With thriving biz selling homebrew kombucha kits, Kombucha Brooklyn has had somewhat equivocal stance toward its bottled RTD lineup (BBI, Jul 2). But new 12-oz clear longneck glass bottles trickling out to Whole Foods and other retailers comes as sign that Brooklyn-based co has recommitted to that side of biz. New look, which replaces more jar-like 16-oz glass bottles, reps effort to demystify segment, as cofounder Eric Childs noted in blog post last week. "Many kombucha drinkers believe that sour = power. This is not the case. In fact, it is at the core of why Kombucha Brooklyn was formed. We wanted to give people a bottle of kombucha that would provide all the health benefits loved by enthusiasts in a brew that was both easy and enjoyable to drink." New look takes KBBK, as it's catchily called, in direction forged by brands like Austin's Live Soda that seek to reach kombucha newbies by taking elixir just a short step beyond what folks are accustomed to drinking (BBI, Mar 11 and Oct 11). In blog entry, Eric cites smoother, more consistently produced flavors - "kombucha you can count on" - as well as new look. "You might think our bottles look more like a soda than a bottle of 'buch. Well, you're right! What better way is there to get the average soda drinker to pick up a bottle of 'buch than to make it familiar to them?" Childs, who's also been flogging newly published book he co-wrote with his wife and cofounder Jess, told BBI he'd be ready to offer more details about new thrust in coming weeks.  

Change.org organization is now targeting Coca-Cola for behind-scenes contributions exceeding $1 mil that it made in successful fight to head off GMO labeling bill in Wash State, reminding consumers in process that Coke is owner of healthier-positioned brands like Honest Tea, Odwalla and Vitaminwater. "Many companies, including Dole Food Company and Mars Inc, have responded to consumer pressure and stopped giving money to fight GMO labeling," org writes in appeal to public. "We are calling on Coca-Cola to join them. While sales of Coca-Cola's carbonated soft drinks have recently been dropping, the company's financial future is increasingly tied to the brands it markets as healthier, including Honest Tea, Powerade, Odwalla, Vitaminwater and Simply Orange. It's time for company policy to respond to its customers' growing level of health consciousness and demand for consumer choice." Change.org is hoping to capitalize on backlash among some consumers when they learned that Coke and other marketers quietly funneled contributions via Grocery Mfrs Assn, which raised $11 mil in manner that Wash AG contended violated campaign disclosure laws. Coke's backdoor contribution likely was motivated by backlash a year earlier in Calif, when Coke's more visible role fighting anti-GMO initiative there prompted outrage from some consumers at its Honest Tea brand.  

New survey by UCLA found that efforts to curb child obesity rates in Calif have resonated with parents when it comes to bevs but not for fast food meals so far, reported Sacramento Bee. UCLA researchers reported that consumption rates of sugar-sweetened bevs among kids age 2-5 in previous day fell from 40% in 1999 to 16% in 2009. But that "sharp decline" in sugared bev drinking "is offset by a steady rate of fast food meal consumption," as nearly two-thirds of Calif kids in age bracket eating at least 1 fast food meal a week and 29% eating at least 2. That rate was particularly troubling in Latino communities, where survey found 70% of kids in this age group ate fast food at least once a week . . . As NYC Mayor Michael Bloomberg nears final month of tenure, NYC's Health Dept has launched what it calls "provocative" new ads in series targeting consumption of sugared bevs. Ads are "expansion of an existing Health Department program" and include TV spots airing on local stations over next few weeks and print ads in subway cars thru Jan, reported CBS News. One spot shows young girl drinking a box drink labeled "fruit drink" with caption, "Your Kids Could Be Drinking Themselves Sick."  

 US District Court Judge Claudia Wilken gave tentative approval for $5 mil settlement from Muscle Milk to resolve class action filed by consumer from California who sued co for "alleged fraud and misrepresentation," reported Courthouse News Service. Judge Wilken signed off on payout that won't be finalized til May to "consumers duped into buying Cytosport's line of Muscle Milk products" between 2007-2012, noted report. Settlement absolves co of any future personal injury claims. Recall Cytosport settled class action suit filed by lead plaintiff Claire Delacruz earlier this yr that alleged Muscle Milk ads were false advertising. Consumer believed milk and powdered mixes to be "healthy and nutritious," however, "with almost 50% of their caloric content coming from fats, the products were equivalent to fat-laden junk food," claimed Delacruz. Judge also directed Muscle Milk to begin notifying users about settlement. Settlement likely clears another impediment to efforts by Credit Suisse Group to find buyer for co (BBI, Oct 28).

Coca-Cola's closing on full ownership of LA-based Zico Beverages LLC, announced Fri, caps mixed success on coconut water pioneer so far by incubation arm VEB. On one hand, Zico has established strong position as #2 player behind Vita Coco, which is ensconced in rival Dr Pepper Snapple Group system, even as PepsiCo's bet on sector, ONE, has lost considerable ground in recent years. But Zico itself seems to have lost some ground to Vita Coco, a victim in part of more deliberate move into big-box retailers like Walmart and, some in market believe, taste challenges of from-concentrate formulation employed in brand's distinctive PET bottles. Some also view co's close ties to Trader Joe's chain as having alienated rival retailer Whole Foods, at cost of larger presence in those influencer-reaching stores.

But neither Coke nor Zico founder Mark Rampolla, who moves to consulting role, have lost any ambition for 9-yr-old brand that's broken ground on many fronts, from move into PET bottle (while keeping aseptic boxes in mix) to establishment of indulgence positioning with once controversial but now much-imitated chocolate sku. "With our acquisition, we plan to innovate in all aspects of the consumer experience and increase both velocity and distribution to position Zico for even more growth," per statement from Deryck van Rensburg, prexy/gm of Venturing & Emerging Brands. "This announcement is the sign of a continued beginning for the brand, with more resources, support and cachet to come." In phone conversation Mark echoed assessment: "I believe that now that The Coca-Cola Company fully owns Zico, it will give it even more resources and emphasis," he said. That's why he felt it of greatest value to go with KO insider like Scott Uzzell as new prexy, he noted, even tho he'd also interviewed accomplished pros from outside Coke system.

According to KO announcement, Rampolla, now 44, moves out of day-to-day mix as "non-executive advisor to Zico supporting the transition and long-term strategic initiatives." It amounts to part-time consulting role for unspecified period of time, most likely a year. Longtime Coke exec Scott Uzzell steps up to prexy and day-to-day mgmt of co after having served over past year as chief commercial officer and evp sales. His move to that post from VEB had been viewed as step toward putting one of Coke's own at helm, tho as noted, KO had left choice to Rampolla's discretion and he'd interviewed others within and outside KO system. During year-long trial run at Zico, tho, Uzzell proved natural fit and commanded great respect from troops, Rampolla noted. Uzzell's varied experience within red system has included vp of McDonald's biz unit and vp/gm for incubation at VEB, where he helped oversee brands like Zico, Honest Tea and Illy Issimo. Zico will now seek sales leader to succeed Uzzell, most likely from within KO ranks, and likely will install more finance people. But key members of Rampolla's team in marketing and operations remain in place. Recall that VEB took minority stake in 09, moved to majority ownership last year and rolled out brand onto Coke trucks in almost all US and Canadian markets. Asked about his priorities coming in to top post, Scott offered no comment beyond enthusiastic holiday greeting. Cos have not disclosed terms of transaction.

Rampolla allowed that, thanks to aggressive investment, rival Vita Coco has done well for itself. "They invested very heavily, went national before my brand, and continue to spend and resource very heavily. But I don't know how those economics play out for them over the long term," he said. By contrast, Zico "sees some benefit and logic to patience and discipline. It's a marathon and we're in the very early stages" - not the beginning of the end, but the end of the beginning, Mark said, paraphrasing Churchill. "There's a tremendous amount of runway in the coconut water category and I absolutely believe Zico can still lead it."

As part of deliberate expansion, Zico chose to wait before entering big-box stores like Walmart while Vita Coco didn't. To surprise of many in biz, Vita Coco's Walmart gamble paid off, and Zico had to suffer further indignity of retailer re-entering scanner database, with result that Zico's measured share immediately plummeted by 4 points or more. Brand was quick to enter Walmart after that, and apparently has performed well there, at time retailer is making concerted health & wellness push. As for gamble Zico did take - going with from-concentrate liquid in PET bottle - skeptics' predictions that move would undermine coconut water's fresh-from-coconut positioning didn't pan out, tho it's possible taste challenge associated with entry may have been issue. To date, neither Vita Coco nor ONE have imitated move. Bottle might have been a little ahead of its time, Rampolla acknowledged, but it's now more than half Zico's total biz and is key element in taking category mainstream. He wouldn't comment on tradeoff between presence in Trader Joe's and Whole Foods, beyond saying, "I have an enormous amount of respect for Whole Foods and they definitely played an important role in helping us to build the brand. But in past years we have not had the close relationship we would have liked to, and I hope over the years we can improve that."

Rampolla Reflects: Slow and Steady Builds Momentum Taking moment to reflect on 9-yr Zico run to date, former Int'l Paper exec said key piece of learning in running early-stage brand was recognizing importance of momentum, which becomes self-perpetuating, in contrast to chasing spikes in distribution or sales and having to navigate accompanying plateaus or dips. Point of pride: even in early days, when brand struggled and Rampolla wasn't assured of making his mortgage payment, he always found way to make payroll. As for next stage of his life, once handoff is complete in coming year or 2, Mark said he won't make any commitments for at least a year. He won't need to work again, and he and his wife plan to give plenty of thought to devising meaningful plan going forward, he said. That plan will not necessarily include a bev launch, he emphasized.  

After trying out proposition in lemon-tea mecca NY, Honest Tea is taking its unsweetened Unsweet Lemon Tea national. Item is brewed with certified organic tea from India and flavored with organic lemon extract; as plastic-bottle entry it goes mainly on trucks of Honest Tea owner Coca-Cola rather than thru natural channel. "We worked hard to create an unsweetened tea with a smooth and easily accessible taste profile that Unsweet Lemon Tea delivers," declared cofounder/ceo Seth Goldman. Unsweetened bev category is up 34% over past year, co noted, citing scanner data . . . Tim Redmond, a Detroit-based sales vet at Glaceau and FRS, has signed on as vp at Body Armor, whose sales chief John Kenneally departed several months ago . . . Ferrarelle sparkling mineral water has taken another step toward broadening availability by signing up home/office delivery giant DS Waters of America on national basis. DS, which services 1.4 mil customers, will add 330-ml and 750-ml bottles of Italian import to its portfolio of regional bottled water brands. Ferrarelle had previously signed with specialty food/bev importer Atalanta Corp as brand's exclusive importer . . . Cheney Bros, major foodservice operation in Southeast, has picked up Mountain Valley Spring Water. Cheney, which operates out of Riviera Beach, Fla, ranks as 11th-largest foodservice house.  

Finest Kind Tea Concentrate is hoping to score in contest launched by FreshDirect online grocer and RocketHub crowdfunding platform called Next BIG Food Thing that launched this week. Here's how it works, per Jay Lombard, who created cold-brewed iced tea brand: Contest is crowdfunding project, but amount raised is only 20% of overall score used by judges to determine winner, who receives $10K and chance to partner with FreshDirect. Some 60% is based on overall quality of idea and final 20% is audience interaction (that elusive "buzz" factor). (Link can be found here: http://bit.ly/1deA256 .) "It's an incredible opportunity for exposure for the product plus the potential to raise a significant amount of capital," says Lombard. He's vying with cos offering non-bev propositions like "kitchen kits for apartment-size pickling" and multigrain Colombian-style arepas. Note that Finest Kind was first intro'd to BBI readers under Maine Original Tea name, which Lombard says he dropped mainly (Mainely?) for trademark reasons . . . Elsewhere in burgeoning crowdfunding universe, at site called Plum Alley, VROU vitamin-infused line targeting women has hit its Nov 30 goal of $30K and is trying over next week to pull in additional $10K. Contributors in varying amounts are offered likes of branded American Apparel tanks, Lole yoga pants and chances to serve on "executive tasting team" determining future flavors. Two backers ponied up $5K apiece for year's supply of product and 2 tix to any mainland LPGA tournament. Brand was launched in NY by pair of former college athletes, one female, one male. Purely by coincidence, BBI first encountered both Maine Original and VROU brands this summer at NY Foodies Group meeting (BBI, Aug 16).  

Green Mountain Coffee Roasters said revenues surged 22% to $1.05 bil in 4th qtr while profits jumped 38% to $127 mil. Gains "were driving by robust brewer sales and continued portion-pack sales momentum," said prexy/ceo Brian Kelley. For full yr, revs rose 16% to $4.4 bil. GMCR reported that sales of Keurig brewers increased 15% to 9.8 mil units sold in fiscal 2013, while it sold 8.3 bil portion packs during yr, up 26% from 6.6 bil in 2012. Local paper noted portion pack disclosure was "a somewhat surprising revelation" given co's reluctance in past to disclose that figure.  

We went to press recently with pair of quick stories indicating first that Bai Antioxidant Infusions brand seemed to be migrating to Dr Pepper Snapple Group network in Southern Calif and then announcing that DPS in fact has become national distribution partner to Bai Brands (BBI, Nov 15 and 19). Our efforts to connect with Bai founder Ben Weiss didn't work out in time for either of those stories, but we spent some time on line with Ben today for added perspective, and a look back at 4-year run of brand that first caught BBI's eye for its ability to offer low-calorie stevia subline that actually tasted good (BBI, Jan 29 2010). Other distinction is that brand uses coffee fruit (not bean), antioxidant-rich component that's usually discarded by growers. By now, once-core full-calorie core line has been dropped so that stevia-based Bai-5 5-calorie line now is the horse. At time we heard rumblings about SoCal migration, Bai already was ensconced in DPS-owned bottling operations in Texas, NY, Northern Calif and Chicago, along with key indie DPS houses like Honickman Group in Mid-Atlantic and Polar in New England, so broader participation doesn't come as huge shock. But it's still milestone for brand, and maybe for DPS co that's been spooked by how steep erosion has been lately on core CSD side.

Deal Dynamics: No Equity, Likely Migration into All DPS-Owned Territories As with other national partners of DPS, Fiji Water and Vita Coco coconut water, there's no equity investment tied to this deal, Weiss said. In fact, it wasn't even discussed as part of negotiation, he said. DPS announcement that it would take brand into "most" territory meant that it aspires to pick up brand in all its company-owned operations, Ben explained. (In some parts of US it moves thru indie houses, as with Polar in New England.) As for Southern Calif, Ben confirmed that indie DSD house Haralambos Beverage is being terminated in LA but declined to comment on status of another key house in region, Lenore in San Diego, saying Bai does have latitude to retain indie houses in any territory where they're deemed best option. That said, brand's 2 years of success in co's NY operation means Bai is road-tested within DPS. "It's not like they're taking a chance on us," he said.

Background: No Landgrab; Glaceau's Oza, Celebs Stay in Background Weiss took pains to note that, while brand has made lotsa noise in retail banners where it chose to play in regions where it has DSD presence, it has not succumbed to landgrab approach. Brand is only now seeking to enlist DSD partners in such major markets as Pacific Northwest and Ariz, and still hasn't entered any national retail chains, he emphasized. Rather, co has followed post-Vitaminwater playbook of going deep in territories and channels where it does play. "We operate from the point of view that this be sustainable, and not fall into all the booby traps out there," Weiss said. Co has hit $20 mil in sales "in stealth mode," he said. It currently employs 60 full-timers and 300 brand ambassadors. Key investor has been former Glaceau marketer Rohan Oza, but he's stayed in valued but strictly advisory role. Array of celebs have also invested, but they too keep in background, Weiss said, "because that's not who we are." That's contrast, of course, with lotsa other brands out there like Vita Coco, Zico and Body Armor that make as much hay as they can out of famous friends.

Positioning: Downplaying Coffeefruit Presence, Staying 'Authentic' Consumers seem to view "antioxidant infusions" as healthy in generalized way, and are attracted to natural formulation, low sugar count (1 g) and approachable price point. One key, Weiss noted, is that co has never made too much of coffeefruit content, figuring it would add confusion with lotsa other brand messages to convey. "Genius move, because I basically dumbed it down," Weiss says, looking back. Tho brand resonates with female-skewing "healthy aspirationalists," fact that so many millennials are target means that marketing must be kept straightforward and "authentic." Thus, no effort to flog celebs in its circle, or any overt marketing so far beyond in-store sampling. Dialed-up fruit imagery on front panel - a rarity in enhanced-water set where Bai mainly plays - seems to have prompted lotsa trial. Moving more heartily into CSD network and national scale-up thus is risk, Weiss acknowledged. Navigating that is key mandate for co's agency of 6 months, SapientNitro. It's also probably time to start taking "deeper dive" into coffeefruit as differentiator, Weiss said. Overall, "I'm extremely confident that this proposition delivers," he said, lapsing into Bai-speak: "I'm the ultimate Bai-liever."  

Remember that we posted some Nielsen scanner data a week ago with worrisome-seeming trend for energy category, only to have to retract it when it proved data was corrupted? (Well, we'd prefer you not remember!) Revised Nielsens for convenience stores for 4 wks thru Oct 26 show different picture more in line with what folks have observed in market. Monster sales were up 10.4% vs previously reported 0.4% gain, reported Goldman Sachs' Judy Hong. Red Bull slowed to still-healthy 7.9% gain (vs 13.5% gain a yr ago) while Rockstar jumped 15.4% going vs easy comp (1.1% from a yr ago). Overall energy segment was up 7.9% for latest 4 wks, an improvement over 7.2% gain prior month but down from 14% gain for same period in 2012. That said, it's not all rosy. "Pricing looks soft, with all top 3 players showing negative pricing" over last 2 mos, noted Judy. Avg price for energy drinks dropped 2.9% last 4 wks following decreases of 2.2% and 1.6% in Sep and Aug. Rockstar avg prices were down 4.4% last 4 wks, while Monster and Red Bull decreased 3.3% and 2.6% respectively.