Beer Marketer's Insights
Quick: can you guess who's marketing a whole bean coffee line with roasts that include Smooth, Oye Como Va and Evil Ways? Too easy! Iconic guitarist has launched The Carlos Santana Coffee Co, partnering with 4th-generation importer and roaster called Iconic Global Coffee, with some proceeds from the coffees and extensive apparel line going to Milagro Foundation that Santana established in late 1990s. Entries like Smooth medium roast and Evil Ways dark roast are offered in 12-oz bags prominently branded with imagery associated with Santana. On co's website at CarlosSantanaCoffeeCo.com they go for $20.
Entering prebiotic fray has been a glass-bottle agave-based play, Mayawell Bubbly Prebiotic Tonic, from 2 biz partners located in Austin, where brand is based, and Oaxaca, Mexico, where core ingredient is hand-picked. Sparkling drink, which has quietly expanded from Texas base to LA and NY in recent months, is based on proprietary Pregave formula using organic agavin and organic agave nectar, along with 5 g of dietary fiber and 4 g of unrefined sugar, coming in at 35 calories per 12-oz bottle. It's out in Pear Lime Green Tea, Pineapple Mango Turmeric and Strawberry Ginger Hibiscus.
Zevia Snags $200 Mil Investment from Canada-Based CDPQ, with Visions of Establishing Global Reach
LA-based Zevia LLC, pioneering marketer of canned stevia-sweetened sodas, has snared its biggest investment yet, $200 mil from Montreal-based Caisse to Depot et Placement du Quebec. Investment seems to be a rare one to be announced by diversified CDPQ in CPG space, with its closest investment to consumer arena being pickup of assets of struggling Cirque du Soleil earlier this year. But as it looks to grow globally in markets increasingly receptive to zero-sugar entries, Zevia cited "CDPQ's solid expertise in asset management, global reach and strong commitment to environmental, social and governance (ESG) values." Wellvest Capital served as financial advisor to Zevia, which for past decade has been run by SPINS founder Paddy Spence. By now brand reaches 35K retail locations in US and Canada with little recourse to DSD, and has ridden palatability improvements to stevia as it's built out portfolio that includes sodas, energy drinks, organic teas, mixers, sparkling water and even a new line of Kidz drinks. Nielsen data indicates Zevia has hit $100 mil 52-week sales mark in scanned retail channels.
CSD volume increased 3.6% with solid avg price gain of 4.8% for 4 wks thru Dec 12 in Nielsen all-channel data reported by Goldman Sachs' Bonnie Herzog. That's down from +6.5% volume growth pace for 12 wks, but CSDs ticked back up to +4.3% in latest 2 wks as the category continues to benefit from increased at-home consumption trends. Coca-Cola CSD volume decelerated from +5.3% for 12 wks to 1.6% gain while its avg price edged higher to +5% for 4 wks. KO regular sodas were up just 0.2% last 4 wks while low-cal brands gain was halved to +4.5%. PepsiCo CSD volume was up 5.8% (vs +7.6% for 12 wks) with avg price increase of 2.5% last 4 wks. PEP low-cal brand volume shot up 13.1% for 4 wks while regular sodas gained 2.8%. Keurig Dr Pepper continued to outgain its larger rivals. KDP CSD volume gained 7.7% (down from +11.5% for 12 wks) with 5% avg price increase last 4 wks. KDP low-cal brands still up double-digits (+11.5%) while regular sodas slowed from +10.7% to +6.7% last 4 wks. Private-label CSDs still struggling as volume slid 9.6% on avg price increase of 3.4% for 4 wks.
PROFILE: Alt-Yogurt Maker Lavva Harnesses Pili Nut for Plant Milk Line Rolling Out thru Whole Foods
Impressive hype machine of Laird Superfood likely has put pili nuts on radar of many consumers for first time, now that Oregon-based co has launched snack line based on nutritionally robust ingredient (BBI, Oct 8). But it's not the first health & wellness player to harness complete-protein characteristics of Southeast Asian ingredient: Brooklyn-based brand called Lavva has been running with pili-based yogurts for coupla years now and in recent months rolling out thru Whole Foods chain a plant milk employing pili nuts, just joined by a creamer entry. Nut brings big nutrition and sustainability benefits, containing all 8 essential amino acids as well as lotsa magnesium and vitamin E and being largely wild-harvested, serving as regenerative crop requiring nothing more than rainfall to subsist.
Anna-Lena Kamenetzky, who just resigned board seats at KDP and coffee giant Jacobs Douwe Egberts, has joined board of insurgent brand Kitu Life Super Coffee. Kamenetzky, who came by those board seats by virtue of serving as partner at JAB Holding Co, a post she also resigned to pursue her own investments via Kamenetzky Family Ventures, will help founding DeCicco brothers navigate onboarding of brand into massive Anheuser-Busch InBev wholesaler network after brewing giant took a minority stake in NY-based Kitu Life. "I've been very impressed by Super Coffee's dynamic growth in both the DSD retail channel, as well as their healthy mix of ecommerce sales," she offered. "It's rare to see a brand of this size exercise competency in stores and online." She joins 5-person board that includes brand founders Jim, Jake and Jordan DeCicco and lead investor Phillip Sarofim, the 30-something son of Texas billionaire Fayez Sarofim who operates PS Ventures fund. Kamenetzky, a former Goldman Sachs vp, played instrumental role in assembling coffee assets wielded by JAB into formidable rival to Nestle and Starbucks via publicly traded JDE Peet's and Keurig Dr Pepper cos. As co-head of JAB Consumer Fund she claims to have pulled in $17 bil over 7 years, per her LinkedIn profile.
Call it the Trojan horse strategy. VPX Nutrition has been aggressively pushing its forthcoming hard-seltzer launch, Mixx, toward Bud network in hopes it will soften wholesalers up to reclaim Bang Energy brand should VPX find a way free of its PepsiCo alliance. Co has been meeting with statewide networks of A-B houses (we hear Tenn is next up this week) but receiving some pushback on contract that the beer wholesalers feel doesn't adequately reflect realities of alc segment, a new arena for VPX. No further word on fracas with PepsiCo, tho we hear VPX execs still may be within window to change their attempted termination from one not-for-cause to for-cause, if they feel they have evidence that PEP has dropped the ball on brand. Arbitrator had recently quashed effort to exit blue system, saying VPX would only be able to exit immediately if it terminated partner for cause (BBI, Dec 9). In recent weeks, we hear Pepsi has stepped up efforts behind Bang to get it growing again on national basis, adding incremental displays and otherwise working brand, tho so far efforts haven't been enough to stem its share erosion. VPX execs maintain that contract specifically requires that PEP grow brand at least in line with category.
CANNABIZ: Yes, CBD Foods/Bevs Slumped, New Hope Allows, but Still Plenty of Reason to be Optimistic?
Whether it was challenges of Covid-19 pandemic or consumer reluctance, sales of food/bevs with hemp (CBD) fell 75% in 2020, per New Hope Network/Nutrition Business Journal. Both impulse purchases at retail and sales at coffee shops and cafes declined this year, noted New Hope sr industry analyst Clair Morton Reynolds. While most sales of hemp/CBD products so far take place at c-stores, that's a problem because that channel is "not ideal for food," noted Justin Singer, ceo/co-founder of Caliper Foods, a Colo-based supplier of cannabinoids to mfrs and consumers. "It's not where most people shop for food," he said. But it's still early days and "I still think RTD is an untapped category," he added. "The idea that RTD beverages have reached their limit in independent grocers and convenience stores is laughable. There is massive opportunity still waiting." Beyond bevs, Singer sees plenty of opportunity for hemp/CBD in drink mixes, recovery products, ice cream and coffee, per report.
FOLO UP: Restaged in 8-Oz Cans, Quokka Jitter-Free Functional Coffee Heads Back into Market
Another player in burgeoning realm of super-functional coffees, Quokka Brew, has completed switch from small refrigerated glass bottles to shelf-stable cans. Oat milk latte brand created by recent UC Berkeley grads George Passantino and Ofek Arush is going out this week in 8-oz slim cans that contain 135 mg of caffeine from Fair Trade Coffee, but just 60 calories per can, with sweetener lift from modest 4 g hit of cane sugar. For now they're offering shoppers any flavor they want as long as it's Vanilla, priced at $25.99 per 6-pk on QuokkaBrew.com. (Website also offers "420-pack" for $1,500.) Recipe includes L-theanine, ginseng and green tea extract, balancing caffeine lift with focus benefit, and putting Quokka in nascent class that includes powdered entries like Clevr, which just scored investment from Meghan Markle, and Boost Coffee, launched yesterday by Laird Superfood (BBI, Dec 17). As we profiled this past summer, founders had grown up together outside LA and devised Quokka in their junior year at Berkeley as jitter-free aid to studying, eventually marshaling army of student volunteers to get quirkily branded glass-bottle shots out to other Calif campuses (BBI, Jul 10). Brand name refers to Aussie marsupial that some have divined to be happiest animal on earth. Partners got restage effort off ground in Aug with crowdfunding campaign that raised $75K.
More on antitrust front, following our exploration of issue last week (BBI, Dec 14). At time California Atty Gen'l has started looking into craft brewer access to mkt in the state as well as recent forced consolidations, public health advocates at Alcohol Justice (AJ) are asking AG to "independently investigate ABI's attempted takeover" of Ace Bev in LA "to determine the extent of that acquisition's likely anticompetitive effects on the California beer market, along with the ensuing duopoly that will be established there" between Reyes Holdings and ABI in Calif. This is new arena for Alcohol Justice, which usually is a voice for stricter regulations on alcohol access and mktg and higher taxes, and it should be noted that the "takeover" it refers to isn't "attempted," it already happened. Ace deal closed last Friday, so unclear why Alcohol Justice thinks eggs can be unscrambled. Still, it's another indicator that antitrust is increasingly in air these days. And while focus is on beer, issue is relevant to NAs as neither A-B branches nor Reyes beer houses historically have been receptive to outside NA brands, tho that might be starting to change.

