Upstart soda brand No Cap has signed an exclusive licensing agreement with family-owned candy maker Albanese Confectionary Group to bring that company’s popular gummy flavors to its lineup of zero-sugar modern sodas.
The SoCal-based No Cap, launched last year by former Bang and Congo Brands sales executive Sam Wilson and his son Vinny, is seeking to replicate the playbook that has performed well for energy brands like C4 and Ghost by aligning a hot category with a highly recognized candy property. The three-year licensing agreement grants No Cap exclusive rights for use of Albanese’s gummy flavors in better-for-you soda, with the first two limited-time offerings to arrive in July.
“We recognized early that flavor is king, but brand familiarity is what creates the trust,” said Vinny Wilson. “That’s where you almost get a jump ball at the shelf — it could be just another new brand to a consumer, or it’s another new brand featuring some sort of licensing partnership that the consumer already has trust in.”
The deal further separates No Cap! from an ever-growing field of competitors in the “modern soda” category, captained by brands like PepsiCo’s Poppi, Olipop and Culture Pop. Although it entered the market as a prebiotic soda, the brand has since dropped fiber (while keeping callouts to immunity benefits and postbiotics), moved from a 12 oz. to a 16 oz. can, and expanded distribution for its five SKUs as it goes after consumers aged “three to 30,” explained Sam Wilson.
That demographic, in recent years, has helped drive the popularity of licensed partnerships between beverage makers and confectionary mega-brands like Hershey’s, Ferraro, Unilever and Mars. Energy drinks C4 and Ghost have made candy IP a calling card for their respective innovation strategies, while Sparkling Ice, Fire Brands and Victor Allen’s have also played in the branded candy space.
Independent CPG consultant Joshua Schall notes that the importance of licensed flavors to the success of C4 and Ghost may have been overstated, as both those brands were incubated within the supplement category and “destined to compete against any large CPG categorical incumbent.” Yet while large retailers with fixed merchandising sets may be more closely scrutinizing the value of licensed flavors as they become more common, “I don’t think we are anywhere near a dense saturation level when you look across the functional product landscape,” he added.
The strategy has yet to be tested, however, within the next-gen modern soda set.
“Ultimately, if it’s not broken, why fix it?” said Sam Wilson. “There’s no question if you look at the SKU rankings within the energy space — or even water with Sparkling Ice — the licenses tend to be at the top of that list. So we’re expecting something very similar, but we’re not trying to reinvent the wheel. We’re just bringing it to a new category.”
With the ambitious timetable of launching a product this summer, Vinny Wilson initially “flooded” the marketing departments of major candy companies with inquiries, before eventually connecting with Ari Freedman, vice-president of licensing agency Surge Brands. Within weeks, No Cap was in talks with Indiana-based Albanese Confectionary Group, most known for its “world’s best” gummy candies. The company generated over $147 million in sales of non-chocolate chewy candy in the 52 weeks ended June 16, 2024.
The two parties’ shared focus on cultivating younger consumers helped speed up the deal, which will start with a pair of LTOs this summer that will rotate out after four months; the 16 oz. cans turn for $2.49 each normally, but will run at promo at 2-for-$4. The alignment has opened at least one new retail opportunity outside of grocery already: No Cap’s licensed flavors will be available alongside Albanese candies at specialty discount chain Five Below.
The new line won’t significantly change No Cap’s plans to grow in DSD, a path Sam Wilson knows well from his experiences developing brands like Prime and Bang. The Albanese licensed flavors will hit five Kroger divisions, as well as Albertsons, Vons and Pavilions. No Cap just passed over 500 unique active doors, mainly in its backyard in SoCal and the Southwest.
The brand is also receiveinga boost from distributors that are assessing No Cap as an option to replace Poppi in their portfolios after its acquisition by PepsiCo. No Cap’s latest partner, Hayden Beverage Company, just signed on to distribute the brand in Idaho and Montana. Its other DSD partners include Classic Beverage, Hensley Beverage, Alabev, A&B Distributors and Donaghy Sales.
“When we were starting this thing, we didn’t anticipate the network to almost simultaneously lose Ghost, Alani Nu and Poppi, and then that has expedited the number of agreements we get,” said Vinny Wilson. “We like to work fast, and we were aspirational about the licensing deal getting done by summer, but the minute we sign that contract, that just levels us up again.”
But the Wilsons see No Cap’s partnership with Albanese as the start of something, rather than an end itself. Both reference the deal as providing “validation” for its strategy from across the business ecosystem.
“For us to have the trust of a national brand like Albanese so early on, it validates that we’re not going anywhere,” said Sam Wilson.