Beer Marketer's Insights

Beer Marketer's Insights

Calypso Brings on Consultant Outlaw as Prexy to Manage More Ambitious Sales, Marketing Efforts Calypso, fast-growing lemonade brand that's frustrated some trade partners by continuing to operate like a mom-and-pop even as its volume has approached 4 mil cases, has made dramatic staffing change to step things up: it's named its longtime sales consultant Jeff Outlaw to prexy post, with mandate to orchestrate more rigorous sales and marketing efforts. Durham, NC-based Jeff, a former tennis pro who's worked at several new-age bevcos and operated as consultant under Grove Beverage Group name, will step back to more passive role at small beer/bev distributors he operates in Southeast in order to take exec post helping King Juice owner Tim Kezman take glass-bottle brand to higher level, starting by tripling size of sales force that currently numbers 6-7 staffers. Key hires have just been made in West and Midwest and more are expected shortly in South and Mid-Atlantic, with hiring anticipated to be complete within 90 days, Outlaw said. As of this week, co has 100% direct field sales force calling on its national distributor network. Milwaukee-based King Juice, recall, is copacker that's ridden foray into branding to point where it closed out 2013 at about 3.8 mil 12-unit cases, figure that might have been higher were it not for delays launching 3d production line, which in turn caused inventory shortages and made it hard to commit to marketing effort.

"The brand has gotten way too big to be handled with a fragmented sales force," said Jeff, who's worked closely with Kezman to build brand's presence for past 5 years. Tho ranks of lemonade rivals have burgeoned with brands like Cabana and Hubert's, none has ignited and opportunity ahead of Calypso is still sizable, Outlaw believes. Jeff noted that brand's move into Walmart a year ago put it past "point of no return" in terms of playing on national stage. At recent 7-Eleven internal convention in Las Vegas, biggest c-store operator committed to picking up 4 facings at 9,500 corporately owned and franchised units, and Circle K is also planning significant expansion of brand. So there's no question Calypso is on way to ubiquity.

Initially, Jeff has been beefing up field sales and national accounts staff, with field marketing, social media and other marketing disciplines to be focus of later efforts. He's also filling gaps, where appropriate, with brokers, including addition last week of Harlow HK to help service expanding Kroger biz. Tho brokers may play a role in navigating big retailers' systems, "managing our DSD distributors is best in the hands of direct employees of the brand owner, and the initial reaction from key distributor partners just confirms that this is the right move at the right time for this amazing brand," Outlaw said.  
Force Brands, whose BevForce has carved out key role in bev recruitment over past 5 years, formally unveiled move into food segment under rubric FoodForce, as anticipated last fall (BBI, Oct 9). FoodForce emerged from move of many bev execs and entrepreneurs into snacks and other food categories in recent years, and like its bev counterpart, will work out of offices in NY, LA and Austin, Tex. Founder Josh Wand said successful placements at cos like Kind Healthy Snacks, Popchips, Justin's Nut Butter and Beanitos validated move to full-service platform . . . Vukelic family, A-B and Red Bull wholesalers once confined to Buffalo area in western NY, have expanded yet again, this time off footprint of their Saratoga Eagle unit in Saratoga Springs, north of Albany. They're purchasing 1-mil-case AB- Heineken house Bartyzel in Amsterdam mkt contiguous to Saratoga Springs. With operations in northern and western NY, Vukelic family now near 15 mil cases.  
Bev marketers who've struggled to crack difficult Bay Area recall Mission Beverage as brief beacon of possibility, before it was subsumed by Adina and its resources redeployed to that co's ultimately failed effort to build its Holistic and other bev lines. With 5-year non-compete clause now over, Mission Bay's original operator, Flanders-born John Van Loo, has returned from Europe to take another crack under name Waterloo Beverages, starting with Belgian and craft beers like De Struise, Uncommon Brewers and High Water but adding limited array of NAs too, some of them former Mission Bay suppliers like Hint and Purity Organic. Also in mix are glass-bottle CSD brands in Real Soda portfolio (Van Loo started out working with Real Soda) and Ito En tea brands. With nod to Van Loo's Belgian heritage, Waterloo name recognizes stiff odds vs distribution startups, he said. It's started small from base on Pier 50 on south side of SF, just adding 3d truck now. Coupla drivers from old days were quick to rejoin him. At this stage, Van Loo makes no bones about his suppliers having to pick up most of burden of opening accounts and developing brands. During his European exile, John kept his hand in by helping Hint build its UK and France presence . . . With tech-dependent aspects of co like Web site and gift cards taking on greater importance, Starbucks has elevated its group prexy of Global Business Services and cfo, Troy Alstead, to coo, tho ceo Howard Schultz was quick to dismiss any speculation that this represents move to set up successor. It's chance to create new channels of revenue and profit outside 4 walls of stores and "not about succession planning, and this is not about me in any way planning to or even thinking about leaving he company," he told Reuters. That still seemed to be way many on Wall Street were reading it, tho. Alstead, 50, is 22-year SBUX vet who's served in diverse roles there, including overseas stint as coo of Starbucks Greater China. His cfo role has been picked up by Scott Maw, 46, previously svp for corporate finance.  
Tho Asian-style drinking vinegars like Pok Pok's Som have been garnering lotsa buzz, a few marketers have become intrigued by notion that America boasts its own such tradition dating back to colonial days, under name "shrub." (By one theory, word derives from same Persian word that gave us "sherbert" in English.) Just a few aisles away from bustling booth of Pok Pok, where employees of star chef Andy Ricker were sampling Som, the vinegar and oil marketer Sonoma Harvest was takin' flier on shrub line devised for one of its core customers, TJX, which operates TJ Maxx and Marshalls chains. "I have no idea where it's going - it could be life changing" if right positioning can be figured out, said co's longtime marketing consultant Arthur Perkins, who'd never heard of genre 3 months ago but concocted line in barely 3 weeks, using elegant Italian-made glass bottles that arrived just the Fri before show's Sun opening. With TJX as solid test platform, shrub line is being pitched as versatile mixer that lends itself not just to spirits-based cocktails but can be mixed with champagne or used in non-alcoholic libations. Perkins was mysterious about mfg process, noting only that it's being done locally in Sonoma via more mechanized method than artisanal mode of 18th Century. Pricing is still provisional but co is eyeing $12-13 per half-liter bottle at retail, positioned a bit above mainstream premium mixers like Stirrings.  
For past coupla years Brew Lab Tea has been garnering attention in NY foodie circles for the custom tea blends and tea cocktails it creates for high-end eateries like Westville. At Fancy Food, Brew Lab partners Jennie Ripps and Maria Littlefield offered consumers a chance to replicate these recipes via packaged line called Owl's Brew, which began trickling out to retail shelves this past Aug. Line packed in 8-oz and 32-oz metal canisters attempts to offer versatile base that can support range of different spirits, and even beer, in contrast to offerings of rivals that may be limited to single drink like Bloody Mary or Cosmo, or particular spirit. Line also addresses frustration Ripps said she and Littlefield felt at home cocktail mixes that offered pale shadow of inventive drinks being conjured up in cocktail lounges these days.

Like the pair's custom blends, Owl's Brew is made from freshly infused whole-leaf teas, spices and fruits without addition even of natural flavors. Finding copacker was issue - most wanted to "upgrade" line to something more conventional, Jennie recalled - though the women finally found accommodating one in Vt.

Brand launched in 32-oz canisters (good for 16 cocktails) in 3 basic blends, priced at $12.99-15.99, and at show added 8-oz unit (good for 4 cocktails) priced at $6.99-8.99. Also in mix now are 3-packs of smaller units going for $22-25. The 3 agave-sweetened blends are coconut-based Coco-Lada, Pink & Black (Darjeeling with hint of hibiscus) and The Classic (English breakfast tea with tart twist). For summer, Owl's Brew may add lighter, more refreshing entry based on green or white tea blend, Jennie said. Line has entered retailers like Fairway Market in NY, BevMo on West Coast and Whole Foods units within chain's Pac NW, Rockies, North Atlantic and New England divs. It goes thru Associated Buyers in Northeast (including its Gotham Artisanal unit in NY), Unified Grocers for W Coast and Green Shoots elsewhere. Info at TheOwlsBrew.com.  
Franchisees for years may have blocked any plans for Dunkin' Donuts to enter RTD coffee market, but donut/coffee empire has added another revenue stream beyond the stores themselves with move to license WhiteWave Foods to produce Dunkin' Donuts Coffee Creamers for groceries and club stores. Items will be made from real milk and cream, packed in quart-sized bottles in Original, Fat-Free, Extra Extra and Unsweetened versions and merchandised in refrigerated section. John Costello, Dunkin' Brands' prexy for global marketing & innovation, seemed careful to stress benefits to franchisees, saying, "Consumers have told us they love the idea of Dunkin' Donuts Coffee Creamers at their grocery store, and we feel this launch will strengthen our brand's association with hot coffee, increase our visibility at grocery stores around the country, and ultimately drive more hot coffee sales when consumers visit our restaurants." Dunkin's been familiar brand in grocers' bagged-coffee sections since 07, when it set up distribution alliance with Folgers marketer Smuckers. So far, tho, move into RTD coffee still seems no-no to franchisees who fear it would cannibalize their in-store sales.  
Is energy drink hysteria of past year blowing over? Developments out of LA this week brought another sign that it might be. In local climate where at least one City Council member wants city to consider implementing 18-yr-old age restriction on energy drink purchasers, influential LA Times has decided to take common-sense stance on narrower city council proposal from last yr that moved back onto radar this week. In that motion, Councilman Bernard Parks wants to study whether LA should limit city workers' energy drink consumption. This past Mon, a committee sought input from city's medical dir Dr Arthur Manoukian, who "sounded pretty skeptical" about idea. "My main problem is I don't see how we can monitor this," he told committee members. Enter LA Times, which seems to be urging pullback from energy drink furor, opining that this is all a waste of taxpayers' time and money. Paper noted, "There's no strong evidence that chugging Red Bulls at work creates unsafe conditions . . . What's next? Padlocking the coffeemaker? Banning Big Gulps at the office? We're not New York City." Execs at Red Bull North America and Monster Beverage, both based in SoCal, doubtless are breathing sigh of relief at throttling down of anti-energy rhetoric . . . Continuing to turn up heat on CSDs, Center for Science in Public Interest this week harnessed murderer's row of nutritionists and health orgs to urge fast feeders to remove soda and other sugar drinks from their kids' menus. Open letter to 23 of biggest chains, including Wendy's, Burger King, Chick-fil-A and Applebee's, urged them to follow lead of rivals like McDonald's, Subway and Chipotle in dropping sugary bevs from those menus. "When it comes to children, restaurant chains must exercise some corporate responsibility," said CSPI nutrition policy director Margo Wootan, in letter signed by 100+ health orgs like Academy of Nutrition & Dietetics, American Diabetes Assn and MomsRising.org, along with 60+ nutritionist experts. "Some already have, but the rest should follow suit" . . . After legislature last year rejected bill that would require food labels to indicate whether item includes GMO ingredients, Colorado legislators are working on new bill that takes less disruptive tack: allowing food marketers option of labeling food that doesn't include GMOs.  
Looks like energetic entrepreneur Michael Salaman may be getting another chance to build Skinny trademark into successful bev, snack and food brand, this time via privately held entity. With no further bidders emerging by time of bankruptcy court auction in Philadelphia this month, Salaman's Skinny Nutritional LLC acquisition vehicle has landed trademark for amount of $1.5 mil, minus $131K in debtor-in-possession financing he'd provided publicly traded Skinny Nutritional Corp during bankruptcy bout. Tho Michael has told BBI he can't comment until transaction closes in coming weeks, he appears to be aligned with local investor Mark Turnbull, who appears on court documents as associated with purchasing entity. As part of overall outcome, dispute has been settled with Trim Capital, which had claim on key assets, notably Skinny trademark and range of related ones like Skinny Bar, Bubbles, Cereal, Chips, Cocktails, Cola, Energy, Cosmo, Java, Juice, Shot, Tea, Tini and slogans like Get the Skinny. Auction had been watched with some interest, given seeming relevance of Skinny trademark to many consumers' weight concerns, and some observers are surprised that no serious rival bid ultimately emerged, given success that other skinny-themed brands like Skinnygirl cocktails have enjoyed. Recall that co has had rollercoaster of a ride, recruiting such well-known figures as former Coca-Cola Philadelphia bottler Ron Wilson as investor/execs in early days, then becoming early victim of FDA's stepped-up labeling vigilance, which forced reformulation of brand without active weight-loss ingredient, which agency deemed incompatible with brand's use of food descriptor "water." Since then, Salaman has worked to build brand as zero-calorie refresher sold inexpensively in large-format stores, while prepping extensions in range of food and bev categories. Stay tuned for word on how approach may change this time, or who else will be on team, assuming deal closes as planned.  
Kombucha startup Health-Ade, flush off receiving investment from First Beverage Group, has gone to industry leader GT's to fill its top operations role as it scales up production. LA-based co has recruited Ramon Canek, former coo/vp operation at GT's producer Millennium Products to serve as its own vp operations. "Now that we're growing, it's more important than ever that we have experienced and passionate people on our team," said Health-Ade cofounder Daina Trout. A 10-year vet at GT's, Canek would have had to navigate difficult category recall by UNFI and Whole Foods in 2010 after continued in-bottle fermentation was causing excessive alcohol levels. He joined GT's in its early days, after earlier working in chain of automotive body shops . . . FRS prexy Dave Henderson and sales chief Rich Libonate had said they expected to move on sometime during first half of 2014 as energy drink marketer's operations were merged with those of its affiliate Nutravail (BBI, Nov 21). That transition appears to have occurred sooner rather than later, with Nutravail ceo Rick O'Neil, a lawyer by training, now taking reins of both entities, it seems. With Nutravail based in Chantilly, Va, and FRS in Calif's Bay Area, looming question is whether those will be consolidated. So far, O'Neil hasn't responded to several inquiries about FRS over past coupla weeks. Libonate confirmed that he's exited and is seeking new gig, but declined to comment on status of other key execs there. Among them, marketing chief Jean Ercolani is believed to be continuing on, as quercetin-based FRS brand seeks ignition after investment that's believed to have exceeded $100 mil to date. Henderson and Libonate had said in Nov that, after overseeing broad restage, it was good time for them to move on. Prior to FRS, Henderson had held financial posts at cos like Commerce One and Genentech while Libonate has had long run in bevs and snacks, primarily at Cadbury Schweppes Americas Beverages and its successor Dr Pepper Snapple Group within Snapple bev and Adams confectionery units. Nutravail is contract producer of supplements, chews and other items.

Still more coverage from last week's Fancy Food Show coming in upcoming issues, BBI readers!  
PepsiCo has revved up marketing engine behind its Sparkling Ice fighter, Aquafina FlavorSplash, even as it seems to be continuing with aggressive promotional pricing that's seeing brand priced well below $1 in some retailers. For marketing splash, it's going directly after teens by recruiting 17-year-old pop singer Austin Mahone as its "digital and brand strategist" and putting him and new single "Mmm Yeah" front and center in national TV ad that broke during Grammy Awards on Sun. "A creative take on water . . . make a splash!" says voiceover. Campaign includes "Make a Splash" contest kicking off Feb 10 program that calls on teens interested in music, entertainment, culinary arts, fashion and other pastimes to offer why they deserve their dream to become a reality, with 7 winners over course of year. Initial segment is music-focused, inviting participants to upload video for chance to shadow Mahone around NY. Aquafina sr dir Rebecca Granne indicated that brand is being viewed as way to get teens hydrated. "We look forward to inspiring teens to 'Make a Splash' in their everyday lives with our year-long program, similar to how our products showcase how much more fun water can be with customizable hydration options," a reference to liquid water enhancers that are part of brand mix. Recall that Coca-Cola's entry into segment, Fruitwater, early on received aggressive marketing campaign, tho so far that doesn't seem to have translated into great deal of share vs leader Ice.

Despite PEP's aggressive marketing push, BBI readers report continued promotional activity at retail that's seeing brand priced well below $1 - and even dump bins at QFC stores in Seattle area that have been offering warm bottles free behind sign saying, "Go Hawks! Free. Free. Free." (Now that's commitment to home team!) If that portends imminent delisting, PEP's multi-tier campaign could help re-energize retailers' commitment.  

 

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