Gnubees believes its better-for-you, juice-adjacent kids drinks have a path towards capturing a significant piece of the category, and it is eyeing the convenience channel as its route to get there.
The Canadian beverage brand recently locked in a distribution through Coremark’s emerging brand accelerator and incubation program, Coremark Curated – bringing its door count from 500 to approximately 5,000 doors over the next year.
“Having Cormark as our distribution opportunity really opens up this channel a lot faster than we were expecting but we’re absolutely ready for it and excited,” said Autumn Kendrick, chief strategy and ideation officer. “We believe it’s going to be a great channel for us to grow in [in addition to] other opportunities that we still have to keep under wraps but there’s some really exciting growth happening.”
The brand has been making gains throughout the year, broadening in U.S. grocery through a partnership with H-E-B, launching on HungryRoot and completing two activations at Pop Up Grocer (PUG) in NYC. But this new agreement will mark Gnubee’s largest expansion to-date, bringing the brand to a diverse shopper demographic and build validation for its position as an easy, on-the-go alternative to the high-sugar beverages typically found in the channel.
Gnubees originally launched in Canada in 2017 with its flagship Gnubees Kids and extended the platform with Gnubees Plus, intended for consumers “9 to 99”, in 2022. Coremark will start with Gnubees Kids – made with a blend of milk, fruit juice, honey and whey protein – and “expand from there,” Kendrick said. The Plus variety is made with the same core ingredients, but swaps milk for coconut cream and includes prebiotic fiber.
The Kids line comes in three flavors – Rockin’ Raspberry, Go Bananas and Mango Tango – while Plus is available in four flavors: Grape Aspiration, Lemon Limelight, Tropical Unstoppable and Strawberry Wise. Gnubees Plus comes in a slightly larger pouch, 8 oz. versus 6.5 oz., and contains 8 grams of protein, 4 grams of fiber and 30% daily dose of vitamins C and D. The kids will be on-shelf for $2.99 in c-stores while the plus line costs $2.89 in retail.
Initially, the shelf-stable resealable pouches will be sold individually and merchandised on the dry shelf or shelf racks. According to Brandi Heindl, who works on Gnubee’s sales strategy in her role as National Sales Director at Burgess Strategic Advisors (BSA), the company is working on a possible multi-pack format and is also hoping to secure placement in refrigerated grab-and-go sets.
Heindl believes placement in a cold case will be most effective to draw in new customers, particularly in the convenience channel, but is wary of being slotted near yogurt offerings.
“We don’t want to confuse the consumer by being in the space [near yogurts],” said Heindl. “But that [section] is where our ultimate goal is to be. We know from [our business in] Canada that it is a proven fact, if [the product] is refrigerated or even slightly chilled, consumers enjoy it more.”
Heindl believes that in addition to consumer base changes within the convenience channel – which she said has shifted from working class individuals to people from all walks of life – the rise of electric vehicles could also be a bonus for the brand. She said EV drivers will be spending longer amounts of time at rest stops (an average of 30 mins per charge) than those who drive gas-fueled cars; Heindl believes in addition to having more time to shop around, EV drivers are more likely to be interested in better-for-you, sustainably positioned products.
At the National Convenience Store Association (NACS) trade show earlier this month, Heindl said those assumptions were echoed by numerous buyers on the show floor.
“Category managers [were saying] ‘this is amazing’ and were so excited to see somebody else competing in the juice category,” said Heindl. “They recognized it as a grab-and-go juice and were excited to see somebody come into the convenience channel, bringing innovation that they may have not been searching for, but now that they see it, they know it is something probably missing in the category.”
An Emerging Brand Backed By A Big Business
Gnubees is just one of the brands created by its parent company Gnusante Creations, the CPG division of food and beverage co-manufacturer and consultancy firm Catalyst Development. Gnusante also produces sparkling collagen beverage RAD8 and pouched birch sap hydration brand 52 North.
Catalyst was founded over two decades ago by Kendrick’s father, Ron Kendrick; he went on to found GnuSante alongside his other daughter, Sarah Kendrick Wall. Ron Kendrick is well-versed in the CPG beverage industry; he was the mastermind behind the formulations for sparkling flavored water brand Clearly Canadian and Orbitz as well as brands like Essentia, Good Drink and Rvitta.
That means that although Gnubees is an emerging brand, it is backed by a vertically integrated beverage business as well as a plethora of industry experts. This structure has allowed Gnubees greater flexibility to iterate, evolve and quickly respond to market feedback, said Kendrick. Catalyst offers formulation consulting, dry ingredient blending, co-manufacturing capabilities and operates a pouch production line.
“We’ve been lucky to invest in ourselves and these opportunities without the stress that a lot of young brands might [face or] not be able to do,” said Kendrick. “We are in a really lucky place to promote an exciting product that we do feel is true to our core of being ethical and putting people and the planet first but also providing an answer to the busy mom and families.”
One key focus of that self-investment has been in data. Kendrick said Gnubees recently contracted consumer-driven product review platform Social Nature to gather consumer feedback, noting it has been an important tool as Gnubees builds its brand story across different classes of trade.
“We’ve been able to gather data and look at what do [consumers] love? What do they want? How often are they looking at purchasing this? Are they recommending it? As well as [ask] follow up questions,” explained Kendrick.
While Gnubees remains wholly-owned by Catalyst and the company is “debt-free with no investors,” Kendrick believes that the brand may begin looking to bring in external capital next year to continue to support its rapid growth.
Where Will Gnubees Roam To Next?
Whereas the brand’s retail footprint is tilted to natural grocery in Canada, in the U.S. Gnubees is pursuing both natural and conventional stores and will likely focus on expanding regionally in Texas as well as in the Midwest and West Coast.
Kendrick said the brand’s activations with Pop Up Grocer provided valuable insights around Gnubees reception in the Northeast and noted it gained limited distribution in some New York bodegas from its presence in the store
“Very important people are going into that [NYC] store – and people have an eye on what brands are going in there,” said Kendrick. “It’s not a high volume turnaround, ‘let’s go make money and get our money back on this investment’ but it is something that opens doors, allows you to get a sense of the market and get some trial and feedback which is so key.”
As it continues building out its footprint and establishing the product’s position, Kendrick said she hopes to team up with young athletes to promote the product, noting that certain Gnubees Plus flavors have a strong fan base among Gen Z and Millennial consumers. Kendrick also noted that while the product has been around since 2017, she believes it is now “finally in its time.”
“The kids beverage segment is a very difficult place to play,” said Neil Kimberley, an advisor to Gnubees, independent consultant and former chief strategy officer at Essentia. “It tends to be filled with high sugar beverages with little nutritional value. Gnubees is ahead of this market – from its nutritional benefit to taste, mouthfeel and packaging. We are now seeing some great store-level performance and continue to get kudos from parents and kids who really love the product.”