Teas’ Tea marketer Ito En has finally taken plunge into decaf sector, offering caffeine-free versions of its unsweetened bottled green and black teas at recent Natural Products Expo East.  Line offered in Teas’ Teas’ distinctive square-shaped half-liter PET bottles maintain clean, pure taste of core line, as process does not require acidification, noted sales chief Jim Hoagland.  Co also is expanding its well-received Latte line with Chai Tea Latte blending cardamom, ginger root, black pepper, cloves and cinnamon for spice blend.  Like existing latte flavors, Black Tea Latte and Matcha Green Tea Latte, item is created with skim milk to offer lower calorie count, at 80 calories per serving.  With summer selling season over, initial focus will be on NY metro, strong market for Ito En brands where co maintains its own distribution network.  And given compelling social-media feedback indicating that many consumers have been adding sugar to their unsweetened Teas’ Tea drinks, co now is offering sweetened versions of its Green Tea and Jasmine Green Tea mainstays, at 120 calories per bottle.  That continues evolution of Japanese co that once prided itself on making few concessions to Americans’ sweet tooth, in interest of preserving teas’ vibrant flavor and purity. 

Flipside is that co has been able to dramatically broaden its retail presence, including to conventional groceries.  That had prompted West Coast test of 4-packs that now will be rolled out nationally in co’s top 2 flavors, Pure Green Tea and Jasmine Green Tea.  The multipacks will generally go out at $5.49 at retailers like Target, promoted down to $4.99, vs SRP of $1.99 for individual half-liter bottles. 

After new ceo Dave Racicot inaugurated period of consolidation in order to put biz on more financially sustainable footing, Mercy Nutraceuticals is gearing up once more, adding 2d flavor in core hangover-preventive line, prepping new subline dubbed Restore and expanding geographic reach.  With greater emphasis on margin, co also has backed away from resource-sapping nightclub scene and, outside of legacy markets like NY and Fla, is pricing 8-oz cans at $2.99 rather than $2.49.

With distributors clamoring for 2d flavor to augment their quest for retail shelf space, co is launching Blood Orange sku to complement core Citrus flavor.  That offers on-trend, mixable flavor with elegant connotations, Dave told BBI in discussion this week.  It launched on Amazon.com, then moved into Fla distributor Brown Distributing and was served at last week’s Natl Beer Wholesalers Assn trade show as co seeks broader presence.  It’s also launched parallel line called Restore after repeat consumers indicated they were taking core Mercy line for functions other than hangover prevention.  It contains glutathione and blend of lemongrass, ginger and citrus, in tan can.

New developments come after Racicot, a former Coca-Cola NY and spirits exec, arrived talking of continued aggressive expansion only to quickly reverse himself and move into period of cutbacks that saw departure of sales team assembled by new-age vet Marty Jay Zirofsky as well as marketing exec Todd Fletcher, former Red Bull exec.  Dave told BBI he’s handling those roles himself for now.  Among staffers who’ve remained in place are Gerard Palacios, managing international expansion.  Australia likely will launch soon, and other parts of Asia.  Tho brand boasts impressive roster of investors, including MTV founder Bob Pittman and actress Gwyneth Paltrow, Racicot needed to ease burn rate.  Tho he wouldn’t disclose specific $$ data, he said sales have been growing by 30% and bottom line at higher rate than that in recent months.

Under Racicot, co is being more selective about DSD expansion and accompanying need to put feet on street, going with blend of DSD in focus markets and alternatives elsewhere – as with signing this week of Dolce Beverage Group to distribute brand in 14 Midwestern markets, via mix of self-distribution in Chicago, A-B wholesalers in Mich, Pepsi bottlers in Minn, MillerCoors houses in Ind, and the like.  Move allows Mercy to ship pallets to Dolce and leverage its feet on street rather than add to its own staff burden, Racicot said.  But co continues DSD emphasis in key markets like NY (where brand moves via Phoenix Beehive), Fla (Brown), Atlanta and Calif.

Also out of mix, at least for now, is involvement in nightclub scene as logical place to build awareness of anti-hangover line.  “Prohibitively expensive,” explained Racicot, who said Mercy now is targeting hotels and resorts instead, such as W Hotels in Chicago.

Anti-GMO forces are viewing several upcoming battles at the state level – particularly Wash State – as crucial to generating momentum that might result in federal legislation requiring labeling of foods/bevs that employ genetically modified ingredients.  That was key message that came thru at Fri morning panel at Baltimore Convention Center, even as adjoining show floors of Natural Products Expo East displayed increasing signs that natural-products purveyors are responding to issue on their packaging and in their consumer and retailer communications.

“The way to get federal legislation is through the states,” declared panel moderator Steve Hoffman, dir of Compass Natural and a key member of Yes on 522 Campaign in Wash State.  “We don’t want to lose twice on the West Coast,” he added, in reference to deflating loss in Calif 2 years ago of Proposition 37 at hands of massive media blitz by big food and bevcos.  “We know we’re going to be outspent” in Wash State but still believe victory is within reach when 3-week voting cycle begins in coupla weeks, he said.  He later noted to partisan crowd that 64 countries have passed GMO legislation by now, including likes of Russia, China and Syria.

All told, 26 states are considering initiatives in coming year, panelists noted, and that’s getting attention of FDA and Dept of Health & Human Services, noted Elizabeth Kucinich, Washington lobbyist who’s dir of policy at Center for Food Safety and exec producer of much buzzed-about documentary GMO OMG.  (She’s also wife of former Ohio congressman Dennis Kucinich, who was in audience and also addressed some of issues.)  On flip side, food/bev and chemical giants like Monsanto recognize threat and are taking steps to preempt the states, with major bill expected to drop in Congress in coming weeks.  There was some debate about whether that might have a chance of derailing anti-GMO momentum, given how GMOs are rapidly becoming hot-button issue that – like immigration and guns – quickly draw tens of thousands of calls and emails to politicians, noted Hoffman.  “I would be very surprised if a single Democrat” supported such a bill when it drops, he added, and Dem majority in Senate should serve as a “firewall” against its passage there.

Washington State Effort Uses ‘Trusted Messengers,’ Humorous Tone   In next key battleground, David Bronner, ceo of Dr Bronner’s and finance chair of Yes on 522, described efforts to overcome anticipated media blitz by pro-GMO forces, including hiring of political team that successfully passed gay-marriage bill, recruitment of corps of 5K volunteers to man phone banks, and endorsements won from influential groups like Wash Nurses Assn.  Yes on 522 and its allies have assembled 10 focus-group-tested ads and amassed $4.4 mil in funding – about 1/3 what anti’s currently have – with another $1 mil promised and efforts under way to pick up another $800K.  Ads employ “trusted messengers” like farmers and moms to get message across, and humorous touches like Pike Market fishmonger tossing fish to startled mom, to get $$ to work better than those of so-far-stilted ads of anti-522 forces.  To counter key but unsubstantiated argument of anti’s – that relabeling products will add $500 to each family’s annual food costs – ads assure viewers, “It won’t cost you a dime.”  Tho anti-GMO advocates feel they can make a case on safety and science grounds, this time they’re focusing message on consumers’ right to know and transparency, simpler messages that are likely to resonate with libertarian-oriented voters in Wash, noted Delana Jones, campaign mgr for Yes on 522. 

Of course, big cos have also refined their strategy, and if sentiment seems to be trending against them, always are capable of landing last-minute funding windfall as they did in Calif to intensify media barrage.  One key bit of learning: to avoid backlash suffered by cos like Coca-Cola that contributed to anti-Prop-37 campaign in Calif, this time they’re funneling donations thru Grocery Mfrs Assn to make it less likely that individual brands are singled out in consumer backlash.

On Show Floor, Increasing Prominence to Issue, but Some Bridle at Cost, Complexity; Reed: Too Many ‘Lawyer Parasites’ Involved    Among bev exhibitors on Expo East show floor, there were abundant signs that they’re feeling this is issue they need to be outspoken on.  As recently reported, Reed’s Inc plans to promote its ginger brews and root beers as GMO-free.  Cold-press juice maker Suja is donating 20 cents per bottle of its Berryoxidant flavor of Elements subline to support GMO labeling initiative and Brands Within Reach will certify its products as non-GMO, starting with its Youthy smoothie line.  But some were bridling at what they said were steep costs and complexity of process, among them Blue Monkey Coconut Water ceo Simon Ginsberg and Reed’s own Chris Reed, who said his co will self-certify for now.  Describing encounters with GMO certifying org whose price seemed to leapfrog depending on whom he was speaking to, Reed denounced issue as “creating an industry of lawyer parasites.  It’s the wrong way to go about it.  We don’t need an agency for it.  We already have a legal system,” with threat of class action suits minimizing chance cos will lie about their GMO status.

Crystal Geyser Water Co, Calistoga, Calif, has acquired 145K-sq-ft bottling plant sited on 266 acres in Mt Shasta, Calif, as it gears up capacity to  serve domestic and Japanese customers.  “This site was selected for its pristine water source, and the ability to expand production as our distribution and sales volumes increase,” said evp Richard Weklych.  “Our protected spring is fed from the Shasta-Trinity National Forest watershed, at the foot of Mt Shasta, which climbs to 14,179 feet above sea level” . . . Icelandic Water Holdings is bringing its Icelandic Glacial bottled waters to Netherlands via multi-year distribution partnership with M&F Liquor, a leading importer and distributor of organic wines and premium bevs.  

It’s not co you necessarily expect to find at natural-foods extravaganza like Expo East.  But with acquisition of Fizzy Lizzy and launch of its own stevia-sweetened, zero-calorie soda, venerable White Rock Beverage Co has added 2 natural legs to brand stool and is looking to broaden geographic presence.  At Natural Products Expo East, co had recruited Fizzy Lizzy founder Liz Morrill to serve as face of brand, even tho she no longer has operating role on brand, as co preps reskinning of package.  At same time, Whitestone, NY, co is finally ready to launch stevia soda under Psyche brand – the name’s a reference to nymph-like “goddess of purity” on classic White Rock seltzers – in Cola, Root Beer, Lemon Lime Soda and Orange Soda flavors.  Sweetened with blend of erythritol and stevia, new line is going out in 6-packs of 12-oz cans at $4.99 (promoted at $3.99), with Northeast and Southeast regions the initial target, said White Rock prexy Larry Bodkin.  Nor are the co’s core seltzers irrelevant to mix: Larry told BBI he’s been pleasantly surprised at how well they’ve done in expanding beyond core NY/Mid-Atlantic market to Southeast and parts of Midwest.  

With ranks of stevia-sweetened, zero-calorie canned natural sodas have grown in recent years, new player Veri is taking mid-calorie approach, offering organic sodas that don’t compromise on taste at tradeoff of 60 calories per 12-oz can.  It will go out at $4.49-4.99 per 4-pack.  Veri Soda made its debut at Expo East in familiar Cola, Orange, Lemon-Lime and Ginger Ale flavors, flagged prominently on front of can as “organic & low-calorie.”  Line uses blend of organic cane sugar, stevia and fruit juice to obtain robust flavor, said founder Zeger Van Havell, former commodity trader who took interest in devising healthier soda when his wife became pregnant with their first child 7 years ago and who’s spent 4 years developing co’s own flavor system rather than purchasing one off-shelf from flavor house.  He bought lemonade plant in Amsterdam to give it a go, only to realize that organic stevia isn’t allowed in Europe, so he’s switched his sights to US and just signed on UNFI and Kehe as distribors.  Zeger is currently based in NY but plans relo to DC in coming months as his partner and his family rejoin him.  Brand name Veri derives from Latin “veritas,” for “truth.”  Can graphics can be viewed at placeholder Web site VeriSoda.com.  In conventional CSDs, of course, mid-calorie sodas have proved tough sell in US, but Van Havell figures more-sophisticated organically oriented consumers will be open to proposition.

After tests in markets like LA and Austin, Gaba-based Zenify stress reliever enjoyed formal launch at Expo East, with LegalZoom chmn/co-founder Brian Liu, who helped create brand, now having segued to full-time role as ceo.  Canned item being sampled at Expo East bore signs of extensive rethinking since test: consumers had responded well to taste, Brian reported, but revealed confusion over brand intent, so it’s now prominently branded as “natural stress relief.”  It previously exhorted, “Stay calm, sharp & focused” (BBI, Nov 5).  (Stress relief derives from blend of L-Theanine, glycine and gamma aminobutyric acid, or Gaba, amino acid that got its most prominent test, ultimately unsuccessfully, via Jones Gaba launch of Jones Soda a few years ago.)  To get Non-GMO seal on can, co sourced cane-sugar-based fructose from Europe, twinned with bit of stevia to bring calorie count in at 50 per can.  It’s also got cool packaging fillip: it’s first 12-oz can to employ tactile sleek can from Rexam, employing new skin technology that Monster Energy has used to great effect on 16-oz cans of Zero Ultra.  And co has lined up cause-marketing partner: Coexist Foundation, for whom it’s first corporate partner.  That’s a good fit because Coexist, which has worked with likes of Bono, aims to foster world without stress, tension and conflict, as sell sheet notes.  Brand will donate 5% of profits to cause.  Zenify goes out to distributors at delivered cost of $12 per 12-unit case and hits shelves at SRP of $1.99, for margin of 46%, per sell sheet distributed at booth.  Brand info at ZenifyDrinks.com.

Trying to crack energy drink market and challenge marketing budgets of likes of Red Bull and Monster is obviously a daunting task.  Some upstarts, like Vemma’s Verve brand, go directly to key consumer group, college students, but some of those students and consumer groups are now questioning the payoff, reported NY Post.  Verve “is 2 years into a marketing plan that focuses on young people selling” the brand, and while hardly the first direct seller to enlist scholars, “its marketing strategy of trashing college as a pathway to success may be,” noted Post.  Founder Benson K Boreyko “uses fancy cars like BMWs and Mercedes to lure students,” as top salesmen arrive in gleaming cars to pitch undergrads.  “College doesn’t guarantee you anything but student loans,” 23-year-old salesman Alex Morton was quoted during recruiting drive posted on YouTube.  “You can be driving a new BMW within 90 days.”  But a review of Vemma’s financials found that 75% of salespeople “make under $1,327 per year,” noted report.  Students at several universities have shared their own stories of losing money while working for Verve because they could not meet recruiting requirements to net a commission and earn back their own investment.  “Vemma’s success also has sharpened the focus of consumer groups on its practices,” added Post, noting co’s heavy emphasis on recruiting” has groups using “pyramid” word.  “Don’t call us a frickin’ pyramid scheme because we’re not,” shot back Boreyko.    

Stakool Inc is putting its moniker where its mouth is: it’s changing its name to Fresh Promise Foods to reflect big bet it’s placing on high-pressure processing as route to $30 mil in annual revenues.  As reported, STKOD ceo Kevin Quirk, in since May, has said he’s due diligence phase of negotiation to acquire unidentified HPP processor, deal that co now says is expected to close on or before Nov 1, and develop twin businesses as processor for other brands and building its own consumer products.  In recent shareholder letter, Quirk said he’s “confident that processing revenues alone will achieve an annual revenue rate of $30 million” as existing HPP marketers broaden their lines and new customers come in.  His team has further identified another $10-mil-plus “simply by processing for companies who are currently using HPP at facilities that are not geographically beneficial to them.”  Imminent deal is described as involving “primary” target and Quirk has indicated Stakool is pursuing other acquisition targets too.  New ticker symbol hasn’t been determined yet.  STKOD is based in Jacksonville, Fla, tho Kevin is expected to relocate it at some point to his Atlanta base.

Under leadership of exec who started out humbly as Pepperidge Farm route driver, Campbell Soup is continuing to sign DSD houses for its V8 brands, and in some cases also assigning Bolthouse Farms items to distributors with refrigerated capability.  These are among additional details to emerge of soup maker’s DSD plans behind its V8 family of brands as it preps Jan 1 break from its distribution partner of 5+ years, Coca-Cola.  That effort came into clear when NY house Big Geyser signed on for V8 brand (BBI, Sep 25), but word is that familiar DSD houses like Buckeye in Ohio also have come aboard and discussions are under way across extensive parts of US, particularly on both coasts and across Sun Belt.  Wholesalers report that Camden, NJ-based CPB is promising significant support, and is believed already to have recruited couple of dozen staffers to support its reconstituted DSD network.  In some lower-priority areas, mainly in heartland, CPB is going with broadliners like McLane and Eby-Brown, perhaps buttressed by DSD houses in more limited role.

Tho effort began back in spring, it’s now being run by newly appointed vp of immediate consumption Kyle Jordan, who just segued from Pepperidge Farm side of CPB.  Iona College grad Jordan has unusual background that saw him start as Pepperidge Farm route owner, at co called Stars & Stripes in NY area, before co bought out his route in late 90s and put him on mgmt track, where he’s apparently thrived.  Tho that was on bakery side, Kyle’s background presumes level of comfort and sophistication in dealings with DSD houses, particularly those, like Geyser, that maintain cadre of indie route owners.  That’s often proved not to be the case when big warehouse-oriented cos like Kraft or Abbott Labs have tried to crack DSD space.  Also among brain trust on DSD push are Mike Barkley, vp/gm of bevs unit, and vp external development Roger Wilson.  Some of execs associated with Coke alliance apparently have moved on, as partnership frayed over such issues as in-store execution by Coca-Cola Refreshments and Coke’s own increasing wariness of CPB as a partner after soup maker acquired Bolthouse Farms, a direct rival to KO’s Odwalla, and extended V8 into more refreshment-oriented juice segments that were seen as impinging on KO brands like Minute Maid.

So far, CPB appears to be taking eclectic view of DSD biz, approaching not just conventional beer and NA houses but dairy and ice cream shops, particularly in markets like Tex and Fla where conventional DSD options are limited.  Thus, co has signed with ice cream distributor Yumi in Tex and dairy Sunny Dairy in Fla.  Since both have refrigerated systems, they’re each taking on not just shelf-stable V8 but also Bolthouse Farms, an intriguing move that could dramatically bolster Bolthouse’s presence in immediate-consumption channels.  Recall that independently operating brand earlier signed with Core-Mark to crack c-stores (BBI, Jul 23).