Boylan Bottling has been quietly showing a lot more love to its sleeper Mash sparkling juice brand.  NY-based brand owned by Emigrant Capital has revamped branding, added pair of flavors to current 4-flavor lineup and coo Chris Taylor says the brand – which many years into its existence didn’t even boast a website – is within a couple of thousand cases of overtaking the glass-bottle sodas in core NY market. 

The brand, recall, mashes up pair of flavors in lightly carbonated refresher containing modicum of juice (1-5%) and comes in at 100 calories per 20-oz bottle, a figure that’s now prominently heralded in marketing.  (Brand used to characterize calories as 45 per 8-oz serving.)  For years, with little in way of marketing support, brand managed to carve out position as meal accompaniment in broad range of retail venues, from upscale sandwich shops to Vietnamese banh mi joints, bodegas and neighborhood pizza shops, at time owner Emigrant ceo Michael Milstein was focused on turning around Boylan soda brand.  With Boylan brand back on track, tho, team has turned to better exploiting Mash brand, packed in striking stubby 20-oz plastic bottle and offering bit more palate impact than La Croix as a refresher. 

Speaking to us at Big Geyser internal expo held at Manhattan event space on Thurs, Chris sampled new Watermelon Lemon Lime and Coconut Pineapple flavors that augment existing lineup of Ripe Mango Blood Orange (the best seller), Grapefruit Citrus Zing, Lemon Peel Ginger Root and Pomegranate Blueberry. 

Outside city, Mash added Haralambos Beverage in LA to DSD mix (it already carried Boylan sodas) and this week big Bud house Hensley in Ariz is slated to pick up both brands, Taylor said.  A test at Food Lion’s 1,200 groceries blew thru 9K cases of Mash in just 2 weeks, even without the 2 new flavors, signaling potential of brand even outside major metros, Taylor believes. 

Industrious crew at Boylan Bottling has been working eponymous Boylan soda brand while pondering other verticals it might enter, managing return of Jolt Cola within Dollar General chain and picking up responsibility for Detour Bar, another Emigrant holding.  And Emigrant participated in seed round last year of local cold-brew coffee play Rise Brewing, which it’s assisting informally in climbing learning curve.  So tho Emigrant has backed off once grander ambitions to be significant private equity player, it’s certainly staying connected to action bubbling up in fertile NY bev scene.

Monster Beverage on Fri evening vigorously refuted lawsuit filed by rival VPX Sports that contends Monster’s new Reign performance energy brand is infringing on a trademark it already owns, issuing scathing rebuttal that most of facts cited in VPX suit are completely made up.  The rejection came at a time that some analysts have been tempering their enthusiasm for Corona, Calif-based co on variety of grounds – in case of Macquarie’s Caroline Levy, in report issued just yesterday, concerns that it may not be connecting as well as it used to with entry-age consumers.

In its statement, MNST termed Bang marketer VPX’ suit “nothing more than a frivolous and bad faith attempt to slow the national release of Reign Total Body Fuel” that “will not impede the launch” in any way.  It argues that MNST holds the trademark for relevant class of trade – beverages – and that VPX only moved to acquire it for that class after Monster announced launch, for “clearly an ulterior motive.”  As for VPX’ claims that it already has been marketing a pre-workout supplement called Reign, Monster said no such line existed until now.  (A 24-page “beverage catalog” dated 2017 in BBI’s possession  includes no mention of a Reign brand, limiting itself to Bang, Redline, Protein Rush, Pristine Protein and Meltdown brands.)

Macquarie’s Levy cited several factors in changing rating on MNST stock from outperform to neutral.  By now, Bang accounts for all of energy category’s incremental growth and its lawsuit, even if it proves frivolous, “could be enough to cause wholesalers and retailers to hesitate about getting fully behind the launch.”  Beyond that, while Monster is still regarded as very well-run co, Caroline writes, “it has lost its edge with the younger generation,” which has been turning to other energy brands and to coffee to get a lift.  “While Bang is its largest threat, new brands like C4 and Uptime are also gaining traction,” she writes based on contacts in trade.

Meanwhile, influential TV stock jock Jim Cramer is advising investors to stay away from MNST shares, not on any fundamental grounds but simply because he thinks there’s no point trying to sort out tussle between stock’s bulls and bears at time there’s money to be made on flock of ipo’s hitting market.  “I cannot stress this enough: we're at the start of an IPO season that looks on track to bring a trillion dollars’ worth of companies public,” he advised viewers of CNBC’s Mad Money.  “When you get a situation like Monster where a stock keeps getting mauled by the bears, but a couple of heroic analysts remain bullish, that's not a fight you want to be involved in.  Believe me, there are lots of easier ways to make money.”

Recall that Monster had earlier sued VPX over what it contends are bogus claims of drink’s benefits and of patent on creatine that’s been disallowed by US Patent & Trademark Office.  In that case, Monster noted in its Fri evening statement, “VPX’s attempt to continually delay” the suit “was rejected today.  In addressing VPX’s latest desperate, delay tactics, the district court judge ruled against VPX and observed that VPX ‘walked into a mess of their own making.’”  VPX has also been sued by owner of creatine patent, Thermolife, and also is target of several class action suits. 

  Whole Foods is venturing into convenience via concept called Whole Foods Market Daily Shop.  It opened 4 weeks ago at corner of 7^th Ave and 25^th  St in Manhattan, as first in country, a barista told us, on day that big snowfall trimmed turnout and made traffic a slow build since then.  While full store next door – the city’s first – is notorious for lines snaking thru oddly configured space, barista said it’s rare for anyone to wait 2 minutes to check out of new unit, which contains self-checkout space too.  Each section, from produce to bevs, has selection dictated by what are best-sellers in full section of store next door.  In bevs that means ample kombucha selection, including 2 shelves of GT’s and one apiece for Health-Ade and Urban Farm Fermentory, along with brands like Fit-Aid, La Croix, Waterloo, Matchabar, Hiball Energy, OWYN and full case of bottled waters dominated by retailer’s private-label 365 offerings.  Allegro coffee bar along one wall was offering pair of draft kombuchas from local player Pilot (we ordered a Lavender peach) along with usual array of coffee options, including cold-brews.  As Eater noted, shop places premium on local products like Gotham Greens juices, Balthazar breads and Dunwell & Dough doughnuts.  It also touts acai bowls.  But it carries complement of everyday items from pet food to produce and travel-size toothpaste.  Amazon Prime is going to open similar concept under its own brand, barista told us, tho details are still to be disclosed.  (Pic below left.)

WeWork Now a Retailer, via Made by We Store on Broadway   There’s retailing, e-tailing and now something we maybe can call We-tailing.  WeWork operator We Company has opened retail and coworking concept in NY’s bustling Flatiron district that features café operated by Bluestone Lane coffee chain and sells items made by cos based within its vast network of coworking spaces.  Created by co’s in-house design team, retail space features items chosen via series of pitch nights that saw WeWork inhabitants like Miks Letterpress (stationery), Memobottle (reusable bottles), Lebby (chickpea snacks) and Minna (sparkling tea) make the cut.  “For aspiring startups,” Curbed wrote, “Made by We could be the beginning of a WeWork ecosystem: network with potential collaborators, design and develop products in a coworking space, then sell to fellow coworkers at We Company retail spaces.”  Behind the public area is WeWork space that offers nearly 100 bookable seats and 6 meeting rooms that are available even to non-members.  “In addition to blurring the lines between workspace and retail, the Made by We space will also host programs focused on ‘people who are shaping culture and influencing the modern workplace,’” Curbed reported, starting with late Jan discussion on redefining beauty and health.  We snapped a pic just after it closed last night, below right.

Lidl Opens C-Store on Ground Floor of US HQ in DC    German discounter Lidl, which has been making concerted push into US, has opened 1K-sq-ft c-store dubbed Lidl Express on ground floor of its Arlington, Va, hq, Washington Biz Jnl reported.  New unit, which contrasts with 20K-ft footprint of typical Lidl grocery, is open to the public tho its primary purpose is to bring products closer to staff, a Lidl rep told paper.  It offers coffee, fresh baked goods and some prepared foods, as well as beer, wine and fresh produce.  Paper said there are no current plans for additional units, tho rep didn’t entirely rule out idea.

Shakeup at Campbell Soup is continuing as chmn Les Vinney, 70, said decided to retire after 16 years, succeeded by board member Keith McLoughlin, not long off stint as interim ceo that ended when Mark Clouse was recruited to job in Jan. Vinney cited personal commitments. Another board member, Sara Mathew, has also chosen to retire, while activist investors at Third Point will move in May to fill 3d board seat they control with former Hershey ceo JP Bilbrey . . . Christine Perich is continuing itinerant career since departing New Belgium Brewing as ceo, now signing on as chief financial and strategy officer at Craft Brew Alliance starting Apr 1. After serving 16 years at Fat Tire brewer New Belgium, where she rose to prexy/ceo, she’s had considerably more varied runs with involvement with brands like Health-Ade Kombucha, WTRMLN WTR, Lews Whiskey House and Owl’s Brew, in which Anheuser-Busch holds key stake via Zx venturing arm. That’s given her interesting mix of experiences with which to steward CBA’s pH Experiment arm that aims to launch new products that move beyond conventional beer space. “Lifting my head outside beer . . . I have a different perspective now too,” she told BBI sibling newsletter Insights Express, that should help to “meld nicely into this role.” That echoes path of other execs like Dave Burwick, who’s been using experience gleaned on non-alc side at cos like PepsiCo and Peet’s Coffee to foster innovations like hard kombucha at his latest assignment as ceo of Boston Beer, brewer of Sam Adams. Recall, Anheuser-Busch InBev has 31% stake in CBA, and includes brands like Kona, Omission and Redhook.

Judge ruled yesterday that suit can go forward that claims Nestle Waters defrauded its consumers by filling its bottles of Poland Spring with ordinary groundwater, Reuters reported. US District Court Judge Jeffrey Alker Meyer rejected Nestle’s effort to dismiss suit brought by consumers in 8 Northeast states stretching from Maine south to Penn and NY (not including Vermont, preempted from federal law from filing). As Reuters reported, amended complaint claims Nestle Waters sells 1 bil gallons of Poland Spring a year in US, “not one drop” of which “emanates from a water source that qualifies as a genuine legal 'natural spring.'” NWNA terms the suit meritless.

Nutrabolt’s C4 brand, another key player in burgeoning performance energy space dominated so far by VPX Sports’ Bang, has accomplished rare feat of signing essentially entire Anheuser-Busch distribution network in Florida, which in recent years has generally been DSD desert for unaligned brands seeking indie options. Sales chief John Herman told BBI today that brand had recruited 18 of 19 Bud houses in Sunshine State, with sole exception being Panhandle-area house, Lewis Bear, that already carries Bang. Over years, with alternatives scarce, many have tried to recruit entire Bud system in state but ended up with numerous holdouts.

Bang Energy marketer VPX Sports, battling a Monster Beverage suit over its allegedly unfounded claims, is firing back with lawsuit of its own contending that Monster’s newly launched Reign performance energy brand mimics its candy-colored graphics and employs brand name that VPX itself actually owns.  And, as suit reveals, it’s also moved for cease-&-desist order to curb “online smear campaign” launched by Monster, presumably via TheTruthAboutBang.com website that seems to have garnered broad circulation.  Whew!

Suit filed in US District Court in Southern Florida, where VPX is based, claims that Reign seeks to “shamelessly copy and cause consumer confusion” with Bang, mimicking its black cans with brightly colored, flavor-coded graphics, employs similar positioning language like “body fuel” and employs brand name that neither MNST nor its autonomous Reign unit own.  Rather, VPX itself is exclusive licensee of trademark that’s been registered since Dec 2016 from co called JHO (initials of VPX owner/ceo Jack Owoc) and has used Reign as brand name on bottled pre-workout energy drink line since early 2015.  Suit notes that Reign tagline, “Potent Brain and Body Fuel,” has been lifted directly from VPX’s trademarked phrase.  Even flavor names are confusingly similar, suit argues, as with Reign’s Carnival Candy and Bang’s Cotton Candy.  VPX is seeking to have Reign yanked from market and award of triple damages.

Text of suit also alludes to alleged online smear campaign “buoyed by a sham website and social media/online marketers, attempting to defame and disparage VPX’s Bang energy drinks and CEO, Jack Owoc” that’s alreadysubject of formal cease-&-desist notice for defamation, copyright infringement, disparaging conduct and unfair trade practices.”  In tone reminiscent of Owoc’s rhetorical style, suit adds, “While this smear campaign is not directly at issue in the present action, it is yet another example of Monster’s bad faith, anti-competitive, and sleazy tactics targeting VPX and attempting to confuse consumers.”  VPX exec confirmed that reference is to TheTruthAboutBang.com.

Reed’s Inc shares were trading up today as co closed out fiscal 2018 with flat sales both for Q4 and full year but offered evidence that runway is cleared for return to growth in 2019 thanks to revamped Virgil’s and Reed’s CSD brands, additions of CBD and hard-soda entries, first consistent marketing effort in company history and resolution of mfg issues that dogged co under prior mgmt regime.  As result, 2019 is positioned “to be a truly breakout year,” ceo Val Stalowir said on investor call yesterday afternoon.

For Q4, sales were flat at $9.63 mil and operating loss narrowed to $2.1 mil from $6.1 mil a year earlier, figure which included $3.9 mil asset impairment charge associated with LA plant, whose sale to group including founder/chief innovation officer Chris Reed was just completed.  Best performer was restaged Virgil’s brand, scoring 33% growth in gross sales thanks to well-received Virgil’s Zero Sugar line that debuted earlier in year and now is on track to be $5-6 mil annual biz.  With brand revamp not having kicked in yet, Reed’s brand was slightly down, at time rival Fever-Tree is stepping up US activities and Bundaberg has aligned with Pepsi distribution network.  For full year, REED sales edged up 1% to $38.1 mil and operating loss narrowed to $8.12 mil from $11.75 mil. 

Stalowir anticipates that Virgil’s will continue to clip along, joined by more recently restated Reed’s brand, which similarly got packaging makeover, addition of canned format and zero-sugar extension.  Those additions are shipping this qtr.  Among other highlights, co is prepping its first 360-degree consumer marketing campaign for May 1 targeting digital, outdoor, print, radio and other media to co’s 5 top markets: NY, Boston, Seattle, LA and San Diego.  And next qtr co will go out with foray into hard soda, a canned Moscow Mule entry, as well as Reed’s Wellness Ginger Beer with Hemp Extract.  Together the core brands should grow in 20-30% range, ValStal predicted.

New team of John Bello as chmn and Stalowir as ceo was ushered in after protracted production issues led to massive out-of-stocks and loss of retail presence in 2015, with new team taking founder Reed out of day-to-day and inaugurating “asset-light” model that called for co to no longer handle portion of its own production via LA plant.  In Chris Reed’s hands now, that plant will continue to produce Reed’s brands on contract basis, augmented by outside copackers like Langer’s, just brought aboard and still in shakedown mode.  A private-label push masterminded by Chris Reed also is now in his hands, stripping $6 mil from top line but offering 5% royalty stream over next 3 years, Val and cfo Irish Snyder explained on conference call yesterday afternoon.

Among key innovation unveiled at recent Natural Product Expo West was 7% ABV Reed’s Classic Mule, in regular and zero-sugar versions, made with fresh ginger like the core sodas are.  Those will go out in 4-packs of conventional cans priced at $9.99 starting in Pacific NW, followed in Jun by Northern Calif.  Also new is Reed’s Wellness Ginger Beer, in 10-oz slim cans using 2,000 mg of fresh ginger and 15 mg of broad-spectrum hemp extract using Nano Biologics’ proprietary nano technique claiming 6X faster onset and 6X faster absorption than conventional extracts.  That will pilot late in Q2 in the Pac NW.  Also entering mix in Q2 will be Wellness Ginger Shots.  Outside marketing consultant Paul Curhan, vet of cos like Starbucks and Essentia Water, helped in development of those entries.

Reed’s Is for Those ‘Ready for Real Ginger,’ Not Pixie Dust of Big Brands   On pr front, co will pursue “Ready for Real Ginger” campaign riffing off recent settlement by Canada Dry of class-action suit that found brand “made from real ginger” contains negligible amounts of ingredient.  As reported here, lawyers from Canada Dry owner Keurig Dr Pepper have warned co to back off, but earlier in week, Stalowir suggested to Market Watch that co would be purchasing Times Square billboard to continue feud.  On call yesterday, tho, he didn’t offer further info on that, and he referred to Canada Dry only as “large ginger ale brand.”  Still, “it will be our mission to make sure consumers know there is no material amount of ginger” in larger brands, he said.

For Virgil’s, the new positioning is “Soda Smarter,” exhortation to upgrade soda to one whose zero-sugar offering now has been certified as ketogenic.  As ceo noted, until now, co never has had resources to push out messages like these in meaningful way but it’s built broad marketing and agency team over past year.

Tinkering with Reed’s Ginger Recipe, Process    Under new regime, Reed’s Ginger Brew recipe and production process also are not proving sacrosanct.  Team is “trying to simplify our ginger process,” possibly moving from use of raw, fresh ginger from Peru that’s processed and brewed “to move closer to a concentrate model” that might improve margins, Stalowir offered on yesterday’s call. 

16-Oz Cans May Finally Allow Brands to Crack C-Stores   Reed’s Inc only just has entered canned format with conventional 12-oz packs for its Reed’s and Virgil’s brands.  Now entering mix will be 16-oz cans, viewed as way to better brands’ prospects in c-store channel, where thanks to energy drinks and other entries, the center of gravity has migrated to that larger size.  “Being very well received, being looked at as new and different from the big red and big blue guys out there,” explained sales chief Neal Cohane.  Among early wins has been Circle K heartland div, where its roughly 300 stores have picked up 4 skus of the 16-oz cans.

C-stores have never been receptive to the glass bottles, but even the new 12-oz conventional cans were getting lost in the shelf sets, he added on phone today.  To further juice c-store push, REED has brought aboard as national broker Advantage Sales & Marketing, which boasts relationships with 50K c-store doors.  Neal noted that Reed’s brands are only bevs in Advantage portfolio aside from kombucha brand it carries.   

Rebuilding at Retail    After losing gobs of shelf space, especially outside core natural channel, Reed’s sales team has been on intense rebuilding effort under new mgmt team.  By now, they’ve built presence back up to 35K doors and, by Stalowir’s account, are off to brisk start in 2019, with commitments from 5-10K new outlets, 3K of those “hard-circled already.”  Target is expanding brands’ presence, and Walmart is taking 7 sku’s of the brands for 1,100 stores setting up new craft specialty set; that will represent 40% of total shelf space there, Val noted.  And recently launched Moscow Mule-oriented Strongest entry has picked up 300+ bars and restaurants thanks to new feet on street working on-premise channel.