Coca-Cola
Coca-Cola Uses Crowd-Funding Platform To See If Swiss Sparkling Water Could Succeed Here
Hoping for quicker feedback, Coca-Cola is bypassing its usual product R&D process, choosing instead to test the U.S. market for Swiss sparkling water Valsar on the Indiegogo crowd-funding platform. The company is showcasing Valsar, acquired in 2001, at Atlanta-area restaurants during August to determine whether it could add the product to its American bottled water portfolio. A company exec said consumer beverage preferences are changing rapidly, so the company’s innovation team “is challenged with taking risks, testing, iterating and cycling through ideas quickly,” hence the Indiegogo experiment. If it works, innovation chief Dave Preston says, his team will consider using it on other Coca-Cola brands.
To Reduce Product Line Complexity, Coke Is Targeting “Zombies” For Liquidation
Coca-Cola has developed a guide for executives in its various markets to identify underperforming products – dubbed “zombies” – that should be axed. So far in 2018 the company has flagged 125 “underperforming SKUs for elimination” in in the Middle East and North African region alone. Sixty percent have already been dropped from the portfolio. The process of developing “zombie reviews” is a subcategory of innovation, according to CEO James Quincey, that requires ruthlessness. According to Quincey, product line complexity needs to be reduced to ensure the sales force is focused, the supply chain is efficient, and the innovation pipeline gains more space and visibility at the point of sale.
Coca-Cola To Acquire Minority Stake In BodyArmor Sports Drink Company
Coca-Cola is buying a minority stake in the sports drink start-up BodyArmor, and may soon begin distributing its products. The move is seen as another attempt to break Gatorade’s hold on the sports beverage market. Queens, N.Y.-based BodyArmor is backed by pro athletes Kobe Bryant, Mike Trout, and James Harden. Dr Pepper Snapple Group has a 12.5 percent stake as well as a distribution deal. Coca-Cola may also strike a distribution deal with BodyArmor, a move that would allow Coke to assume full ownership. Like hydration rivals Gatorade (PepsiCo) and Powerade (Coca-Cola), BodyArmor is rich in electrolytes, but uses coconut water, has less sodium and more potassium. It is marketed as a natural beverage that contains no artificial colors or high-fructose corn syrup. BodyArmor is expected to have about $400 million in revenue this year and could be valued at $2 billion.
Monster
Monster Says It’s Wasting It's Time On Mutant
Though its flagship Monster energy brand is thriving, Monster Beverage has decided that battling PepsiCo’s Mountain Dew brand is a losing cause, so it is turning its attention away from the two-year-old Mutant soft drink. CEO Rodney Sacks told securities analysts recently that the company has wasted a lot of time and effort marketing the brand and is “probably going to tail off and sort of refocus our attention” in the U.S., but will keep at it in international markets. Overall, Monster Beverage net income for the second quarter ended June 30 rose to $0.48 a share, up from $0.39 a share during the same period last year. Sales were $1.015 billion, up from $907 million the prior year. The company raised prices during the second quarter in the U.S. to offset increased aluminum and freight costs, and may raise prices overseas “in the new year.”
Nestle
Nestlé Waters Adds Functional Variants To Levissima Range In Italy
Nestlé Waters is extending its Levissima mineral water brand in the Italian market with the launch of a functional water range in three flavors and variants offering added potassium (muscle function), magnesium (tiredness and concentration), or zinc (stress). Levissima + is marketed as a hydration solution that also can “perform additional functions.” The company’s Italian unit said early feedback from the market has been "strong," with other varieties scheduled to launch in 2019.
Nestlé Now Offers S.Pellegrino Mineral Water In Cans
The S. Pellegrino mineral water brand is now available in aluminum cans whose graphics mimic the iconic look – green hue, iconic red star, silver base color – of the bottled version. The packaging also includes an image of the Art Nouveau building of the San Pellegrino Terme in Italy’s Lombardy region. Stamford, Conn.-based Nestlé Waters N.A. said the canned version will be available in 330 ml (11 oz) cans, both as single items and in eight-can packs. The company has been selling its line of sparkling fruit sodas in cans, but its mineral water has always been bottled. S.Pellegrino cans will be available nationwide starting later in August and can be obtained for home and office delivery through ReadyRefresh by Nestlé in select markets.
Other Companies
Millennials Drive Innovation In Tea
Millennials represent a large and fairly picky market for tea and tea-based beverages. According to the marketing director for PepsiCo-owned Pure Leaf, Millennials are not only knowledgeable about tea, they are driving innovation by demanding functional benefits, more tea content, quality ingredients, and “more of a fresh-brewed experience.” Market researchers say Millennials and Gen Zers are “trading up from value tea brands to premium and super-premium varieties.” The director of the Starbucks-owned Teavana brand adds that Millennials also look for “sustainability and traceability.” Beyond that, tea innovation takes the form of cold brew teas (some blended with fruit juices), new flavor profiles, new textures, functional benefits, and carbonated and nitrogen-infused varieties.
Starbucks Brand Evolution Fresh Enters Kombucha Market
Starbucks subsidiary Evolution Fresh, which produces smoothie and fruit juices, is expanding into kombucha, a category it feels will complement its juice business. The company is rolling out a six-SKU line of organic kombucha at retailers in seven major U.S. cities (Seattle, Los Angeles, San Francisco, San Diego, Chicago, Boston and New York City). The product is packaged in a 15.2 oz. glass bottle and available in six flavors: ginger lemon honeycrisp, mango pineapple, ginger greens, spicy greens, pink grapefruit and turmeric pineapple coconut. Company president Ryan Ziegelmann said that half of kombucha buyers also consume premium juice, so there was an opportunity to extend the brand platform to create a product “accessible for everyone.”
Life On Earth Acquires Relaxation Beverage Maker Just Chill
New York-based functional beverage company Life on Earth has closed the acquisition of The Chill Group, Los Angeles-based makers of natural relaxation drink line Just Chill. The deal is a common stock purchase agreement for 100 percent of The Chill Group, Inc. Eight-year-old Just Chil is a natural functional beverage formulated with the amino acid L-theanine, an amino acid, which is said to promote relaxation and sleep. The products are available in four flavors and sold in retailers such as Whole Foods (Southern California), Kroger, and H-E-B. Just Chill joins Latin drink brand Gran Nevada and Victoria’s Kitchen almond water in Life On Earth’s beverage portfolio. In April the publicly-traded company acquired The Giant Beverage Company, Inc., a Staten Island, N.Y.-based maker of shelf stable beverages.
Emerging Category Of Energy Drinks: Organic And Natural
The global energy drink market was worth about $43 billion two years ago, and could double in seven years. While traditional caffeine-laced energy drinks are still popular, health warnings about excessive caffeine intake are beginning to transform the category. More brands with organic or natural ingredients perceived as better-for-you are appearing on the market. Brands showcased as natural and organic energy drinks appeared at the 2018 Natural Products Expo West show, including Dark Dog Organic, Limitless, Guru and Zola. Researchers say natural and organic energy drinks sales will reach $32 billion – 40 percent of the market – by 2025. Key ingredients n the new ranges of energy drinks include green coffee, green tea, guarana, and ginseng, and combinations of these.
Genius Adds New Smoothie Flavors With “Functionality”
Premium coconut smoothie maker Genius will add two flavors to its portfolio later this year. The two new variants – coffee and turmeric golden milk – “capitalize on rising trends,” the company says, but also add functionality to the product line. The company relied largely on a single SKU for much of its history, and tried several rebrands and product variations over the past three years. The company re-launched its flagship coconut smoothie line in late 2017, after scaling and production problems prompted a change from coconut to “Superfood Smoothies.” That change caused some retailers to drop the brand. Genius has focused on stability, and on rebuilding its distribution footprint. It has tripled its month-over-month revenue since February, The coffee varieties will debut next month in about 500 locations nationwide. The brand is also working to lower its prices.
Inspired By Volcanoes, Volvic Launches Flavored Mineral Waters
French mineral water brand Volvic is launching a line of flavored waters made with organic tea infusions, natural fruit flavors, organic cane sugar, and organic lemon juice. The two flavor variants are hibiscus with lychee and passion fruit, inspired by a volcano on an Indian Ocean island, and white tea with rhubarb and lingonberry flavors, inspired by Iceland’s Eyjafjallajökull volcano. Available in the U.K. this month in a 4x370 ml format ($4.43) from online market Ocado, and as an individual 370 ml bottle in Budgens and Londis ($1.89), and in Tesco stores in October.
Drinkable Yogurts Gaining Market Share As Breakfast Options
Packaged Facts research finds that drinkable yogurts and smoothies are gaining popularity as breakfast options – up 20 percent over last year – while longtime favorite Greek yogurt slides. According to the report, suppliers are looking to attract younger adults to breakfast: most breakfast consumers today are baby boomers or families with children. Innovations in drinkable yogurt have included Chobani’s Apple Cucumber flavor, Dahlicious Organic’s single-serve lassi, and products from General Mills’ Yoplait and Pillars. The report predicts that the category will increase another 13 percent within the next four years.
European Companies Collaborate On Innovative Lower-Sugar Beverage Development
As an increasing number of countries enacts sugar taxes on food and beverage products, a collaboration involving a beverage manufacturer, a functional ingredients maker, and a sweetening systems specialist hopes to develop drinks that offer health benefits and reduced sugar. Sinalco, Taiyo and Sweethouse have started working on the first innovative beverage concepts, which will be presented next month at the Innovation in Non-Alcoholic Beverages Congress in London. Sinalco’s beverage portfolio includes lemonades, colas, fruit spritzers, and mineral water. Taiyo (Taiyo Kagaku) produces health-promoting ingredients for the food and beverage industry, while Sweethouse specializes in reducing sugar content and sourcing sugar substitutes. Portugal, France, Ireland, Hungary, and the U.K. have all introduced sugar taxes on foods and beverages.
ThaiBev
Thai Beverage Non-Alcoholic Beverage Sales Fell 2.7 Percent In 3rd Q
Thai Beverage PLC reported a 60.7 percent drop in earnings in the third quarter over a year ago to $248 million, largely due to weak spirits revenue and the absence of fair value gains amounting to $255 million recognized a year ago by associate F&N on an investment in Vinamilk. Non-alcoholic beverages saw a 2.7 percent fall in sales to $126 million while attributable loss widened 19.7 percent to $9.5 million. Total sales volume was 431.7 million liters, a decrease of 0.5 million liters or 0.1 percent. Shares in ThaiBev closed at 70 cents after the financial news was announced.
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