Constellation Brands Invests in Karma Wellness Water

Constellation Brands announced this week it has acquired a minority ownership stake in Karma Culture LLC, the makers of Karma Wellness Water. The deal marks the beer and spirits giant’s first investment in a non-alcoholic beverage brand through its Constellation Ventures arm. Terms of the deal were not disclosed.

Founded in 2011, Karma markets a line of waters that feature a custom push cap which holds a flavor powder containing functional ingredients including vitamins and probiotics. By keeping the additives separate until consumption, the beverage remains shelf stable for up to 18 months until purchased and mixed by the consumer. In addition to its beverage arm, Karma also operates a separate B2B operation licensing and selling the patented cap technology.

The investment, which was announced eight months after the transaction closed in July, comes as Karma releases new packaging for its vitamin and probiotic beverage lines.

Speaking with BevNET, Karma CEO CJ Rapp noted that the revamped products will be supported by a new consumer marketing campaign featuring the slogan “Believe in Karma.” The campaign, which was developed with Constellation and creative agency High Wide & Handsome, will include digital, social media, and PR efforts. Rapp noted that the campaign will seek to educate consumers on “the benefits of the cap technology.”

In addition to marketing, Rapp said the Constellation partnership will offer Karma full access to the conglomerate’s infrastructure, including the company’s strategy, marketing and sales departments. However, he said, “the responsibility for the brand still rests on Karma, we are not integrated into the Constellation system.”

“Constellation has connectivity that will be far reaching,” Rapp told BevNET. “Karma will become a better brand with greater focus on quality, innovation, marketing and sales.”

According to Rapp, Karma is available nationwide but “is not very deep,” instead choosing to focus on key retail chain partners to drive sales. The brand is available system wide in Kroger, and is available nationally in Walmart, Target, CVS, Wegmans, Harris Teeter and Rite Aid, as well as online with Amazon. The Constellation partnership, he said, will give Karma access to the company’s DSD network to expand its retail footprint and the brand will continue to focus on mainstream retail outlets in the convenience, grocery, drug and mass channels. The brand will also add food service accounts through a partnership with Compass where it is in the “early stages” of a national rollout.

In addition to the beverage line, Constellation will also work with Karma to grow its B2B push cap business. Karma partnered with manufacturer Aptar to produce the caps and Rapp said the company sees strong “medical field potential,” seeking to partner with pharmaceutical companies. As well, Karma also supplies its caps to other beverage brands, including hangover recovery drink Last Call.