operate independently from other labels within The High End division, the group will now support all brands across departments such as sales, marketing and finance.
By restructuring, A-B also eliminated any confusion as to who was at the helm of The High End. As the organization’s unequivocal leader, Felipe Szpigel said he would now be the primary point of contact for all of the breweries in the portfolio.
“We’re basically connecting the founders and presidents of those breweries directly to me,” he said.