Huel Launches Ready-to-Drink Line

Nearly a year-and-a-half after launching in the U.S., British meal replacement powder brand Huel is releasing a line of ready-to-drink “nutritionally complete” beverages. The new products generated massive single day sales when they became available for pre-order online this week, according to the company.

Speaking with BevNET, CEO James McMaster said the launch of the RTD line puts the company on trajectory in 2019 to double or triple the company’s $10 million-plus in U.S. sales since 2017. McMaster said he hopes the new products will appeal to both longtime customers and new consumers who want to avoid the preparation and cleanup of powdered products.

“There’s obviously a trend in a lot of people becoming busier and their lives being more hectic,” McMaster told BevNET. “[An RTD has] been on our mind for awhile and we’ve had customers asking for it for a long time. It’s a very complicated product to make, so we’ve been spending a lot of time on it.”

The RTD line is available in Berry and Vanilla flavors and contains 400 calories per 16.9 oz. bottle. The products are currently available exclusively in 12-packs through ecommerce for $54, or about $4.50 per bottle, with savings offered for bulk purchases or subscriptions.

The launch will be accompanied by a marketing campaign that will include a social media, where the brand has about 250,000 followers across platforms. The company is also running TV ads in the U.K. and will evaluate expanding that strategy in the new year.

While Huel has no immediate plans to launch its RTD line in retail, McMaster said the company has received requests to bring the product to college campuses and that some retailers have also reached out to the brand. But the company wants to establish its production for the line before adding retail distribution.

According to McMaster, the U.S. is part of a global strategy that has included launches in 80 countries, including China and Germany, where it has opened an operational office. Huel is now building a U.S. team and a production facility. The company has about 80 staff members working in five offices worldwide. The expansion has been funded by a $26 million investment the company received from venture capital firm Highland Europe earlier this year, he said.

“When you’re a small, fast-growing business cash is always super complicated, so that issue has disappeared for us,” he said. “Some of the R&D costs have been huge, I think we spend a disproportionate amount on R&D than most mature companies…. Investing in new product development has become a lot easier now that we have more funding behind us, and our RTD has been quite expensive to develop.”

While U.S. is currently a small part of Huel’s overall business, McMaster said the company had been more focused on the U.K. market and was caught off guard by the American demand. He also hopes the RTD launch, as well as new powdered flavors set to launch in the coming months, will allow Huel to even out sales between the two countries.

“We’ve been working very hard in the background on catching up with the U.S. demand,” he said. “It did catch us by surprise, but we were ahead of forecast in the U.S. and customers were asking us why the U.K. always gets products first. But we’re working hard to change that and all the hard work is paying off. I think we’ll have a lot more momentum going into 2019 with a different headspace, where the U.S. is no longer in its early launch phase but a more established part of our business.”