Sysco, leading food distributor in US, will shell out $3.5 bil to take over its main rival, US Foods, in major deal that "analysts have long predicted" would eventually happen in consolidating food distribution business, noted NY Times. Sysco has "gobbled up dozens" of smaller competitors over the years, and US Food deal should up its share to 25% of segment in US, while nearest rival, Performance Food Group, has just 5 share, added Times. Deal could face some pushback from gov't regulators though. "In certain regions the combined market share is going to raise some flags," predicted Andrew Wolf, managing dir at BB&T Capital Markets. "They're going to have to make some divestitures." Sysco ceo William Delaney acknowledged as much on conf call yesterday announcing deal. Sysco anticipates combo of 2 cos will result in $600 mil in cost savings in first few yrs. Under terms of deal, which is $3 bil in stock, $500 mil in cash, investment firms Kohlberg Kravis Roberts and Clayton, Dubilier & Rice, owners of US Foods, will get about 13% stake in Sysco.  

In sharp departure from 15+ years of distribution history, Red Bull North America has agreed to carry limited # of Evian sku's in its company-owned operations in Southern Calif and south Fla. Word is Red Bull Distribution Co will pick up pair of Evian sku's, as Danone pursues new hybrid route to retail for its core bottled-water brand after termination of longstanding alliance with Coca-Cola (BBI, Nov 15). Tho deal involves just a coupla sku's, it represents long-discussed but never realized move to add non-competitive brands to Red Bull trucks, to help carry overhead of self-distribution scheme. It also may offer hope to some of RBNA's indie wholesalers that perhaps they too might finally be allowed to defray their overhead by mingling non-Red Bull sku's on the trucks, perhaps starting with Evian if that test is deemed successful. In past years RBNA is believed to have held discussions with non-competitive brands like Muscle Milk and Vita Coco over distribution opportunity, but never moved forward. RBNA has policy of not discussing with media what it regards as internal developments, but Danone rep Michael Neuwirth confirmed arrangement. As part of brand's route-to-market transformation, Danone Waters of America and RBDC "will be testing a distribution partnership in 2 of Evian's key markets, Southern California and Central/Southern Florida," he said in email as issue was going to press. "In the test, RBDC will distribute Evian in small-format channels such as convenience, drug, and select foodservice and specialty retail. The partnership will leverage complementary brand strengths to enhance merchandising and promotion opportunities on a store-by-store basis."  

Christopher Reynolds, former bev banker and consultant who'd taken a break from bevs for a spell, is back in our biz with role as vp sales & marketing at Summit Beverage Group, new name for copacker in SW corner of Va that struggled under prior ownership as First Fruits. After serving in banking roles at Merrill Lynch, Wachovia and Rogo Capital, Fla-based exec had served as consultant to bevcos such as Liquid Lightning while also taking biz development role outside industry at co called Fuel Emulsions Int'l . . . Pittsburgh-based marketing vet Lee Brody, who shortly steps into staff role at Splash Beverage Group incubator being launched in Fla by his former Marley colleagues Kevin McClafferty and Robert Nistico, has also signed on as advisor at Meta Brands, NJ incubator founded by natural-foods vet Eric Schnell, cofounder of Steaz, where Lee earlier worked in marketing role. His title is vp marketing but it's contingent role, in keeping with Schnell's plan of building strong bench of experts available to step in as client needs dictate . . . Clayton McArthur has taken on job as Midwest regional sales mgr at Fairlife LLC, marketer of Core Power protein line that moves thru Coke bottling network.  

Coca-Cola's goal is to be "most socially responsive and engaged organization in the world," proclaimed Doug Busk, co's dir of connections innovation, speaking at Wed "Real-Time Marketing Conference" hosted by Assn of Natl Advertisers. To do so, KO has implemented company-wide, global platform dubbed "Hub-Network" that "connects front lines of engagement teams" around world to determine "what conversations are occurring in this moment . . . and require our attention right now," without delay of going thru centralized Atlanta hq. It allows co to "listen at every level to inform our global voice," to "analyze" and "identify the right time to talk," and to "find the folks that are really driving the conversation." And it allows them to apply "common set of metrics" to measure success of social media activity, noted Doug, who earlier made mark in social media as part of landmark Obama election effort in 08.

Doug was one of at least 3 speakers in morning session alone who cited Oreo's Super Bowl Twitter post as launching point of "real-time marketing" revolution. That's when Oreo's media team created tweet (http://bit.ly/18kLW9k) stating "Power Out? No problem," with attached image stating "you can still dunk in the dark," all within moments of lights and power going out in stadium during big game. Tweet received nearly 16K retweets, over 6K favorites (most of which occurred within an hr of original post). The moral: gotta be ready to go with "content on the fly," sez Doug. Coke's been able to do this, most notably, with tweets about "Royal Baby" within 8 minutes of his birth and via ongoing #WorldCup Tweets leading up to 2014 games; both are global events that are highly engaging among consumers and non-consumers alike. Hub Network increasingly allows KO to tap into global events such as these, as well as provide local content in each of their mkts.  

Capturing interest in Okla from some key regional chains, Xyience Xenergy has signed on Miller/Coors house Capital Distributing as new DSD partner, with view to cracking 1,800 retailers within 8-county region of Oklahoma City metro, including likes of 7-Eleven, Circle K and On Cue c-stores chains and Buy for Less, Crest Foods and Homeland grocers. Capital, which has been expanding its NA portfolio despite extensive roster of beers, is picking up all 8 core Xyience sku's as well as its more recently launched noncarb hybrids Xenergy + Tea, Lemonade and Hydration. Capital buttresses presence that was forged in Tulsa market by indie Coke bottler Love Bottling, which has gotten brand into likes of Buy for Less, Homeland and Reasor's Grocery, said vp US sales Reuben Rios. Reuben noted to BBI that Capital is among numerous beer wholesalers around US who seem to be taking 2d look at NAs and approaching co about its natural-energy line. Capital's territory is mainly worked on Coke side by Coke-owned Coca-Cola Refreshments operation, ruling that out as distribution partner.

Monster Beverage has shown it's not afraid to stir pot on distribution, pulling out of systems of its strategic allies, Coke and Bud, in NY when it felt it could do better. Now, other side of company is makin' waves: frustrated with execution on its Hubert's Lemonade brand - at this point, viewed as co's highest-potential non-Monster brand - MNST has been experimenting with Snyder's/Lance Inc pretzel distributors in increasing # of markets. More commonly, move into snack houses is undertaken by early-stage co having difficulty cracking established bev DSD shops, but it's unusual for large and practiced DSD operator like Monster Beverage.

Tho co is being terse about move, it had earlier moved into Lance operations in Texas, long a challenging market for non-alcoholic distribution - but has also dropped conventional DSD houses in markets like Colo and NJ in favor of Lance operation. While acknowledging transition during conversations at recent trade shows, div prexy Tom Hicks hasn't said whether that's part of more sweeping plan. In recent weeks he hasn't been available to continue discussion.

Move seems to balance coupla delicate tradeoffs. On one hand, Hubert's is only bev on Snyder's/Lance trucks, giving it undivided attention of Lance sales force. And moves come at time that LNCE has been launching # of initiatives with its so-called independent business owners (IBOs) on first anniversary of what it calls its "DSD transformation." On other hand, as displaced bev wholesalers have been quick to point out, Lance's drivers don't work on commission and may prove to be disinclined to deal with heavy lifting involving liquid product rather than lighter snacks that dominate their portfolio under brand names like Lance's, Snyder's of Hanover, Pretzel Crisps and Cape Cod. Hicks, it might be noted, comes from Naked Juice, where he enjoyed benefit of captive DSD network where share of mind was never an issue. By contrast, Hubert's has had to scramble to maintain its mind share at indie DSD houses that sometimes carry rival lemonades, not to mention half-and-half tea/lemonade combos from tea makers.  

Hiring of pair of new-age bev vets signals more concerted push by Essentia Water to build mainstream availability, now that high-pH brand has proved out in mainstream grocery as well as natural channel, owner Ken Uptain says. After quietly and inexpensively building significant natural-channel presence, Essentia entered mainstream grocery 2 years ago and seems to have sold thru briskly in both channels, with overall sales up in 60% range this year. To date, co has built DSD network in Northeast, with Pacific Northwest a likely possibility for next DSD push. But co also maintains direct customers such as HEB, Kroger's Fred Meyer banner and Delhaize's Hannaford Bros and Food Lion banners, and moves thru broadliners like UNFI and Tree of Life for natural channel and for other regions. Drug chains have been tempting target over past year but none are aboard yet, Uptain said. Potential channels like c-stores are still off in the future, as is any effort at expansion overseas.

As reported (BBI, Dec 3), Bothell, Wash-based co has brought on Cadbury vet Neil Kimberley as vp strategy and brand development and Starbucks and Pyramid Brewing vet Paul Curhan as vp marketing and innovation. Both had been consulting for good part of past year before going full-time at co. Curhan is Seattle-based, while Kimberley will remain based in Penn, good perch from which to oversee growing Northeast presence. Also on team is branding consultant Tahne Davis, who oversaw label upgrade last year and now takes on staff role as creative dir and brand mgr. Next stage, Ken said, is to start adding field sales and marketing staff. "It's time to get above the radar with the help of these pros and build our team," he said. Curhan has been convening focus groups to finetune branding proposition, and co is ready to execute its 2d social-media promo.

Essentia is playing in higher-pH segment that has seen Aquahydrate go quiet after making lotta noise under now-departed ceo John Cochran, who left for moonshine co, but brands like Real Water and Eternal Water growing. As a sourced water, Eternal is positioned a bit differently, and with different production dynamics, while more functionally oriented Real Water seems to be attaining good sell-thru at retail, Ken allowed. It all makes for vibrant segment that's garnering greater retailer interest and consumer awareness, and in turn makes it good time for Essentia to put foot to pedal. So far, it's been self-funded and operating profitably, Uptain said, but he may try to bring in modest amount of outside funding soon.