Convenience stores may still be king when it comes to energy drinks, but ZOA is targeting opportunities in the digital market this fall.
The zero-sugar, fitness-oriented energy drink has a nationwide distribution pact with Molson Coors, but with this month’s release of its latest limited edition offering – Cherry Limeade, available for $24.99 per 12-pack exclusively from its website and on Amazon – the brand is looking to tap further into its consumer base and lay the groundwork for more promotional activity and releases later this year.
Speaking with BevNET, ZOA CEO Mike Pengue said that the LTO flavor came together relatively quickly in recent months following the release of pre-workout line ZOA+ in March, also as an online exclusive. With co-founder Dwayne Johnson bringing his own massive online fanbase directly to the brand, having a robust digital business leans into ZOA’s strengths, he said. It’s also a way to trial new flavors and grow its number of overall SKUs, an area where the brand trails rivals like Bang, Monster and Celsius.
“This is a way for us to be able to put something in the marketplace really quickly, get consumer reaction, sell through the cases, and then make a decision from there, whether we’re going to launch it in the general market,” Pengue said.
The flavor drop kick starts a busy end of 2022 for ZOA, starting with the October 21 release of Johnson’s next blockbuster, Black Adam, marking the first time Warner Bros. has partnered with an energy drink, according to Pengue. Later this fall, the company will move to its first international market when it launches in Canada.
Like its larger competitors, ZOA has been forced to deal with a range of unique supply chain challenges over the past year. Pengue, who joined the company in 2021, cited the hiring of senior VP of supply chain Brian Boermeester, formerly of Nestlé Waters, last year as key to ZOA’s ability to ride out the storm, along with its “great partnerships” with suppliers Ball and ADM Flavor Systems. Unlike Red Bull and Monster, Pengue said ZOA can afford to avoid price hikes for the moment, and that “cost of goods are dropping as planned.”
“We’ve been able to stave off the inflation hit, but it doesn’t mean that it’s going to be there forever,” he said. “For us right now, our growth is feeding a level of efficiency that is keeping our costs level so we are not in a position where we have to take price.”
Dollar sales (+641%) and volume (+42.6%) have soared for ZOA over the 52-week period ended on August 13, according to data from NielsenIQ. The brand has grown dollar share by 20 base points during that time, trailing Ghost (46), Nutrabolt (81) and Celsius (184).