Brands See Flavor, Marketing Opportunities in Hybrid Drinks

Call it an Arnold Palmer moment.

Chris Hopkins, a former category manager at Dr Pepper Snapple Group, is on his sailboat in the Caribbean, catching a gentle sea breeze and sustaining himself with plenty of cold brew coffee and kombucha. In a moment of inspiration, he decides to splash coffee into his kombucha and give it a swirl.

His reaction on the boat that day would set a new course for his career, and potentially for the beverage market overall. “Wow,” said Hopkins, founder of Blue Island Coffee, remembering the moment in a call with BevNET last week. “I said, ‘I think I’m onto something here.’”

Like Palmer, whose signature drink of iced tea and lemonade was discovered when a woman sitting nearby overhead the golf legend order it at the Cherry Hills Country Club in Denver in 1960, Hopkins is the latest in a long line of hybrid drink pioneers. Yet as simple an idea as combining two existing beverages into one product might be, several brands such as Blue Island are using the concept as a platform for exploring category-crossing innovations with a distinct appeal to millennial consumers.

Few such new hybrid beverage products are more on-trend than Blue Island’s line of cold brew coffee and kombucha blends, launched in March. Hopkins said that he spent several months tweaking the blend of kombucha and cold brew to find the right balance between each of their distinctive flavor profiles.

Yet beyond taste, Hopkins explained that he saw a significant opportunity to explore the space between two independently strong categories that were particularly popular with the all-important millennial consumer demographic. According to research from Mintel, 76 percent of hybrid drink consumers say they like to try new drink types and 63 percent agree that hybrid drink products encourage them to try new drinks that they would not normally try. 72 percent of Millennials, defined as between the ages of 22 and 39 in 2016, are likely to agree with that statement, more than any other age group.

“The idea was focused on millennials, and that made sense because it was already hot with them,” said Hopkins, adding that Blue Island’s cold brew coffee and kombucha drinks were geared specifically towards millennial women. “Going to a retailer, you want to be able to expand the pie and bring new consumers into it. Millennials are fickle and they are always looking for something new, so that was my whole key thing — it’s something new, innovative, different.”

Pressery has taken an alternative approach to marketing its hybrid beverage offerings, which include drinking vinegar and bone broth products that are combined with cold-pressed fruit juices. While noting the importance of millennials’ desire for disruptive products, founder and CEO Ian Lee said that the company is looking to communicate with a broader audience.

“Products fail when they try to get too tight on their demographic,” he said. “I think it’s about understanding consumers and figuring out how to communicate in a way that makes sense.”

Pressery has made hybridization a cornerstone of its brand identity since launching in 2013. Lee said that by committing resources to R&D and not manufacturing to cost, it’s able to take an open-minded approach towards product development and listen to what types of combinations consumers are demanding.

“We want to take that feedback and synthesize it so we can start to understand common themes that we’re seeing and what are people interested in,” said Lee. “The other piece is looking more broadly at the market — what are the packages and products that don’t exist today that we need to spend time creating?”

Along with presenting new flavor combinations, the individual beverages within some hybrid drinks can help offset certain qualities in each other. The coconut vinegar, for example, in Pressery’s drinking vinegars helps lower the sugar content when combined with cold-pressed fruit juice, while the inclusion of maple syrup helps to maintain sweetness.

Elsewhere, Bonafide Provisions’ recently debuted Drinkable Veggies line, an organic high pressure processed blend of individually roasted or steamed and pureed whole vegetables and bone broth, is specifically formulated as a nutrient-dense drink that can appeal to mainstream consumers. In an e-mail to BevNET, Bonafide founder and CEO Sharon Brown said that the line is positioned as an answer to vegetable juices currently on the market that are blended with sweeteners like fruit juice and stevia.

“The bone broth is what smooths the sting of the vegetables and makes them palatable and amazingly delicious,” she said.

While it can also be used as a drinkable meal replacement, Brown said that unlike soups, in which all ingredients are cooked together, preparing the vegetables individually allows for the taste of each to stand out on its own. The bone broth acts as a smoothing agent to help create texture, while keeping the taste of the produce intact.

According to Anne Williams, vice president of marketing and category for Evolution Fresh, the idea behind the high pressure processed juice company’s new three-SKU hybrid beverage line called Coolers — a combination of cold-pressed juice and cold brew tea — is much simpler: consumer demand for refreshing options with no added sugar.

The line, which debuted in March, is available in three varieties: Blueberry Mint, Raspberry Citrus and Tropical Hibiscus. Williams said that finding the sweet spot between the two liquids was key, as Evolution Fresh sought to balance the bright, naturally sweet fruits, such as watermelon and pineapple, with the smooth and mild flavor of the cold brewed tea.

“We looked at what the need states are and how can we deliver that in a way that’s unique to us,” she said, noting that refreshment and healthy snacking were two key attributes identified in the company’s research. To address the latter, the brand unveiled a line of superfood-packed smoothies made with a blend of coconut milk and cold-pressed juice called Organic Superfoods earlier this year.

In contrast, Lee said that while Pressery pays attention to broad consumer trends, such as demands for less added sugar and great nutrient value, those are more prominent in influencing product line extensions than in creating brand new hybrid beverages.

“We look at sugar, but we don’t manufacture a product in order to hit a certain amount,” he explained.

Throughout all the extensive planning, development and marketing involved in launching hybrid beverage products by these pioneering brands, it can be easy to forget the simplicity of the idea itself. As long as curious drinkers keep on toying with beverage combinations, the runway for innovation is endless.

“You have to be willing to fail, and that means a lot of internal failures and some market failures,” said Lee. “But we want to keep pushing the boundaries, and we believe that ultimately our core consumer base trust us and will continue to follow us along, even when a product hits the market that we thought was really good but doesn’t resonate. That’s fine — we’ll pull that off and continue to evolve.”