Forto Partners With The Hershey Company For New SKU, JAB Invests

Ahead of the National Association of Convenience Stores (NACS) 2017 show in Chicago this week, Forto today announced the launch of two new reduced caffeine SKUs to its line of organic cold brew coffee shots: Pure Black Espresso and Hershey’s Chocolate, a co-branded release developed in partnership with The Hershey Company.

The new flavors, which contain 100mg of caffeine in each 2 oz. serving, will be showcased for the first time on the NACS show floor ahead of a planned roll out on November 1.

Speaking with BevNET, Forto founder and CEO Neel Premkumar explained that the brand had been developing a chocolate SKU since the end of 2016, with the idea of creating a flavor that already had a strong presence in the front of the store. But the new innovation was partially inspired by listening to feedback from consumers asking for less caffeine than the existing Forto line, which has 200 mg, or about two cups of coffee, per 2 oz. serving.

“This was kind of a way for us to signal that we are trying to broaden the market and launch a lower strength, less caffeinated version to bring more people into the category,” he said. “In the beginning, we didn’t quite see how big of an opportunity that was, so that’s why we launched this line.”

Though the confectionary company has an extensive creamer and coffee flavoring business, Hershey’s partnership with Forto marks its second entry into the ready-to-drink coffee market, having previously released a co-branded iced coffee product with Whitewave-owned International Delight. Like all Forto shots, the Hershey’s Chocolate SKU, which contains milk, is USDA Certified Organic and made using Fair Trade Certified coffee.

“We worked really hard to make it taste like a Hershey’s chocolate — we agonized with them on exactly how to do that,” said Premkumar, who cold-called his way through the company before connecting with its licensing department and pitching the idea of a co-branded SKU.

Aside from emphasizing quality ingredients and responsible sourcing, Premkumar added that organic certification creates another point of distinction between Forto and the dominant energy shot product, 5-hour Energy. “It’s also just a way to communicate to consumers that this is safer,” he said. “5-hour Energy is a great product, but the understanding of what is in it from consumers is really low. As a result, when people don’t understand something, they get scared of it.”

Forto’s other new SKU, Pure Black Espresso, provides consumers with a reduced caffeine variety that’s also non-dairy and sugar free.

“We looked at data of what people consume out of the home for coffee,” said Premkumar. “At C-stores, what they are doing in the brewed coffee section, one-third is black coffee. So we wanted to have a black option for folks.”

Forto’s expansion comes as its parent company Dyla Brands, which also markets Stur, a line of flavored water enhancers, is growing as well. Premkumar confirmed that the company had recently received a small venture investment from JAB Holding Company, whose interests in coffee include controlling stakes in Peet’s Coffee & Tea, Caribou Coffee Company, Intelligentsia Coffee & Tea and Stumptown Coffee. He noted that, though Dyla was not actively seeking to raise money and has only taken limited angel investment thus far, he recognized an opportunity to take advantage of Foto’s current high velocities at retail to go after a larger share of the market immediately.

“It was a function of finding the right partner who was going to allow us to do what we wanted,” he said, noting that the idea was “to continue to do what we are doing, but to put a little more fuel in it.” He continued: “I think these guys in particular are big coffee players and are very experienced in the coffee side of the business, and so — especially as we were planning on launching the single-shot, 100mg caffeine line — the coffee creds need to be boosted. Improving the taste of the product really needs to get there.”

Besides fueling innovation, resources are already being directed towards creating a more robust sales and marketing presence for the Forto brand. Brian Coleman, formerly of Vita Coco, has been hired as a director of field marketing, and the company is looking to bring in an area sales manager for New York City, where it launched direct store distribution (DSD) through Dora’s Naturals just this month. Forto is currently sold in over 20,000 locations nationwide.

“To date, we’ve only done a little marketing,” said Premkumar. “I think Brian is going to put in practice an actual field program. At this point we are in every state in the country, so I think we want to figure out how to efficiently get out, meet with our consumers at the point of energy and kind of build a program.”