Single Serves Grow, Drink Mixes Reach $1 Billion

OCTOBER 31, 2008 POWDERPOWER Single Serves Grow, Drink Mixes Reach $1 Billion

ALSO THIS ISSUE: MAGIC HAT BREWERY DIET ENERGY BOUTIQUE CSDs RTD JUICE

OCTOBER 2008 vol. 6 :: no. 7 cover story 30 Powder Power Single serve drink mixes measure proﬁ t by the square inch features 24 We Already HAD a V8 How the world’s best known veggie drink became fruitful 28 Brands in Transition Another trick for Magic Hat columns 8 6 First Drop Saving time online 8 Publishers Toast Take a deep breath 22 Gerry’s Insights Marginal difference departments 10 Bevscape Business BPA debate back again 12 Bevscape Innovation Pepsi banks on 8-packs 14 Channel Check Spotlighting teas 18 New Products 24 Say hello to Michelob 48 Promo Parade With hoiday coverage category focus 36 Boutique Sodas Embracing function 40 Juice and Juice Drinks The economy and premium products 44 Diet Energy So very necessary conference beat 46 Review NACS Show 30

Beverage Spectrum (Postal Number 024-552) is published monthly with combined issues in January/February, May/June, July/August and November/December by Beverage Spectrum Publishing, Inc., a wholly owned subsidiary of BevNET.com, Inc. One Miffl in Place, 3rd Floor, Cambridge, MA 02138. Periodicals postage paid at Boston, MA and additional mailing offi ces. POSTMASTER: Please send address changes to Beverage Spectrum Magazine, Subscriber Services, One Miffl in Place 3rd Floor, Cambridge, MA 02138-9917. OCT.08.BEVERAGESPECTRUM.5

THE FIRST DROP By Jeffrey Klineman

THE INTERNET: GET IT?

THERE’S A LOT of discussion these days about whether various people or companies “get” the Internet. This is not a major concern for us at Beverage Spec- ÊUÊÌiÀiÌÊ>«Ê>ÃÊvÊ trum, as we, in fact, are creatures “of” January 16, 2006. the Internet. We don’t so much get it as are gotten by it, are glued to it, spend half our time lost in it, and enjoy forwarding amusing things back and forth that we have found in it. orbiting around every trend or niche interest duced a lot of the environmental zeitgeist. They say write about what you know, and one can think of, from the best cheeseburger You can’t beat them. Join them. Start selling it’s with this in mind that I tell you I know in Omaha to the various kinds of men who your environmental initiatives online. the Internet. Or, at least, the various news look like Kenny Rogers. and product sites I patrol hourly. Here’s the With so much to absorb – and so many 3 . As part of 2, remember – the Internet thing I get about the Internet: online, there misspelled captions laid over photos of cats is the home of the “Master Debunker.” The is a justifi cation or rationalization for every – it’s easy to take your eye off the ball when Master Debunker is a semi-journalistic, single thing written, recorded, or argued, it comes to harnessing the Internet for the semi-consumerist blogger or organization and there are a lot of t-shirts for sale. purpose of making and selling beverages. To who will fi nd out what is in your product, The idea that so much of our time is now spare you the trouble of having to “get” the what claims you make are truthful, and spent online does offer a wide variety of Internet, however, these are some observa- where to get it for cheap. Do not try to lie opportunities for beverage companies and tions that, having bothered to read this far, to the Master Debunker. They will leave you retailers to have an impact. For example, you should download to your own personal naked and hurting, with all your calories and knowing my wife was headed up to tax-free knowledge base: additives hanging in the wind. Look at the New Hampshire (New Hampshire having up-and-down fate of “All-Natural” 7-Up for voted long ago to offi cially change its state 1 . The niches of common interest that a clue to that. name to “Tax Free New Hampshire), I form on the Internet are the same kinds of hopped on the New Hampshire State Liquor groups that can sustain a product. Bawls is 4 . Just because something is an Internet Store web site to fi nd out what cheap cases an example of a product line that has found fad, that doesn’t mean it’s going to translate of red wine were available at their 77 loca- a variety of different, marketable niches into a good beverage. The better move is tions. It seems to me that this should be a rather than a broad, one-size-fi ts-all market- to understand what the fad represents: the fairly easy trick for chain stores to imple- ing strategy. If you’re launching or selling a answer to a question asked by Internet users. ment, particularly given the amount of work new product, go for the right niche. Jones Soda did this well for years –using the they are currently putting into category Web to let users express their individuality. management. 2 . Environmental awareness is not going There’s also a lot of knowledge and away, and bloggers, activists and nonprofi ts 5. When all else fails, post a photo of opinion available online. While a lot of that who fi nd equal footing for their messages a cat enjoying your product. Make sure to is political, there’s also a galaxy of sites with marketers and manufacturers have pro- misspell everything the cat says.

6.BEVERAGESPECTRUM.OCT.08 a10tion calorie counting shoppers! we hate to twist our own caps, but we just did the unthinkable to low-calorie!

sonly 10 calories per serving sgreat tasting (trust us, it can be done) spacked with vitamins and nutrients

available in 20oz. singles and 16oz. 4 packs.

low cal PUBLISHER’S TOAST By Barry J. Nathanson

PUBLISHER Barry J. Nathanson [email protected]

TAKE A DEEP BREATH... EDITOR Jeffrey Klineman [email protected]

ASSOCIATE PUBLISHER John McKenna [email protected]

ART DIRECTOR Matthew Kennedy [email protected]

GRAPHIC DESIGNER Amadeu Tolentino [email protected]

ASSISTANT EDITOR Matt Casey [email protected]

PRODUCTION MANAGER Adam Stern [email protected]

JR. DESIGNER Natalie Iknaian [email protected]

SUBSCRIPTION INQUIRIES Adam Stern [email protected] 617-715-9679

ONLINE RENEWALS & CHANGES www.bevspectrum.com/subscribe OUR ECONOMY is roiled to a level not recessions and tight credit before, and have seen since the Great Depression. The roller always come out of it. ARTICLE REPRINTS coaster of the Dow Jones and the collapse What does this have to do with beverages? (500 copies or more) of several once-esteemed fi nancial institu- Everything. This is not a time for marketers, FosteReprints 800-382-0808 x142 tions have launched the anxiety meters to the retailers and distributors to go into a shell. stratosphere. The entire world’s economy is It is essential that we continue to be visible caught in this downward spiral. Our 401Ks, in the marketplace. We are blessed to be in BEVERAGE SPECTRUM IRAs, savings, and stock accounts are evapo- an industry that the consumer both needs PUBLISHING INC. rating before our collective eyes. Nothing and wants. So look where you can trim, of CHAIRMAN seems safe or secure anymore. course, but don’t stop your initiatives. Bever- John F. (Jack) Craven Being a baby boomer born in 1948, I viv- ages are a foundation of our package goods [email protected] idly remember the conversations of my par- industry. Our brands are some of the few PRESIDENT AND ents and their peers about their lives during basic and luxury items that the public can EDITORIAL DIRECTOR the turbulent Great Depression. Years later, afford. We would send a bad signal if the John Craven their fears and angst were still very real, and shelves weren’t stocked, if the choices were [email protected] the times they talked about were truly des- diminished, and the pricing was either cut perate. But what I remember most was their drastically or raised too much. Promote your EDITORIAL faith in our system and the American way brands and keep up the marketing efforts. 1 Miffl in Place, Suite 300 of confronting dark issues and overcoming Don’t slash budgets on programs that have Cambridge, MA 02138 them. Sure, what they were discussing was worked for you for so long. Give a value ph. 617-715-9670 fax 617-715-9671 different from today’s situation. They didn’t proposition that the buyer can embrace. ADVERTISING have the safety nets, government-sponsored The market will come back, as will the 1123 Broadway, Suite 210 deposit insurance, and the immediate credit. The economy will rebound, as it New York, NY 10010 intervention that we all hope will eventu- always has. Our industry is a bellwether of ph. 212-647-0501 fax 212-647-0565 ally bring us back from the economic abyss. our economy. Make sure you’re serving the We can believe, from their experience, that, customer well, and you’ll be poised to ben- while these times are tough right now, they efi t from the turnaround. It will come. BPA Worldwide Member, June 2007 too shall pass. We’ve had economic travails,

8.BEVERAGESPECTRUM.OCT.08 Thank you for making us #1.

You’re number one, too. Thanks to our retail partners, distributors and all of America for making FIJI Water the best-selling premium bottled water in the U.S.* We’re proud to be more than just the best-tasting water, but also the top-ranking premium bottled water. Thank you for your partnership and support. FIJIWATER.COM

*Source: IRI FDMx 52 Weeks Ending 2/3/08 & IRI Convenience Stores 52 Weeks Ending 12/30/07; Volume and Dollar Sales. BEVSCAPE BUSINESS THE LATEST NEWS ON THE BRANDS YOU SELL

TRUCKING ENERGY DRINKS: A NEW GAME MORE INFO ON BOTTLED WATER?

If you’re interested in selling Monster or Rockstar, get ready to Bottled water in the U.S. could include more play a little distribution Twister in the next few months, as a set on-package documentation if a bill proposed of deals engineered by Coca-Cola North America is about to by U.S. Senator Frank Lautenberg (D-NJ) completely change the cast of characters servicing your store. becomes law. Just before Beverage Spectrum went to press, Hansen Natural The bill, called the “Bottled Water Safety Corp. and Coke announced that they had agreed to a deal where and Right-to-Know Act,” would require the soda giant would take over distribution of Monster Energy in bottled water companies to display – on each Western Europe, Canada, Mexico, and some U.S. states. bottle – where the water came from, how it The deal came just two years after Hansen entered a distribu- was treated, and the quantity of contami- tion deal with another beverage giant, Anheuser-Busch, whose nants in the bottle. network handles a little more than half of the fast-growing energy Tom Lauria, a spokesman for the Interna- brand’s wares. Most of the rest of the brand is run through a tional Bottled Water Association, said most series of independents and, more importantly, a series of distribu- bottled water companies already address tors owned by Dr Pepper Snapple Group. Those DPSU distribu- these issues. They print the source of the wa- tors, who revealed they will take a hit of close to $200 million ter on the label, he said, along with an 800 in sales with the loss of Monster, are going to collect termination number to call for more information – but fees – likely paid by Coke via Hansen – but are still going to need adding much more information to the bottle a new energy drink on the trucks. may be asking too much. Meanwhile, the announcement came just two days after “You’re trying to telegraph to the consum- Rockstar, whose brand has been fl agging a bit in recent years but er what they need to know, quickly,” he said. remains the third-ranked independent behind Monster and Red Lautenberg – whose offi ce did not return a call for com- Bull, announced the extension of its own three-year-old distribu- ment – introduced the bill at a hearing in the Environment and tion agreement with Coke. Public Works. Lauria described the hearing as calm and “sparsely Rockstar retained the right to terminate the agreement as part attended.” He expects more hearings on the subject, including of the deal – and it seems highly unlikely that Rockstar would appearances from the FDA and EPA, and said the IBWA may want to share the stage, or the truck, with its longstanding ultimately back the measure – but they will reserve judgment until archrival. At the same time, the Los Angeles-based Rockstar ap- a fi nal version of the bill is prepared. peared to have a bit of time to fi nd its own network, as Coke and Hansen are also faced with the challenge of fi guring out how to accommodate A-B – which never truly reached a saturation point BPA DEBATE BACK in terms of its Monster distribution and is still struggling to get it into on-premise accounts – while familiarizing its workforce with The debate over bisphenol-A, or BPA, resurfaced after British re- the whole Monster catalog. searchers revealed a study on the potential effects of the chemical There has been some speculation that PepsiCo – the only big on 1,455 U.S. adults. company not yet mentioned here – might make a grab for Rock- The study found that people with the highest concentrations star, as well, either with an equity piece or as a way of bolstering of the chemical (used in baby bottles and beverage can linings) its own energy portfolio. The company has managed to revamp in their urine suffered a higher rate of heart disease, diabetes and its AMP line without leaning heavily on an independent, but it liver-enzyme abnormalities, Reuters reported. still trails the other giants. In April, Canada banned the substance from use in baby The deals sent the Coke staff into a tizzy; most of its regular bottles. The U.S. Food and Drug Administration issued a draft communications staff skipped the NACS show to deal with conclusion in August that current exposure to the chemical fell the announcement, and there was a lot of adjustment of within safe levels. The administration said it would review the arrays at the last minute. new study, but still believed exposure levels to be safe. As an example, note this statement from Debbie Wetherhead, Coke’s spokesperson to the trade, made on Oct. 13 – day two of the NACS Expo: “If you were here yesterday, the display was a little different than it is today.” Chances are, retailers will be able to echo that line in the next few months. 03 07 PVC O

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HEALTH & WELLNESS CAN PEPSI EXPERIMENTS WITH COLOR BEATS ALL KILL YOUR PRODUCT 8-PACKS A new study from European food and Sure, it’s great that functional health For a long time, the 12-pack of 12 oz. cans beverage maker Danone hinted at color benefi ts are frequently associated with has been the key package for soda makers. and fl avor are often the chief infl uence food and beverages. But there is such a But in a move that is either testing innova- on whether consumers will accept new thing as too much health and wellness, tion or wallet size, PepsiCo is trying out an beverages. which may put consumers off, according 8-pack, the Tampa Bay Times reported. The journal Food Quality and Prefer- to experts. According to the story, PepsiCo’s costs have ence published the study, which placed gone up 11 percent in the past year – and intensity of color and fl avor as the domi- with CSD volumes down, pricing increases nant elements of a “sensory marketing have not let the company keep pace. approach.” Labeling and packaging take It’s an important development – while a back seat, according to the study, which health concerns were unable to force compa- measured only those four elements. nies to change package sizes, materials costs The study’s methodology involved hav- have fi nally led to reductions. Up next, 20 ing consumers look at potential improve- oz. bottles will drop into 16 and 12 oz. con- ments to a given beverage – and revealed fi gurations (At NACS, Coke was bannering that packaging size and labeling type its 16 oz./99 cent convenience store deal). were taken into account to a lesser extent PepsiCo will also try out a 1.5 L bottle for than color intensity, which was named 43 its most popular lines. percent of the time, and fl avor, which was Euromonitor’s head of global food The test is going on in about 20 percent of named 32 percent of the time. research, Lee Linthicum, recently an- the country, according to the Times. nounced that several products are thriving because they promote various health and appearance benefi ts. But watch out for too many scientifi c claims, Linthicum added. “Manufacturers are leveraging innovations in food science and making those messages known,” he told NutraIngredi- ents USA. “But at the end of the day it is still food you are talking about.” The Takeaway? Don’t Over-Medical- ize, according to Linthicum. “There is a fi ne line between too much science and consumer innovation.”

THE FLAVOMETER Global Leading Drinks Launched by Category, April – June 2008 1. Blend Rank Category % Change vs. year ago 2. Carrot 1. Fruit & fruit ﬂ avored drinks -12.9% 3. Tomato 2. Wine & wine coolers 12.8% 4. Apple 3. Tea -2.0% 5. Orange 4. Liqueurs & other alcoholic drinks 44.4% 6. Celery 5. Coffee 38.6%

6. Lemon 6. Milk, non-dairy milk & yogurt drinks -20.8%

6. Pumpkin 7. Beverage mixes & ﬂ avorings -1.6%

9. Lettuce 8. Soft drinks 13.3% Vegetable Flavored Drinks: 9. Spinach Top Flavors in New Products, 9. Isotonic, energy producing beverages 47.6% June 2007 – June 2008 10. Beer & ale 74.2%

SOURCE: PRODUCTSCAN ONLINE (www.productscan.com) SOURCE: PRODUCTSCAN ONLINE (www.productscan.com)

12.BEVERAGESPECTRUM.OCT.08

Channel Check october 2008

RTD TEA Dollar Sales Change vs. year earlier SPOTLIGHT CATEGORY AriZona $298,831,300 5.2% Lipton $239,111,000 1.2% RTD TEA Snapple $125,630,600 -5.5% Lipton Brisk $84,087,370 -4.0% 52 Weeks through 9/7/08 Diet Snapple $77,787,710 -7.7% Nestea $63,093,040 -7.1% AriZona continues to lead the segment as an individual brand, but Lipton’s Lipton Diet $52,384,120 27.8% aggregate sales outclass the category. Lipton Pureleaf $36,153,390 170.7% The big performer of the month, Lipton Private Label $24,567,850 33.4% Pureleaf, probably owes its triple-digit growth to its recent introduction (it’s Nestea Diet $17,774,310 0.9% up only one tenth of one percent over Lipton Iced Tea $16,321,160 -53.0% last month), but the sub-line’s twist Nestea Enviga $15,378,710 -40.5% on tea authenticity still snared $36 million for Pepsi over the last year. Gold Peak $13,128,280 34.8% In the mean time, private label teas SoBe $10,711,260 -20.7% continued to perform, while Snapple Tradewinds $8,780,738 58.9% slid and Nestea plunged. Heading Up: Lipton Pureleaf SOURCE: Information Resources Inc. Total food/drug/mass excluding Wal-Mart

BOTTLED WATER ENERGY DRINKS $5,159,143,000 $886,901,400 1.1% 13.5%

TOPLINE CATEGORY BEER SPORTS DRINKS VOLUME $7,737,549,000 $1,713,134,000 52 Weeks through 9/7/2008 3.7% 2.3%

BOTTLED JUICES TEA/COFFEE $3,808,174,000 $1,415,107,000 1.0% 1.0%

SOURCE: Information Resources Inc. Total food/drug/mass excluding Wal-Mart

14.BEVERAGESPECTRUM.OCT.08

Channel Check october 2008

SPORTS DRINKS Dollar Sales Change vs. year earlier Gatorade $600,151,100 -8.5% Powerade $243,004,900 1.1% Gatorade All Stars $131,878,700 4.1% Gatorade Frost $130,128,800 -8.1% Gatorade G2 $124,347,200 N/A Gatorade Rain $119,901,200 -20.3% Gatorade Fierce $70,977,290 -23.4% Gatorade X Factor $58,766,830 -31.1% Gatorade AM $55,530,080 5.6% Gatorade Tiger $48,981,160 N/A

Heading Up: Gatorade G2 52 Weeks through 9/7/08 SOURCE: Information Resources Inc. Total food/drug/mass excluding Wal-Mart

RTD COFFEE Dollar Sales Change vs. year earlier Frappuccino $190,754,900 4.0% Doubleshot $24,523,050 -7.5% Doubleshot Light $10,461,850 -3.1% Starbucks Cappucino $9,475,734 -29.7% Bolthouse Farms $4,656,019 3.2% Godiva Belgian Blends $4,376,248 -56.3% Private Label $2,089,993 103.6% Cinnabon $1,691,035 20.7% Hillside $611,517 25.8% Emmi $540,817 N/A

Heading Up: Emmi 52 Weeks through 9/7/08 SOURCE: Information Resources Inc. Total food/drug/mass excluding Wal-Mart

IMPORT BEER Dollar Sales Change vs. year earlier Corona $441,939,100 -2.2% Heineken $299,865,600 3.7% Corona Light $125,157,100 0.6% Tecate $92,910,010 10.1% Heineken Premium Light $73,538,500 15.5% Modelo Especial $61,040,720 13.5% Newcastle $50,632,180 2.8% Guinness Draught $48,563,960 2.7% Stella Artois $45,629,580 43.2% Labatt Blue $44,019,760 -2.4%

Heading Up: Stella Artois 52 Weeks through 9/7/08 SOURCE: Information Resources Inc. Total food/drug/mass excluding Wal-Mart

16.BEVERAGESPECTRUM.OCT.08 ENERGY Dollar Sales Change vs. year earlier Red Bull $363,400,300 11.7% Monster $141,672,900 18.3% Rockstar $100,580,900 8.1% Amp $33,947,080 25.6% Full Throttle $26,199,540 -34.1% Java Monster $19,153,690 1,124.4% Monster XXL $18,309,220 72.0% SoBe No Fear $17,048,390 -44.6% Amp Overdrive $12,825,420 109.8% Rockstar Juiced $12, 255,680 17.8% Heading Up: Java Monster 52 Weeks through 9/7/08 SOURCE: Information Resources Inc. Total food/drug/mass excluding Wal-Mart

CONVENIENCE/PET STILL WATER Dollar Sales Change vs. year earlier Private Label $694,634,100 10.5% Aquaﬁ na $445,495,300 -13.9% Glaceau Vitaminwater $439,670,800 36.4% Dasani $431,164,400 -4.6% Poland Spring $257,089,400 -0.2% Propel $178,929,500 -8.3% Arrowhead $173,827,200 -6.2% Deer Park $135,224,500 -6.7% Nestle Pure Life $121,187,400 4.3% Crystal Geyser $105,716,800 -1.3%

Heading Up: Vitaminwater 52 Weeks through 9/7/08 SOURCE: Information Resources Inc. Total food/drug/mass excluding Wal-Mart

DOMESTIC BEER Dollar Sales Change vs. year earlier Bud Light $1,352,248,000 3.8% Miller Lite $688,197,700 1.6% Budweiser $659,891,300 -2.7% Coors Light $644,709,000 8.5% Natural Light $267,739,400 1.1% Michelob Ultra Light $202,730,500 4.7% Busch Light $195,868,800 3.7% Miller High Life $165,455,800 5.2% Busch $150,362,100 3.2% Miller Genuine Draft $141,082,200 -7.6%

Heading Up: Coors Light 52 Weeks through 9/7/08 SOURCE: Information Resources Inc. Total food/drug/mass excluding Wal-Mart

OCT.08.BEVERAGESPECTRUM.17 NEWPRODUCTS

BEER amber color and bright, hoppy finish is the ideal counterpart to Budweiser’s signature This fall, Miller Lite is introducing a new, golden, crisp flavor. Budweiser American Ale 16 oz. aluminum pint bottle that enhances is an all-malt, top-fermented ale that is dry the Miller Lite taste experience. The pint’s hopped with Cascade hops from the Pacific wider opening provides a smoother flow to Northwest. Budweiser American Ale is 5.3 enhance the Miller Lite taste experience; the percent alcohol by volume (ABV). It will be aluminum cools like a can; and the resealable supported in the marketplace by a targeted closure helps lock in freshness. The Miller media plan consisting of television, print, Lite aluminum pint will be tested throughout outdoor and Internet, along with exclusive much of the Midwest and South through the sampling events and on-premise merchan- end of the year. The Miller Lite aluminum dising. For more information, call (314) pint, designed by Broomfield, Colo.-based 577-9671. Ball Corporation, is intended for off-premise retailers, with a focus on convenience stores. ENERGY DRINKS The package will be sold as part of a 9-pack. MillerCoors will support the debut of the Go Fast Sports and Beverage Company, cre- Miller Lite aluminum pint with television, ator of Go Fast Energy Drinks, announced radio, out-of-home and online advertising, that this fall, Go Fast Energy Drinks will as well as a variety of retail point-of-sale and now be available in a 16 oz. can. Also merchandising materials. For more informa- launching in the new 16 oz. cans will be new, tion, call (414) 931-3848. revolutionary formulas; Z-17, Light and MillerCoors is also relaunching Foster’s GFTea. Z17 was created by Go Fast to pro- Special Bitter as Foster’s Premium Ale.The vide you with the most unique flavor blend. beer remains the same. But the packaging is Z17 still provides that Go Fast “kick” but getting tweaked along with the name. The with the flavor, additional energy and ben- Foster’s Premium Ale oil can contains more efits of Green Tea. GFTea includes a one of a gold coloring and the logo is cleaner and kind taste with an exclusive blend of White, more closely resembles the Foster’s Lager. Oil Green and Black teas. Go Fast Light has the cans and 12-packs hit retail in August. For benefits of Z17 but in a light formula with more information, call (414) 931-3848. little aftertaste and no “diet” flavor. Hitting Michelob Dunkel Weisse and Michelob store shelves this fall, Go Fast Sports and Pale Ale are joining Michelob, Michelob Beverage Company will also be premiering Light, Michelob AmberBock, Michelob the new line of flavors and 16 oz. cans at this Honey Lager and Michelob Porter as beers year’s NACS. MSRP is $2.59 per can. For available year-round to adults nationwide. more information, call (303) 893-1222. Dunkel Weisse is an unfiltered dark wheat ale brewed with a special Bavarian yeast DAIRY strain combined with wheat, caramel and Portland, Maine based Oakhurst Dairy has chocolate malts. Pale Ale, previously only announced that they will be introducing available on a select seasonal basis in the Oakhurst Super Premium Chocolate Milk to annual Michelob Specialty Sampler Pack, consumers across Northern New England. can now satisfy beer drinkers throughout the New Oakhurst Super Premium Chocolate year with its delicious floral and citrus notes. Milk will be made with Oakhurst’s high These Michelob Brewing Co. beers are also quality fresh whole milk produced with no getting a fresh, consistent look. Each will be artificial growth hormone. Oakhurst has had packaged in the brand’s signature embossed an overwhelmingly positive response from bottle with its raised ridge around the neck retailers to the Super Premium Chocolate displaying a subtly arched label trimmed in Milk which will be available in both con- muted gold. New 6-pack carriers will show venient on-the-go pints and in quarts. The detailed information on the side panel about new product will be supported by in-store the ingredients, taste and color of each beer merchandising, including shelf strips and style. They will be line-priced with other fridge clings, and with trade advertising. For Michelob products. For more information, more information, call (207) 772-7468. call (314) 577-9105. After debuting on draught, Budweiser FUNCTIONAL BEVERAGES American Ale launched in 12 oz. 6-packs and 22 oz. singles at select on- and off- NESTLE, the world’s largest food and bever- premise retail accounts. Robust and well- age company, has introduced GLOWELLE, rounded, Budweiser American Ale’s rich a daily beauty drink dietary supplement that

18.BEVERAGESPECTRUM.OCT.08 protects and hydrates the inner and outer of the region’s unique terroir and represent layers of the skin. GLOWELLE is formulated the very best Monterey has to offer. The small with a proprietary blend of high antioxidant production Monterey Vineyard Pinot Noir vitamins, phtyo-nutrients, botanical and fruit has a suggested retail price of $25.99. The extracts to help fight the signs of aging by Monterey Vineyard Chardonnay has a sug- nourishing the consumer’s skin. GLOWELLE gested retail price of $22.99. Both wines will is available in beautiful ready-to-drink glass be available nationally with the 2007 vintage. bottles as well as convenient seven (7) or 30 For more information, call (707) 299-2626. day powder pack kits. Made with real tea, fruit and botanical extracts, GLOWELLE of- RTD TEA fers two flavors, Natural Raspberry Jasmine The Healthy Beverage Company, makers of Flavor and Natural Pomegranate Lychee Steaz Sparkling Green Tea and Steaz Energy, Flavor. GLOWELLE is available exclusively has introduced its newest organic tea in- at Neiman Marcus stores nationwide and novation – Steaz Organic Iced Teaz. Steaz Bergdorf Goodman. Glowelle’s MSRP is $7 Organic Iced Teaz is the first full line of fair per bottle, and the powder is $40 for 7 day trade certified, ready to drink iced teas. Fla- and $112 for 30 day. It can also be found vors include four green tea varieties (Peach, online at NeimanMarcus.com. For more Blueberry/ Pomegranate/Acai, Mint, and information, call (212) 598-4400. Unsweetened with Lemon), black tea with lemon and white tea with lime and pome- WINE granate. They are available in 16 oz. fully Sterling Vineyards, the landmark Napa recyclable aluminum cans. At 40 calories winery, has announced a new line of organic per serving, the teas are lightly sweetened wines from Mendocino County, Sterling with 10g of pure cane sugar and contain Vineyards Made With Organic Grapes only all-natural flavors. The Unsweetened 2007 Sauvignon Blanc and Chardonnay. with Lemon flavor contains no sugar and has Additionally, a Cabernet Sauvignon made zero calories. Recommended retail pricing from organic fruit is scheduled for release in is $1.79 per can. For more information, call April 2009. The wines have been certified (215) 321-8330. by the California Certified Organic Farm- ITO EN has debuted the Oolong Shot, a ers (CCOF) organization, whose emblem premium unsweetened ready-to-drink tea appears on the back label. The SRP for both brewed from whole loose oolong tea leaves. the Sterling Vineyards Made with Organic The drink, which contains more oolong tea Grapes Chardonnay and Sauvignon Blanc leaves brewed per serving than any other is $13. For more information, call (707) ready-to-drink oolong tea on the market 299-2618. delivers a whopping 171 milligrams of Sutter Home has taken a contemporary oolong tea polyphenols in a convenient 6.4 twist on tradition and broadened the defini- fluid ounce steel can. Oolong, also known tion of ‘red blend’ for more to enjoy. The as Wu-long and traditionally called blue Napa Valley-based winery’s latest offering, tea, is a dynamic balance between green tea simply called ‘Red,’ offers consumers a and black tea. Full bodied with a smooth chance to further their wine tastes. A blend finish, research shows that an unidentified of predominantly Merlot and Zinfandel, compound in oolong may promote weight Sutter Home pushed the envelope and loss. The tea is gaining popularity in the mingled in a touch of Moscato, a varietal United States among the health and weight that has enjoyed wild success among Sutter conscious. The Oolong Shot retails for Home fans for years. Also widening the $1.79 and will be available at natural and appeal is how the wine can be served – at mainstream markets nationwide. For more room temperature as one would serve a red information, please call (707) 327-6413. wine, or chilled as with a white wine. Red This fall, it’s all about what’s new for began hitting stores around the country in High Country Kombucha, which is introduc- mid-August, with a suggested retail price ing a brand-new herbal-infused Kombucha of $5.99.For more information, call (707) line, a new presence in the national market 963-3104. and a new face at this year’s Natural Prod- Diageo Chateau & Estate Wines has ucts Expo East trade show. The new herbal announced the launch of The Monterey Vine- line has five different flavors: Elderberry Hi- yard, an ultra-premium Burgundian brand biscus, Lemon Myrtle, Tibetan Chai, Herbal from two of Monterey’s most respected sub- Passion and Herbal Lite. Pricing has not yet appellations, Arroyo Seco and Santa Lucia been released for these products. For more Highlands. The Monterey Vineyard Pinot information, call (720) 352-7144. Noir and Chardonnay wines are a reflection

OCT.08.BEVERAGESPECTRUM.19 RECOVERY DRINKS KIDS BEVERAGES Code Blue, which calls itself “the world’s The American Beverage Corporation first complete recovery drink,” is available proudly introduced two proprietary new, for purchase at www.drinkcodeblue.com. kid-friendly drink alternatives this Septem- Designed by beverage scientists to revive ber – Wall E Ice Bop juice slushies and High your body, Code Blue is intended to combat School Musical fruit drinks. Both products dehydration, replenish vital nutrients and are all-naturally flavored, use no preserva- remove harmful toxins. Code Blue was cre- tives, are under 110 calories, and are rich in ated for people who enjoy going out at night antioxidants appealing to consumers looking but need to wake up feeling refreshed the for healthier drink alternatives for their next morning. Code Blue can be consumed children.Wall E Ice Bops – licensed with the before, during and after a night out to speed robot character of the movie with the same the recovery process and bring the body back name – are an innovative product that offers into balance. Code Blue is the first ready-to- the excitement of frozen fruit slushies at drink beverage to include Reduced Glutathi- home, at a picnic, beach or the park without one, one of the most powerful antioxidants the hassle of a blender. They come in a con- available. The drink is sweetened with venient pouch and are made with 50% juice, natural agave nectar. Code Blue is packaged are all naturally flavored, naturally low in in a fully recyclable 12 oz. PET opaque blue calories, high in antioxidants and contain no bottle. Its cutting edge design utilizes “Liq- preservatives. Wall E Ice Bops are available uidMetal” technology to replicate a polished in four flavors: Space Station Strawberry, metal look, and a 3D Holographic Ink label Tropical Sunshower, Meteor Mixed Berry which provides a strong shelf presence. This and Lunar Lemonade.The new High School product is searching for national distribution Musical fruit drink is a line of single-serve, with an expected MSRP of $2.99 per bottle. naturally flavored fruit drinks in an 8 oz. For more information call (212) 584-4274. proprietary Disney ears PET bottle. This fruit drink line carries the widely popular SPIRITS Disney High School Musical branding and will be available in three flavors – Reach Heaven Hill Distilleries, Inc., the nation’s for Melon Peach, Big Game Lemon Berry, largest independent family-owned spirits and East High Fruit Punch. Wall E Ice Bops supplier, has announced a licensing agree- will retail for a suggested price of $3.49 for ment with McIlhenny Company of Avery a four-pack. Twist ‘n’ Chill will retail for a Island, Louisiana, creator of Tabasco brand suggested price of $3.79 per six pack. Pepper Sauce, to produce Tabasco Spicy Tequila. Created from premium tequila fla- RTD COFFEE vored with the authentic and iconic Tabasco brand Pepper Sauce, Tabasco brand Spicy POM Wonderful has launched POMx Iced Tequila is a unique and perfectly balanced Coffee, available exclusively in New York marriage of the highest quality tequila City and Whole Foods Markets in the with the hot, spicy and bold Tabasco kick. Northeast and North Atlantic States. With a Tabasco brand Spicy Tequila will be avail- potent dose of caffeine and healthy antioxi- able in a striking proprietary 750ml package dants, POMx Iced Coffee is a sophisticated that features the highly recognizable Tabasco energy drink for consumers who seek an en- “Diamond” logotype graphic on the face ergy boost but who typically avoid the excess label, with red and gold foil flames rising be- sugar and artificial ingredients associated hind to the edges of the rectangular border. with carbonated sodas, coffee beverages and Offered at a suggested retail price of $21.99 energy drinks. POMx Iced Coffee does not for the 750ml bottle, Tabasco brand Spicy include or taste like pomegranate juice, but Tequila began selling in September in Dal- comes in two creamy and delicious flavors: las, Houston, Georgia, Indiana and North Cafe au Lait and Chocolate. Each bottle of Carolina. The brand will be supported by POMx Iced Coffee contains a Healthy Buzz a full range of on- and off-premise point-of- -- a stimulating 175mg dose of caffeine and sale material, including a branded website enough POMx to equal the antioxidant pow- www.TABASCOtequila.com, all utilizing the er of an 8 oz. daily dose of POM Wonderful “Heat Up the Night” tagline and graphics. 100% Pomegranate Juice. Sold in a 10.5 oz. For more information call Heaven Hill at single-serving bottle, POMx Iced Coffee has (502) 413-0220. a suggested retail price of $2.99. For more information, call (310) 966-5858. U

20.BEVERAGESPECTRUM.OCT.08 Consumers want beverages with healthy ingredients. Leave it to WILD. Concern about fostering good health as well as maintaining a high quality of life has been shown to impact 70% of food purchases. Consumers’ belief that active ingredients reduce the risk of disease and improve long-term health qualities has pushed the functional foods market to domestic sales of $26.9 billion and $81 billion worldwide.

Recognizing the need for ingredients without formulation issues, WILD Flavors has developed H.I.T.S., Health Ingredient Technology & Solutions®. This line of health ingredients will add value to your formulations for more commercially viable foods and beverages. To support you in implementation of H.I.T.S. from concept-to-market with industry, market and technological support, WILD offers health ingredients, flavors, colors, sensory evaluation and complete commercialization of ideas.

WILD’s Heart Healthy Tropical Beverage

To learn how WILD can help your formulations fall in favor with consumers, call 1.888.WILD FLAVORS, or email us at [email protected]. GERRY’S INSIGHTS By Gerry Khermouch MORE THAN A MARGINAL DIFFERENCE

COUNT ME AMONG the wrong- elevated price for good coffee and everybody ter and smartwater. Sad to say, even before headed majority who were doubters back in else, from Caribou to Dunkin’ Donuts and that brand reaches its one-year anniversary the late 1990s after Red Bull had inaugu- McDonald’s, has been happy to ride its coat- in November of its transition to the Coke rated the energy drink category, and with it, tails by conjuring up premium offerings at a bottling system, that segment has gone the profi t margins that were unheard of in soft premium price. way of bottled waters, iced teas and isoton- drinks. Surveying the aisles crammed with True, over the past year promotional ics, as Coke blows out the brand at 10 for knockoff brands at the InterBev show the activity in energy drinks has been on the rise $10, fi ve for $5, even 10 for $8 while rivals following year, it was easy to predict that the – two-for-$3 deals and three-for-$5 deals for Pepsi (with SoBe Life Water) and Dr Pepper competition would knock down those rich the 16-oz. players – at a time that mount- Snapple Group (Snapple Antioxidant Water) margins in no time, leaving energy drinks as ing economic stress has winnowed traffi c at likewise plumb the $1-per-bottle barrier. By just another modestly profi table segment. It convenience stores and begun to force many some estimates, in doing so, Coke already wasn’t just me; lots of others drew the same Americans to cut back even on so-called has cut the value of its $4.2 billion invest- conclusion. After all, it had played out that affordable luxuries. Even if margins have ment by nearly half. way in every other segment. Yet looking at edged back a bit from $6 or $8 per case, Against that dreary picture, energy drinks energy drinks a decade later, their margins they’re still uncommonly lush. are a marvel to behold. So how long can this are still the envy of the business. The widely So why did this segment break the trend? lucrative run continue? We can’t rule out as predicted margin collapse has yet to occur. Looking at what’s happening in other non- a concern that the foundering economy will I wonder if we all refl ect often enough on alcoholic beverage segments, one has to increase the stress on margins for this most what a miracle that is. After all, we’ve seen wonder whether a key factor has been that blue-collar of segments. Given the lessons of literally hundreds of entries come and go, in- several of the leading brands continue to the other categories, though, I fi nd greater cluding quite a few from such industry giants operate independently. Red Bull, facing more concern in some of the maneuvering that as Coca-Cola, PepsiCo, Dr Pepper Snapple intense competition in this country than it was occurring as this article was going to Group and Anheuser-Busch, but we have had experienced elsewhere, hasn’t panicked. press: Coke trying to establish a distribution yet to see the ruinous price wars that have It’s maintained its high register ring and tried alliance for Monster, Rockstar looking to characterized every other sector. How du- to orchestrate its inevitable diversifi cation negotiate a similar partnership with Pepsi or rable have the premium brands been? Even into larger packages in a way that doesn’t DPSG if it loses its place at Coke. In both private label has barely made a dent. Among seem as if it’s discounting. Hansen Natural’s cases, it seemed likely that an equity invest- other beverage categories, I can think only of Monster, while fi ghting its skirmishes with ment would be negotiated as part of the beer as a segment where private label is not Rockstar and Full Throttle, has maintained deals, meaning both brands would lose some a factor – and in beer there is a thriving tier its marketing commitments in alternative of the autonomy they’ve enjoyed under their of subpremium brands, which is far from the sports and offered line extensions – notably current distribution partnerships. No ques- case in energy. Java Monster coffee energy drinks – that tion, in areas from procurement to overseas For the most part, consumers have been generate an even higher register ring. expansion to procuring bigger beachheads in content to stick with premium entries. I Contrast that pattern with segments like non-c-store channels, those alliances could think much of the credit for that should go iced teas, sports drinks and bottled waters. be very benefi cial. But seeing how quickly not just to the restraint shown by the manu- They were all premium businesses until those giants have managed to turn enhanced facturers of energy drinks but to retailers Coke and Pepsi entered and eventually waters into a commodity makes me wonder who’ve worked hard to protect this impor- turned them into a new front in the cola if, for energy drinks, those potential rewards tant profi t center. A lot of you Beverage wars. In the latest segment in which they’ve will be worth the tradeoff. Spectrum readers have been smart enough chosen to do battle – enhanced waters – the not to let anyone kill this golden goose. transformation from premium to commod- Longtime beverage-watcher Gerry To fi nd another beverage segment that has ity is occurring with scary rapidity. Barely Khermouch is executive editor of protected its margins as well you have to a year ago this niche was a paragon of Beverage Business Insights, a twice-weekly venture outside the ready-to-drink segment superpremium pricing, thanks to the efforts e-newsletter covering the nonalcoholic to hot coffee, where Starbucks established an of Glaceau, the deft marketer of vitaminwa- beverage sector.

22.BEVERAGESPECTRUM.OCT.08

WE ALREADY HAD A V8 By Hinda Mandell FOR 75 YEARS, V8 has been trying to get us to drink our vegetables. But recently, the brand managers turned to an unfamiliar ally to try to pump some life into the old warhorse of a brand: fruit.

hile the prototypical good- rolling out V8 Splash, a fruit juice mixture, making V8 V-Fusion 24-hours a day,” for-you drink marked three and more recently and impactfully, V-Fusion, said Juli Mandel Sloves, a spokeswoman quarters of a century this year, a daring fruit-and-vegetable juice combina- for Campbell’s, which purchased the it had to change. Although it’s tion, the V8 brand has been revived from its brand in 1948. managed to stay consistent with old-age doldrums faster than you can Not a bad turnaround for a brand that its original mission to provide a drink for the say “Cocoon.” was becalmed in the center-store doldrums. consumer who knows that veggies are good “They’re taking a good corporate band Lately, all the excitement in the juice cat- but doesn’t have the time to prepare them, name and branching it out over good-tasting egory has rested in the new produce-centered V8 pulled itself out of an innovation lull – [fruity] beverages,” said Marty Brown, lines of superfruit drinks like POM Wonder- and into a high-visibility deal with distribu- president of the California-based beverage ful and Naked, rather than in the shelf-stable tors like Coca-Cola Enterprises – by crossing consulting fi rm, Power Brands. And the aisle. Even the once-innovative Ocean Spray the produce aisle and marrying itself to some market has responded. has taken it on the chin, and attempted to sweeter fruit fl avors. Even as second-quarter earnings for branch out into energy drinks, of all things. In all likelihood, however, it was a forced Campbell’s fell 3.9 percent in February, ac- But rather than trying to beat the produce- union. Staying true to its space-age “drink cording to the Wall Street Journal, V8 put in centric superfruits, V8 joined them, and your vegetables” motif had, over the years, a strong performance. Information Resourc- did so while playing on its own halo as an left the brand as crusty and old as John es Inc. reported that sales from V8 Splash extremely healthy, if not “super,” product. Glenn and his fellow Mercury astronauts. and V-Fusion were up 12.46 percent and Today, the company that has been selling a The story of how V8 made the move from 82.25 percent, respectively, for the past year. blend of tomato, carrot, celery, beet, parsley, space age to information age, adding new V8 Splash sales in supermarkets, drugstores lettuce, watercress and spinach juices for the SKUs that include – heresy! – fruit juices, and mass merchandise outlets – excluding better part of a century, is now offering on- offers an interesting lesson in how a well- Wal-Mart – totaled more than $61.1M for trend fl avors as hip as the hottest beverages established but ancient brand can keep the year ending March 23. V-Fusion’s sales out there. In the mood for an Acai Mixed itself relevant and entice a new generation topped $75.1M. CCE reported that its V8 Berry beverage? What about some Blueberry of consumers. partnership was responsible for 10 percent Pomegranate, Strawberry Banana, or Peach In so doing, the brand managers also of the volume growth of its still beverage Mango liquid refreshment? V-Fusion has a made the product into an important part of portfolio in the last year. variety for each – with a vegetable base that parent company Campbell’s bottom line. In “We can’t keep it on the shelf. We are is barely detectable to the taste buds. And

24.BEVERAGESPECTRUM.OCT.08 The company that brings you Sun Shower™ 100% Nectarine Juices has just made some great additions to its family of nutritious and delicious beverages:

• All Natural 100% Juice Superfood Smoothies—(Stamina, Defense, Heart Healthy, Revitalize, Strength) • All Natural Superfood Fruit ‘N Yogurt Smoothies—(Strawberry-Banana, Berry Blast, Orange Passion, Pina Colada) • Super Blends—Healthful Indulgence (Iced Coffee, Chai Tea Latte, Mocha Cappuccino, Chocolate Raspberry Frappe) • All Natural 100% Juice Super Juice—(Stamina, Defense, Heart Healthy, Revitalize, Strength) • Super Juice Beverages: Light ‘N Healthy—(Stamina, Defense, Heart Healthy, Revitalize, Strength)

Each new Sun Shower™ flavor features the Lifeguard™ fortification package of essential vitamins, nutrients, amino acids, electrolytes and herbs. Give your customers something new and unique that is also nutritious and delicious. Give them Sun Shower™. www.nbijuiceworks.com the juice’s color is no longer just tomato After all, not everyone is keen on the old- way for new customers to try V8’s fruitier red: it spans the rainbow to include purple fashioned V8 product, a fact even Camp- varietals. and orange. bell’s acknowledges. This gap – between “V8 is capturing a whole group of “If you appreciate the core benefi t around those who drink V8 for health’s sake and consumers who are reinforcing the fact vegetable nutrition in a beverage, your those who were likely to forsake nutritional that they’re drinking something healthy imagination can run wild,” said Darren Ser- health because of the taste – read: KIDS because it has the V8 label,” said the rao, vice president of beverages at Campbell – proved enough of a market segment to veteran executive. Soup Company. prompt V8 to add a splash of fruit. The next challenge for V8 is to keep up Still, it took a long time to start running The goal was to capture the purchasing with the demand. Increased production at all – much to the grumbling of distribu- power of those who don’t like the “zesty, space for V8, V8 Splash and V-Fusion may tors. For years, the company only saw fi t to tomato-y taste of original V8,”said Mandel require capital investment in the near future. push out marginal line extensions that put Sloves. Campbell’s even gave this group a According to a transcript from the second the product in the hands of those who were name: “red-rejectors.” quarter press conference in February, Bob already familiar with the brand, rather than “We estimate that these ‘red rejectors’ Schiffner, senior vice president and CFO at extending its reach through fruit. make up 50 percent of the population and Campbell’s, said: “As far as the capacity is And that risk aversion apparently held therefore a signifi cant audience that we could concerned … we are nearing capacity con- off innovation at the company for a long reach with a new product just for them,” straints … we will be spending capital start- time, making it seem like a product only said Mandel Sloves. ing this year into next year to add additional drunk on airplanes and at brunch, mixed So the innovation of a squeeze of fruit was capacity in beverage.” into a “Bloody Mary” with its eternal a solid one. After all, the brand has always Doug Conant, president and CEO of companion, vodka. had a healthy aura. Consumers ranked Campbell’s, cited “a strong record of in- V8 as the healthiest brand in the 2007 HealthFocus Trend Report, which provides analysis of food shoppers’ health and nutrition behaviors. Consumers were asked to rate brands – beverage and foodstuff – they believe are “extremely or very healthy by those who are familiar with the brand.” V8 captured 66 percent of the vote, beating 49 other brands for the top slot, including such wellness brands as Quaker, Kashi, Horizon Organic and Organic Valley – all of which tied for second place. Potential competitors to V8, such as Tropicana and Ocean Spray, ranked 12 and 19, respectively. Campbell’s ranked 24. And it’s worked. Households with kids, adults 25 and over, are the ones buying the V8 fruit lines as core consumers, according With Splash, V8 started its campaign to to Mandel Sloves. Part of what has attracted With V-Fusion, the company has stepped move past its traditional boundaries into the families to try V8 Splash and V-Fusion is solidly into the New Age, mixing up fruit juice blends. the recognition of the original brand name, veggies with its new fruit drinks. say beverage analysts. It’s almost like bever- For one industry insider and veteran of age nepotism – picking up a brand on the novation” as driving the performance of the Coca-Cola Company and Coca-Cola basis of a parent’s good name. company’s beverage segment at the Con- Enterprises – which has been distributing “Where it’s positioned, it has very, very sumer Analyst Group of New York Confer- V8 since 2007 – the question is: “What good, solid brand name recognition,” says ence in February. In fact, beverages – i.e. V8 took so long?” Brown. “If you think about a tomato based – represented the best-performing segment of There’s a good point there. After all, check product, you’ll think about a V8.” Campbell’s business in 2007, according to a out these SIZZLING line extensions: Low But before to the decision to add the fruit, transcript from the event. Sodium! Spicy Hot! High Fiber! Calcium that may have become as much of a liability “We have migrated our positioning of V8 Enriched! No wonder it generated the excite- as it was an advantage. from merely a smarter juice choice among ment of a Tuesday night Bingo game. Campbell’s wouldn’t provide details on many on the shelf to a key weapon in the Everyone loves a good “Bloody,” of how and when, specifi cally, the decision search for an easy way to consume more veg- course. But for a long time, the core con- emerged to juice up the brand. Nor did it etables every day,” said Conant. He added: sumer of V8 has been perceived to be as say whether there was any opposition to the “V8 V-Fusion is ideally suited for consum- much an enthusiast of blood thinners as they move. According to Mandel Sloves, however, ers who are looking for vegetable nutrition are of cocktails. there was “great enthusiasm for the opportu- without vegetable taste. As a result of the When a brand reaches geriatric age, it nity to evolve the V8 brand.” strength of this proposition, V8 V-Fusion has can either slow down with its consumers – a And decades of effective advertising for been the best launch in the shelf stable juice la Ovaltine – or it can try to stay spry, and V8 – showcasing the healthfulness of veg- category in the past fi ve years.” that’s fi nally what V8 has done. etables in a bottle – may have also paved the There you go: an overnight success. At 75. UÊ

26.BEVERAGESPECTRUM.OCT.08

BRANDS IN TRANSITION MAGIC HAT’S NEW TRICKS BY MATT CASEY

Anyone who has ever cracked open an apricot-tinged Magic Hat #9 will tell you that Magic Hat takes a unique approach to Magic Hat’s Brewery Bar. beer. The company has never followed the conventions of the industry, and has experi- purchase Pyramid in a move that represents shoes and pressurized room – the result of mented with fl avors most brewers wouldn’t a new stage for the quirky Vermont beer pumped-in fi ltered air – keep wild yeast out. approach. (Think lemongrass. Or – ick – company. But, for those of you reading on All of those little issues add up to a bigger garlic.) Couple that with quirky promotions the West Coast, don’t expect to pick up a one: the room can’t grow. Cohen calls it the that range from traveling circuses to Mardi six-pack of Berkeley-brewed Magic Hat any company’s “pinch point.” As Magic Hat Gras parades in eight-inch Vermont snow time soon. gains popularity amid a craft beer market storms, and the brand has earned a reputa- “That last thing in the world we would that grew 12 percent in 2007, the brewery tion like none other – but what else would try to do would be to consolidate the approaches the limits of its capacity. Magic you expect from a brewery that spawned brands,” Newman said. Hat already moved its headquarters once, from the same city as Ben and Jerry’s Ice While there’s probably some ideology to but Cohen said the company has striven Cream and the alternative rock band, Phish? Newman’s aversion to consolidation, there’s to deliver consistent product as it has Despite the brand’s free-wheeling Burling- a practical aspect as well. According to become more popular. ton vibe, Magic Hat founder Alan Newman Magic Hat Brewer Matt Cohen, the beer he And it has defi nitely become more popu- knows a bit about business. In the late 80s, brews can only be fermented in one place: lar. According to the Brewers Association, he bought a catalogue company called Re- the high-school-gym-sized fermenting room Magic Hat’s sales hit 102,506 barrels in new America that sold Earth-friendly house- at the South Burlington Artifactory. 2007 – up from 38,400 in 2003 – after four hold products. Today, that company – now continuous years of 23-40 percent annual called Seventh Generation – ranks as one of PINCH POINT growth rates. Vermont’s largest employers, and stocks the The company uses an open fermentation cleaning aisles at natural foods retailers like process, which allows continuous reuse of ORGANIC AND GARLIC Whole Foods, but Newman’s tenure with the the same yeast. Other breweries have to But growth brings pain. The brewery had company ended in 1992 when his partner discard their yeast after three or four genera- to discontinue several fl avors – including forced him out. Undeterred by his ouster, he tions. Keeping the yeast creates a consistent Humble Patience, Magic Hat’s one-time started Magic Hat. The brand’s distribution note in the beer, and Cohen said the room fl agship product – because their sales didn’t territory initially clung close to the coast itself “creates a unique fl avor that’s found warrant continued production. Additionally, of Lake Champlain, but, today Magic Hat across all of our beers.” not everything they try succeeds. ranks as the twelfth-largest U.S. craft brewer, Crammed tight with catwalks and open- Cohen said Magic Hat once brewed a and sells #9, Circus Boy, Lucky Kat, Single topped vats, the room smells faintly of fruit. garlic-infused beer that served best as a pen- Chair Ale and a selection of seasonals as far Bubbles gurgle out of fresh worts – the alty for losing a bet, and their Orlio organic south as Georgia and as far west as Chicago solution that, with the help of microorgan- line has suffered from fi ts and starts since its – admirable progress for a man that says he isms, becomes beer. Waves of carbon dioxide March 2007 roll-out. Initially launched with got into a business he “didn’t understand.” tumble out of the tops of the vats, and yeast blanket distribution, it didn’t quite catch on “I really don’t have a crystal ball and forms a crust on beer nearing the next stage everywhere. Magic Hat spokeswoman Krissy I really don’t know what’s going to of production. Those conditions, Cohen Leonard said that initial broad launch al- happen,” Newman said, “so I keep said, hold a key to Magic Hat’s personality. lowed the company to fi nd out where the following my nose.” But that unique fl avor comes with a price. product worked, and calibrate their support Newman plays humble, and calls himself Cohen can only brew with one strain of accordingly. Since then, she said the line is “stupid,” but he earned the label of “serial yeast at a time – otherwise they’ll cross-pol- “doing everything that we’d expect it to.” entrepreneur” from the Wall Street Journal, linate – and the conditions surrounding the Then there are the physical limitations of so he must be following one lucky nose. room faintly resemble those of a Haz-Mat that one precious room. To get around them, Lucky or not, that nose recently led him lab. Okay, so nobody wears sterile plastic the company installed new equipment and all the way to Pyramid Breweries on the suits to check the beer, but anyone entering expanded its facility. They added a centrifuge West Coast. Newman and his partners the room washes their shoes fi rst, and air to cleanse the beer more quickly, built two at Magic Hat ponied up $25.7 million to rolls out when they open the door. The clean grain-silo-like towers to free up fermentation

28.BEVERAGESPECTRUM.OCT.08 space, and recently completed a new bottle “When we began, the hottest category otherwise-solo breweries fi lling line. in alcoholic beverage was something called under Independent Brew- That last one represents a big jump. The wine coolers,” he said. “Then that disap- ers United Inc., will allow old bottling line – still in operation – can peared and next came ciders... then ciders the companies to be “big clean, fi ll, cap, label and pack 100 bottles kind of lost their way and that new amor- behind the scenes.” The per minute. The Magic Hat crew ran the phous malt beverage started coming in... and two breweries will be able machine 24 hours per day, six days a week now you have a huge infl ux of what I’ll call to share costs and knowl- just to meet demand. In September, they super premiums.” edge on the back end while started the new bottling line. This one can His solution to the ever-changing maintaining their own process 400 beers per minute, but has yet to market is to accept that the environment personalities. be pushed to that limit. will change, and employ people that stay The deal puts a scat- “If we didn’t do the Pyramid deal…. plugged-in and passionate about beer. In the tering of West Coast Magic Hat would be fi ne for the next three current environment, merging makes sense. infrastructure under Magic to fi ve years,” Newman said. And despite suddenly owning a second beer Hat’s control, but also, company, Newman said he and the Magic as Brewers Association CRYSTAL BALLS Hat team “really believe in small indepen- Director Paul Gatza put it, But what of the Pyramid deal? Newman dent craft breweries.” “puts Magic Hat a little bit called it part of the company’s “longer-term He’s not kidding. Cohen, standing in in the restaurant business.” Lucky Kat, strategic vision” – something that sounds Magic Hat’s quality control room (one of the Pyramid operates two one of the seasonal suspiciously like it might involve a crystal few quiet places in the Artifactory), said he production breweries with offerings. ball, though, perhaps a hazy one. New- doesn’t view other craft brewers as competi- attached restaurants and man said he doesn’t have a plan for what tors. Their experience has told them that three stand-alone brew pubs. the world will look like in fi ve to ten years, craft beer drinkers don’t declare their alle- “I see it as more evolutionary than any- but, the way he sees it, the beer industry is giance to a single brand. Instead, they gravi- thing else,” Newman said. “I don’t see it as currently in a state of consolidation. For tate toward a handful of brands and dabble being that huge of a leap, but that could be evidence of that, look no further than the in others. If a Magic Hat drinker picks up because I’m stupid.” big American brands of Coors and Budweis- a six-pack of Switchback or Sierra Nevada, Newman said if he had time, he’d proba- er, now divisions of MillerCoors and InBev, the theory is that the company hasn’t lost a bly fi nd the transition at Magic Hat “scary.” respectively. Newman doesn’t like it, he customer, because they’ll be back. But he doesn’t have time. So, he’s excited. said, but he doesn’t make the rules. He So why consolidate? “I may be in for the shock of my life,” he just plays the game. Because, Newman said, uniting the said. “But we’re still in the beer business.” UÊ

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OCT.08. BEVERAGESPECTRUM.29 POWDER POWER BY MATT CASEY

dmittedly, powdered beverage BIRTH OF A TREND value-added products.” mixes aren’t new technology. Before there was a trend, there was Crystal Despite those higher prices, drink mixes Tang, after all, has been around Light. The sugar-free mix debuted in 1984, still ring in as inexpensive refreshments and long enough to have been and powered sales through its low-calorie appeal to “price sensitive” consumers, Goel used during NASA’s Gemini status – and an endorsement from Dynasty Lal said – which falls directly in line with the program in the 1960s, and, star Linda Evans. (She played Krystle Car- history of powdered drinks. early on, Gatorade sold in canisters as often rington, don’t-cha-know.) Even though Kool-Aid, the fi rst powdered drink, hit the as it sold in bottles. But modern marketers Dynasty ended in 1989, and big hair soon market in 1927, according to the Hastings have taken a new twist on powdered drinks. followed, Crystal Light pushed on with Museum. Long before cult suicides made Instead of relegating drink mixes to tubs a revolving cast of spokeswomen and the “drinking the Kool-Aid” into a popular that sit in mom’s cabinet, new powdered banner of “I believe in Crystal Light because epithet for brainwashing, the brand rose to beverages come in single-shot sleeves, called I believe in me.” Along the way, Kraft sold popularity as an attainable luxury, a step “sticks,” that can go everywhere that bottled the product in both large canisters and in up from pedestrian water. During the Great water can. multi-packs of individually-packaged tubs Depression, inventor Edwin Perkins sold “The stick is very portable,” said Ryan pre-measured to mix with a pitcher of water. packets for 5 cents each, and cash-strapped Alarid, co-owner of Zizzazz Explosive As a brand in touch with its mostly-female families snapped the product off the shelves. Energy Mix. “It’s not like the old Gatorade customer base, Crystal Light noticed when Perkins’ company churned out as many as canisters… you can’t take that anywhere.” its customers started carrying bottles of one million packets of the powder per day by That convenience, along with price, profi t water everywhere. In 2006, Kraft intro- the time he sold the brand to Kraft in 1953. margin and customizability pushed the over- duced Crystal Light “On the Go” packs, Powdered iced teas, lemonades and other all powdered beverage market segment to a now found in individual packs and ten-stick products arrived later, and fi rms also intro- respectable 7 percent growth rate between boxes. The brand also changed its focus duced the large-format economy canisters 2006 and 2007 according to Mintel market from low-cal to low-cal and high function. that gave rise to the American standbys of research –growth that, in all likelihood, Crystal Light pushes antioxidants in their tea “bug juice” at summer camp and Gatorade hascontinued to increase in 2008. As pow- mixes, vitamin-C in their “Sunrise” pow- showers at the Super Bowl. dered drinks near $1 billion in yearly sales, ders, and energy, hydration and immunity in But the segment had matured and slowed Gatorade, Propel, AriZona, Zizzazz, Jones their “Enhanced” line. That shift not only by the time Bevology co-founder Tom Hicks, Soda and others have added new single-serve parallels the modern beverage industry, it about to leave Naked, fi rst contemplated options. While those companies package also serves as a microcosm for the whole his drink mixes in tablet form. AC Nielsen’s their powders in envelopes, some companies powdered-drink segment. scanner data showed that the segment have taken a more innovative tack on quick- “The major growth has come from energy actually shrunk by 1.1 percent in 2005 in mix drinks, incorporating powders into cap- drink mixes and sports drink mixes,” said food, drug and mass merchandiser chan- delivery systems or condensing the whole Mintel Analyst Garima Goel Lal. “Consum- nels (excluding Wal-Mart – a likely source formula into an Alka-Seltzer-like tablet. ers are usually ready to pay higher prices for of even more sales). Since then, there’s been

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For over 20 years nationally advertised Stacker 2 & Stacker 3 has supplied customers with the hottest Diet & Energy Products on the market while you receive unbeatable margins. Contact: [email protected] 973-786-7868 ext. 243 www.nveusa.com an explosion of brands including Emergen- of water instead of the suggested half liter to $10.50 to $15.00. Selling three 16 oz. energy C, ZipFizz, Easy Drink Packs, and Zym. create a drink with a lighter fl avor. drinks, on the other hand, would yield a Nielsen’s data shows that the segment’s dol- Major RTD brands introducing powdered total sale of $6-9. As a bonus, powdered lar value has grown by 25 percent in those mixes might not like consumers tinkering beverages don’t need to be refrigerated, and channels, as marketers have pegged their with their formula, but Gatorade Spokes- can be strategically located in otherwise powders to functional claims and rolled out woman Jill Kinney said powder extensions hard-to-use spaces. Crystal Light offers stick- individual servings. buttress the core product. holders that hang on cooler doors, but bev- A typical single-serve drink mix costs be- “With the Powder Packs, we’re providing erage mixes present a profi table use of space tween 35 and 55 cents and tops out around our consumer with the opportunity to take even in bulk. Bevology’s Zenergize products 70 cents. Adding a bottle of water raises the their Gatorade on-the-go in the event the come in 10-tablet tubes that retail for $6.99 total price to a range similar to that of an portability of a ready-to-drink product is a and occupy less than an inch of shelf space. RTD, but tap water and a tall glass or reus- barrier to usage,” she said. “With placement That compact nature offers an additional able bottle works just as well as store-bought in the powdered drink aisle, we have also benefi t to retailers – lowered transportation water in a 16.9-oz PET. That not only makes created a new point of interaction with our costs – according to Zizzazz’s Alarid. the carbon-footprint crowd happy, but also consumers in-store.” “For the convenience stores, the margins puts mixes within the reach of Goel Lal’s Consumers can fi nd Gatorade Powder are much higher than your average drink – price-sensitive consumers. Because of that, Packs near the brand’s sister-product, Propel mainly because of fuel costs,” he said. she projects powdered drink mixes will add Fit Powder. Kinney said Propel Fit Pow- Zizzazz’s 72-count retail boxes weigh sales to their respective segments. der met at “extremely” positive consumer less than two pounds, 30 pounds less than Zizzazz’s Alarid also noted that custom- response on the strength of its low-carb and 72 8 oz. Red Bulls would weigh. Factor in ers don’t have to use water as the base low-calorie credentials as well as its vitamin the much smaller package, and the ship- liquid for drink mixes. Other beverages, he payload. She added that the product’s suc- ping costs for mixes approach zero when said, make interesting options – especially cessful debut cleared the way for Gatorade compared to RTDs. Where shipping costs alcohol. He pointed to the example of Red to appear in a compact, quick-mix form. fall, so do environmental impacts, and Hicks Bull. The brand holds a special place in bars While that’s all good news for beverage noted that the compact nature of the prod- where it makes up one half of the now- marketers, the benefi ts of powdered drinks ucts reduces waste. ubiquitous Red Bull and vodka Favorite or extend to retailers and distributors. “Do you want to recycle one of these not, it doesn’t allow bartenders any room small tubes, or do you want to recycle 10 for creativity. Zizzazz, Alarid said, lets them ALL THOSE INCHES bottles?” Hicks said. experiment with four different fl avors while As ultra-compact products, drink mixes run Some stores have even exploited this angle still mixing caffeine with liquor. at a higher price-per square inch than other by selling his Zenergize tablets with Sigg, While versatility with intoxicants might beverages, and could translate to more coin a fast-growing line of metal water bottles, rank as a big perk in bars, consumers can in your cash drawer. AriZona’s Tea Stix, for he added. also customize their drink mixes in most example, come in 30-count counter packs situations by simply using more or less water that take up 18.75 square inches of shelf CAPS AND TABS than suggested. Hicks said his wife, for ex- space – a space that could hold just three 16 Hicks’ brand represents a twist on ready-to- ample, drops one Zenergize tablet into a liter oz. energy drinks – and yield total revenue of go beverages. Instead of packing a breath’s

›› REHYDRATED OPPORTUNITIES Many of the prod- many consumers consumer than the vantages – the RTD ucts entering the rarely visit. However, powdered product. form tastes better, powdered beverage the company saw Jones’ 24c while the powdered market are exten- an opportunity to presents a different form contains more sions of ready-to- expand its audience story. Jones wanted vitamins – and give drink beverages, but amid the surge in to enter the growing consumers two a couple have gone enhanced waters. enhanced water options for drinkable in the opposite di- “We felt like, category, and liked vitamin supplements. rection. Both Jones who could be better the idea of using ‘24’ The RTD version Soda’s 24C and positioned to provide in the brand name. sells in Target Alacer’s Emergen-C a better ready-to- They discovered, nationwide, and existed as powdered drink [enhanced however, that a in DSD accounts products before water] than Alacer?” company called 24c throughout the ﬁ nding their way – Sweyd, Alacer’s Sweyd said. already existed, and country. Godwin said pre-mixed – into vice president for In that spirit, Al- peddled powdered it performs par- a bottle. powders and tablets, acer launched 16 oz. vitamin beverages ticularly well in the with the powders.” Alacer introduced said powdered RTDs with the same in a tiny distribu- Northeast, but the Godwin said. their Emergen-C Emergen-C has been vitamin content as tion area in Costa company didn’t have While Jones feels Health and Energy on shelves for two their powder pack- Mesa, Cali. – so they a strategy prepared out the best way to Water in March, as decades and leads ets. Sweyd said the bought it. for entering the approach the seg- an RTD extension the category in product is perform- Jones Spokesman powdered beverage ment, they’ve signed of the company’s sales, but its appeal ing well in natural Seth Godwin said market. “We’re still 24c with a strong existing powdered is limited to the vita- channels, and the two products kind of ﬁ guring out… distribution partner: products. Bruce min aisle – a place reaches a different offer different ad- how to go to market Whole Foods.

32.BEVERAGESPECTRUM.OCT.08

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!03103"5*0/ȁ"5&3*"-305&$5*0/30%6$54ȁ"3, &453*7& *554#63() ȁ#ȁ)0/& !03 "9 ȁ."*-.11*/'0-"/9&44$0.ȁ888.1164-"/9&44$0. BRAND NEWS worth of powder in a sleeve, he packed his technology to beverage brands that market ZYM Catapult powdered drinks into effervescent tablets. the caps with attached bottles of water, ZYM recently added “Catapult” (read: “plop-plop, fi zz-fi zz…”) Zenergize but a few companies have sold the caps to its line of tablet-based drink and Superfl y dissolve in water, mixing as stand-alone products. At 99 cents to mixes. Infused with 100mg of themselves and giving off bubbles. How- $1.50 each, the caps retail for a higher natural Guaraná caffeine, Cata- ever, that self-mixing process takes about price than either sleeved-powders or tablets, pult is a supercharged version three minutes compared to the few seconds but they bring a hint of novelty and more of ZYM Endurance, the hydra- required to properly stir a powdered mix, convenience to consumers. tion drink introduced two and the tablets don’t fi t through the mouth “I think it is a new category,” said Ken years ago by BE Innovations. of a standard PET bottle. The tablets must Milligan, executive vice president of Liquid Catapult adds B12 vitamins to also stay in their specially-treated tubes prior Health Labs. “It’s not an RTD, it’s an ‘RTG’ the mix as well, for a hydration to use, or moisture in the air could dissolve (ready-to-go.)” (See our earlier story drink that fi ghts dehydration, them prematurely. And don’t put the tablets on delivery caps, available online at fatigue, muscle pain, and lactic in your mouth, unless you have a sudden BevSpectrum.com) acid build-up. need to appear rabid. Products using that kind of packaging in- Phix Those complications appear surmount- novation are subject to pricing pressures, to Phix, Inc. announced the launch able, as Hicks said Bevology is currently be sure. On the other hand, they are playing of Phix Energy. The all-natural shipping product to Costco – and his in the fast-growing arena of functional- powdered energy drink mix company will likely enjoy limited competi- ity – with enhanced waters the fastest- promotes improved energy and tion in its sub-category for the foreseeable growing part of the category - and there’s mental clarity. It contains green future. Hicks said the brand’s packaging an argument that a packet helps keep those tea anti-oxidants, yerba maté “went through probably 67 changes” before functional ingredients fresher than premixed and NADH. Phix Energy is now they settled on a fi nal design, and the tablets beverages Now, companies are rushing mixes available online at Whole Foods themselves required extensive development into the market. Once relegated to bug juice Markets, Metropolitan Markets to reduce their dissolve-time to three min- and elementary school lemonade stands, and New Seasons Markets in utes. Each new fl avor also requires intense mixes are moving into gym bags and purses. the Northwest. trial and error because the tablets must But are they mainstream? It’s hard to tell, weigh exactly 5.5 grams. especially since some of these products are Açai Daily Drink Packs “Anytime you take something out you moving in the other direction, like Alacer’s Manufactured by Easy Drink have to add something back in,” he said. push to put Emergen-C into an RTD form. Pack LLC of Norcross, Geor- While fi zz-tabs might shun the standard Still, it wouldn’t be doing so without a gia, the açai packs contain a PET bottle, other mixes are putting them- strong powder aisle base from which it could powdered, freeze-dried form of selves right on top of them. Delivery-caps are grow. More mainstream brands are entering the berry’s pulp – without sugar put powders in innovative packages. A hand- the segment, and Alarid, for one, expects all or other additives. The new Açai ful of companies, including Liquid Health major energy drinks to introduce powdered Daily Drink Packs are USDA Labs and Blast Cap Technologies, have versions. Maybe one day soon, everybody certifi ed fully organic produced cap-mounted delivery mechanisms will be able to carry dry versions of their and natural. for drink mixes. Both companies license their v>ÛÀÌiÊ`ÀÊÊÌ iÀÊ«ViÌ°ÊU Zipfi zz Zipfi zz recently expanded

SPORTS DRINK MIX Dollar Sales Change vs. year earlier its distribution channels by adding CVS, Target, Rite Aid CATEGORY TOTAL $66,422,150 31.0% and Odom distributors, and Propel $30,801,850 75.9% announced a new fl avor: Grape. Gatorade $23,413,370 9.4% All Zipfi zz fl avors can be purchased in 20 count boxes and Crystal Light Energy On The Go $6,051,213 39.7% three-packs as powdered- Gatorade Frost $2,791,256 -16.1% fi lled tubes. Capri Sun Sport On The Go $1,079,592 -42.8% Zenergize Private Label $663,846 49.6% Zenergize, originally sold in 10-count tubes, recently added Powerade $657,485 -25.5% 32-count canisters of individu- Gatorade Fierce $334,694 -23.9% ally-wrapped enhanced-water Power Bar $193,218 N/A tablets for national distribution in Costco. Replenish $103,199 132.5% Power Edge $74,515 269.1% Zizzazz Zizzazz energy drink mix recent- 4C Totally Light 2Go $74,294 N/A ly diversifi ed its line to include Gleukos $48,173 43.8% a workout mix, a drink mix for Power Bar Recovery $41,695 94.7% kids (Kidz Zazz), a weight loss mix and a non-caffeinated mix. Power Bar Endurance $36,613 73.8% All ZizZazZ products come in SOURCE: Information Resources Inc. Total food/drug/mass excluding Wal-Mart stick packs. UÊ 34.BEVERAGESPECTRUM.OCT.08

CATEGORY REPORT: BOUTIQUE CSDs BRIDGING THE BRAND NEWS GREAT DIVIDE Jones Soda Jones Soda Co. has announced the launch of BY JEFFREY KLINEMAN its personalized soda, myJones, at Wal-Mart Photo Centers nationwide. By the end of September all 3,400 photo centers will be For years, the divide in the boutique CSD cat- complete and Wal-Mart consumers can up- egory has been easy to trace – it’s the line between load their favorite photo, type a personalized the carbonated juice and the gourmet, old-school message on the label and order a six-pack soda. That’s why Beverage Spectrum divided cover- of myJones at United States based Wal-Mart age this year, letting the Izzes and Fizzy Lizzys stores. Jones Soda is recognized and awarded of the world strut their stuff without having to for its unique labeling that features images wrangle with the Reeds’s and the Maine Roots. generated and submitted by its customers. But apparently soda makers abhor easy defini- MyJones will be available in six flavors: tions, so the gourmet soda group, this year, has Green Apple, Root Beer, Blue Bubblegum, morphed and split once again. The gourmet FuFu Berry, Cream Soda and Sugar-Free stuff remains gourmet stuff – more sugar, Black Cherry. The custom myJones order high end packages, natural sourcing, can be picked up at the store by the Wal- hard-to-beat flavor profiles. Mart customer two to three weeks after But there are also enough new entries under the order is placed. the “healthy soda” rubric that they basically comprise a group of their own: even though Reed’s these products make no pretension about hav- Reed’s Inc. has launched an all-natural ing the wholesomeness of juice are nevertheless diet cola, Virgil’s Diet Real Cola. The new pushing their health benefits forward. They’re flavor is the signature addition to the Virgil’s still sodas, of course, but they’re functional, portfolio of diet, including Virgil’s Diet Root they’re artificially sweetened, and they’re try- Beer, Virgil’s Diet Cream, Black Cherry Diet ing to bridge the divide between the old-school Cream and now, Diet Real Cola. Virgil’s Diet flavor associations of the CSD with the new Real Cola is caffeine-free and gluten free, age idea that a drink can do more. and contains no preservatives or artificial The key piece of leverage to many of these sodas ingredients. Sweetened with Stevia and Xyli- is the experimental sweetener stevia. The idea that tol, all-natural sweeteners, Virgil’s Diet Real a natural diet sweetener might be a game-changer is Cola expands upon Virgil’s Cola, which was a big one. But it’s such a big idea that the Coca- successfully introduced within the main- Cola Co. and PepsiCo are working on stevia-based stream marketplace in March of 2008. products of their own. And the notion that they might want to steal the thunder of independent Maine Root Handcrafted Beverages brands isn’t a flawed one. After all, as functional This summer marked the rollout of three sodas moved into the mainstream, what did they new flavors of Fair Trade Certified Or- launch? Diet Pepsi Maxx and Diet Coke Plus. ganically sweetened sodas: Lemon Lime, It makes the nutritional sell tough for some Mandarin Orange, and Blueberry. Cur- of these guys, to be sure. What’s an indepen- rently, Lemon Lime, Mandarin Orange, and dent operator to do? How about go both Blueberry sodas are available for shipment high-end and enhanced? That’s something that in loose cases of 24; they will be available in both Hank’s and Snow are giving a shot, taking 4-packs the middle of October. Additionally, new flavors and nutrition, mixing them up, and Maine Root’s Ginger Beer cases received an putting them out there. If nothing else, it adds upgrade, and are now available in a stylish a few more vitamins to your shelf set. And then printed mother carton in either loose or 4 there’s Health Cola. pack configuration. Among independents “We’re in the healthy category in a way that on board to sell the entire line are North they used to be,” says Alejandro Lacea, brand Country Naturals out of Brattleboro VT, manager of Health Cola. “No phosphoric acid, Atlantic Importing from Framingham, MA., natural cane sugar It’s for what we don’t have.” Ace Metro Beverage in Long Island, NY, Big

36.BEVERAGESPECTRUM.OCT.08 Sky Beverages in CT, Bradley Distributing in Food & Wine Magazine’s “Best New Chefs the Midwest, Savannah Distributing in GA, in 2006” Jason Wilson of Seattle’s Crush and Greenling in Austin TX. Restaurant. At 60 calories per 12-ounce bottle, DRY Vanilla Bean is aromatic, lightly Wet Planet sweet and delicate without being creamy. Jolt, continuing to straddle the line between DRY Juniper Berry has only 55 calories, and CSD and energy drink, has tagged itself is crisp with a pine essence and high acidity. as “refreshment energy,” or as they put it, As with DRY’s original four flavors, kum- “good tasting energy.” Jolt Energy is avail- quat, lavender, lemongrass and rhubarb, the able in 7 delicious flavors. And this year, in two new flavors are all-natural and sweet- addition to a re-sealable 16 oz. can, Jolt has ened with pure cane sugar. launched three new flavors; Wild Grape, Orange Blast and Passion Fruit. All the fla- Global Beverage Enterprises vors contain a generous dose of stimulating Global Beverage Enterprises has launched ingredients, including with Taurine, Ginseng, Sweet Blossom, which it claims is America’s Guarana, Vitamin B Complex, and Caffeine. first soda made from flower petals. The soda is all natural, pasteurized and made from Snow Beverages flower petal extracts. The sodas contain Snow is introducing a new line of naturally cane sugar, and the line will be featured flavored sodas that are not only fortified on The Food Network’s Unwrapped with with vitamins and antioxidants, but also Marc Summers in December 2008. Another come in popular flavors like Pure Cola and extension of the line is the company’s “Mr. Lemon Lime. Snow Naturally Flavored Q-Cumber” soda. The company is using the Vitamin Sodas will be launched at select east trademark “Stop and Taste the Flowers” in coast retailers in October 2008. Wide scale its advertisements. regional distribution is set to begin in early 2009 with expectations to expand nationally High Voltage Beverages LLC soon thereafter. Snow Naturally Flavored High Voltage Beverages LLC, manufacturer, Vitamin Sodas contain no high fructose corn distributor, and marketer of Volt High Ener- syrup, no caffeine, no preservatives and no gy Electrolyte Replacement Carbonated Soft artificial flavors. Drinks and Sports Drinks, has appointed Cascadia Consulting Group’s Bill Sipper as Zevia President. Sipper has held key management Zevia, made with stevia, is an all-natural positions with brands like Evian, Nantucket sugar-free diet soda “alternative.” Zevia is Nectars, Fresh Samantha, and Naked Juice. made without artificial sweeteners, artificial Volt Carbonated Soft Drinks targets the Mt. colors, and artificial flavors, and also has Dew consumer with a high caffeine, ginseng, no high fructose corn syrup or phosphoric guarana, and taurine enhanced soda with acid. Zevia launched in late 2007 with three a campaign which states, “When Dew flavors: Natural Cola, Natural Orange, and Don’t Do it.” Natural Twist (lemon-lime). In April 2008, Zevia shipped the latest flavor, Natural Gin- Ardea Beverage Comapny ger Root Beer. High profile Zevia retailers Ardea, the creators of Nutrisoda, has an- across the country include Hannaford Super- nounced an expansion into the West Coast markets, Andronico’s, Bristol Farms, Albert- market with its line of nutrient-enhanced, son’s Southern California, QFC (Kroger NW sparkling beverages. The company has en- Division), Haggen-Top Foods, Central Mar- tered into partnerships with several Califor- ket in Texas, Wegman’s, Ukrop’s, and Earth nia distributors, allowing retailers through- Fare. Zevia is available through natural food out the state to meet the needs of consumers distributors UNFI, Nature’s Best, DPI, Tree searching for healthy, sugar-free beverage of Life, and Steiner Foods. alternatives. In Southern California, leading distributors John Lenore Company, GBL Dry Soda Co. Santa Barbara Distributing and Real Soda in For the first time since its inception, DRY Real Bottles are supplying Nutrisoda to the Soda Co. will be unveiling two new flavors market. In Northern California, Nutrisoda this October: Vanilla Bean and Juniper will be distributed through Superior Prod- Berry. DRY’s new soda additions were cre- ucts and Bay Area Distributing. ated with the guidance of acclaimed chef and

OCT.08.BEVERAGESPECTRUM.37 BRAND NEWS: BOUTIQUE CSDs

TeaZazz Drinks are fl avored with the herb stevia, TeaZazz Sparkling Tea announced it has which makes it a healthy and satisfying partnered with 5 Star Beverage Distribution drink for anyone concerned about the health Inc. and Underdog Distributors to bring implications of drinking the loads of sugar TeaZazz Sparkling Tea beverages to San or artifi cial sweeteners most other beverages Diego County and Clark County. Launched contain. Sparka is also enhanced with cal- in 2006 in Valencia, California by Tamara cium and vitamin C. Sparka comes in several Saretsky and Delicia Soliman, TeaZazz Spar- fl avors, including Orange, Lemonade, Peach kling Tea offers the best of both worlds—a and Raspberry. hybrid drink, that bridges the gap between the “fun” of soft drinks and the “good for GuS you” elements of tea. Grown-up Soda completed its summer marketing blitz with its new 5.75 oz. sample- Cricket Cola size cans of Dry Cranberry Lime. Cans were Cricket Natural Beverages has added 3 new distributed in its Northeast and West Coast fl avors to their green tea enhanced sparkling markets via street sampling, events and gift beverages lineup – Pomegranate Raspberry, bags. The 2008 launch of new Dry Cola was Mandarin and White Peach. Complete with a success as placements were gained among 2 cups of green tea in every bottle the entire leading distributors and accounts. Contain- Cricket line is high in antioxidants, deliv- ing real cola nut extract and cane sugar, with ers a mellow caffeine lift without the jitters, only 95 calories per 12 oz., GuS Dry Cola and has a refreshingly delicious taste with was selected among Good Morning Amer- mainstream consumer appeal. Cricket now ica’s “Best 10 Products” from the 180,000 has national distribution in the natural and products offered at the Summer Fancy Food specialty food channels and a national bro- Show. New GuS distributors include DSD ker network to support distribution. Cricket network Real Soda in Real Bottles of CA, has secured placement in many high profi le Marz Beverage of NJ and UNFI/Rainbow retail accounts including Whole Foods, HEB, Foods. Retail expansion continues with The Fresh Market, Jewel Osco and Giant national placement in 240 SuperTarget Eagle. Cricket’s refreshed packaging won De- stores and the Rocky Mountain Region sign USA best packaging award and gained of Whole Foods. Cricket recognition as a “fashion brand” in the beverage industry. Steaz Steaz is going back to school with a big push Carolina Beverage Corp. this fall into colleges and universities across Cheerwine is popping up this year in new the US. The brand, which includes leading cities across the nation with a completely USDA Certifi ed Organic and Fair Trade new look and feel. The iconic 91-year-old Certifi ed Steaz Sparkling Green Teas, Steaz brand has unveiled new branding, packaging Energy, and new Steaz Organic Iced Teaz has and an extensive marketing campaign to sup- gained distribution in over 40 major schools port its aggressive distribution plan. Recent ranging from Princeton to Penn State, UCLA launches in Atlanta and Modesto, Calif., will to Vanderbilt, fi lling the growing demand by be followed soon with rollouts in additional the college community for healthy organic mid-Atlantic and west coast markets before beverage options. the end of the year. Cheerwine is one of the oldest family-owned soft drink companies in Fentimans the country. Carolina Beverage Corporation Fentimans North America will begin produc- – which manufactures Cheerwine – has also ing UK-based Fentimans Botanically Brewed hired top marketing and design fi rms to cre- Beverages in an historic Pennsylvania brew- ate the new identity for the brand which will ery in November. It continues Fentimans’ roll out on all packaging, point of sale, truck time-honored (Est. 1905) recipes employ- backs, and bought media starting in July. ing ginger root, herbs, juices and natural fl avours, fermented and brewed over seven Medicus days to bring out natures goodness. Tradi- Medicus is introducing Sparka, a line of tional sodas including Ginger Beer, Curiosity all-natural zero-calorie sparkling bever- Cola, Victorian Lemonade, Mandarin & ages. Sparka contains no sugar, no artifi cial Seville Orange Jigger, Dandelion & Burdock sweeteners, and no calories. Sparka Natural and Shandy will now be offered in a new

38.BEVERAGESPECTRUM.OCT.08 BRAND NEWS: BOUTIQUE CSDs

4-pack (6/4-pk case), enhancing specialty Red Bull retail distribution. Fentimans’ mixer line of Red Bull Cola was unveiled in Las Vegas in Tonic Water, Ginger Beer and Curiosity Cola June 2008 and is rolling into markets across is offered in 125 ml bottles (24-loose tray) the country starting in October with full giving the brand further appeal in bars, res- national distribution expected in Q1 2009. taurants and hotels. Wholesaler and retailer Red Bull Cola is available in 8.4 oz. cans in inquiries are welcome. bars, restaurants and nightclubs. In grocery and convenience stores, Red Bull Cola is available in 12 oz. cans and 12 oz. 4-packs. Mosse Beverage Industries Mosse Beverage Industries introduced its Thomas Kemper Soda line of Flavored Sparkling Water Beverages Thomas Kemper Cane Sugar Soda will be to New York City in June of 2007 includ- available in single bottles to retailers. Its ing White Grape, Black Grape and Coffee CSDs are sweetened with pure cane sugar flavors. In May of 2008 they introduced a and an added touch of pure Northwest new package design and a new flavor – Black honey. Thomas Kemper’s Cane Sugar Soda Cherry. Mosse can now be found in Whole flavors are complex and rich. Drink slowly Foods stores in New York and New Jersey, and savor the taste. Thomas Kemper’s Cane as well as Central Markets in Texas and Sugar Soda collection comes in five family- independent retailers in 11 other states. friendly flavors: Root Beer, Vanilla Mosse Beverage Industries is currently Cream, Orange Cream, Ginger Ale in negotiations to take the brand to >`Ê >VÊ iÀÀÞ°ÊU national distribution.

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OCT.08.BEVERAGESPECTRUM.39 CATEGORY REPORT: RTD JUICE CAN SUPER- BRAND NEWS PREMIUM Biotta Biotta of Switzerland has announced the formation of Biotta, Inc., a wholly-owned JUICES KEEP subsidiary, to market and sell its line of organic vegetable and fruit juices in the United States. Biotta committed itself to organic GROWING? production in 1951, many years before the enthusiasm for organic food really took BY JEFFREY KLINEMAN hold. Since that time, Biotta has harvested its fruits and vegetables from healthy, living soil. The juices are 100% pure, contain no There’s a real economic moment here for the juice category. For artifi cial additives and are never made from the past fi ve years, the most important growth driver for juices has concentrates. The product line currently in- lay in the produce aisle, where high-end, super-premium juices like cludes the following, with new line additions Odwalla, Naked, Pom, and Bolthouse have led a fresh, health-cen- soon to be introduced for 2009: Beetroot, tered charge into the American shopping cart. Bilberry, Breuss (Vegetable Blend), Carrot, As a corollary to that growth, regular juices and juice drinks have Celery, Sauerkraut and Vegetable Cocktail. been in decline. Nantucket Nectars, Snapple, even Tropicana and Minute Maid have been receding, fi rst buffeted by the non-carb Fuze Atkins diet, then by citrus-crop decimating storms, fi nally by a rising FUZE Beverage will join the Susan G. Ko- tide of variety that has stolen their thunder. men Race for the Cure Series for 2008 and Over the past fi ve years, those high-end juices have grown at about 2009 as a National Series Sponsor and bring 15 percent annually, while regular fruit juices have actually dropped a healthy ‘infuzion’ of positive energy to the a percentage point or two each year. The excitement from the health race series and the breast cancer movement. benefi ts, vibrant fl avors and freshness, interesting new packaging and As part of that sponsorship, FUZE’s mission blended functionalities that include protein and vitamins led consum- of healthy hydration continues with the ers to swallow these drinks higher price points. Shopping patterns launch of FUZE Empower. The drink is a played into those drinks’ increasing popularity, as supermarket shop- Pomegranate Acai Berry fl avored bevearage pers, in particular, continued to spend more time in the produce-rich and will be available in 18.5 fl oz. and 16.9 store perimeter, rather than head for the center store, home of shelf- fl oz. pink plastic bottles. Fuze is proud to stable products like Welch’s. donate $650,000 to Susan G Komen for the But this year, that growth might be subjected to downward fi nan- Cure through this program. cial pressure. Suddenly, the idea of a $4 12 oz. juice might not be so appealing to the coupon-clipping consumer. And those nutritional O.N.E. benefi ts touted by so many of those super-premium products are be- O.N.E. has launched a pair of new juices, ing replicated in other food and drink categories. Coffee Berry and Cashew Fruit, both of Nevertheless, the strongest selling point of that category overall, which are available in 11 oz. Tetra Paks. its seemingly endless novelty and variety, seems to be holding steady. O.N.E. Coffee Berry is 100 percent natural With ingredients like starfruit, coffeeberry, mangosteen, aloe, and and contains a similar amount of caffeine as many others, there’s a powerful, ongoing infl ux of new products onto one cup of green tea. It also is sweet thanks those chilled shelves on the supermarket perimeter. Who knows? to a blend of fresh strawberry and Acerola Perhaps the phrase “at least you still have your health” will continue purees. O.N.E. Coffee Berry retains the nu- to justify shelling out to maintain it. UÊ tritional benefi ts lost in regular coffee when the beans are roasted, namely phenolic acids. Additionally, O.N.E. Cashew Fruit is a 100 percent natural, nutritional beverage with a fresh, light, and naturally sweet tropical fl a- vor. Made from the fruit of the cashew plant, not the nut, this Brazilian fruit is naturally fat-free and packed with Vitamin C. O.N.E. Cashew Fruit also contains important nutrients including beta-carotene, Vitamins B1, B2, & B3, calcium, and iron.

40.BEVERAGESPECTRUM.OCT.08 Old Orchard Brands Fruit 66 Old Orchard Brands has introduced an in- Developed in consultation with school teractive “Fit For Your Lifestyle” campaign nutritionists and foodservice directors for its top-selling Healthy Balance line of from throughout the country, Fruit 66 is a low-sugar fruit juice cocktails. A completely sparkling juice with fewer calories, more redesigned label brings calorie, carb and sug- nutrients and just as many bubbles and taste ar content information prominently to the as traditional cafeteria juices and soft drinks. front of the bottle and an interactive health- Fruit 66 is a patron sponsor of the School focused website (www.healthybalance.com) Nutrition Association and donates a por- encourages dialog with a registered dietician tion of its proceeds to the School Nutrition as well as peer-to-peer discussions among Foundation to improve children’s health and those with sugar restrictive diets. The effort nutrition. An 8 oz. can of Fruit 66 contains is supported by a national ad campaign and 95 calories. It also boasts 100 percent of the a robust sampling program at more than 200 RDA of Vitamin C and 10 percent of the Juvenile Diabetes “Walk for a Cure” events RDA of Calcium, Vitamin A and Folates. across the U.S. this fall. Fruit 66 is available four flavors – Kiwi Strawberry, Fruit Punch, Orange Tangerine Star Power and Apple Berry. Star Power is the first ever pure, premium starfruit juice. In a new initiative from the Glow Mama founders, Star Power has started giving Glow Mama is leading the new maternity complimentary cases and sponsoring events nutrition category with a ready-to-drink to good charities. For a recent benefit, all natural kiwi juice. Fortified with folic proceeds from cocktails went to supporting acid and other essential pre and post natal the Orphans’ Fund of 9/11. Star Power is vitamins, Glow Mama is approved by the now available at many of the more expensive American Pregnancy Association for the retailers in and around NYC. important job of hydrating new moms and moms-to-be. With four grams of soluble ALO fiber per 12 oz. bottle and only 70 calories, ALO has announced the addition of two Glow Mama uses kiwifruit juice concentrate new flavors to its line of alternative drink imported from New Zealand. Glow Mama is blends infused with real aloe vera pulp. ALO launching in West Coast natural grocery and Enliven crams all the good stuff from 12 maternity stores. fruits and vegetables with real aloe vera pulp for an energizing, healthy drink alternative. Firefly Tonics ALO Elated combines aloe vera with brewed Firefly has created a tonic to raise the spirits. olive leaf tea, which is rich in anti-oxidants “Recharge” combines antioxidant-packed and a good source of energy, to provide a juices with herbal extracts to boost the unique, superior drink alternative for the body’s credit-rating and raise the spirits. It’s green tea crowd. ALO drinks are available refreshing, delicious, and comes in a swanky in a 500mL as well as a 1.5L bottle and silver bottle – because “life’s all about silver are shelf stable. linings.” Recharge contains fruit juices (white grape, pomegranate, plum, blood Essential Beverages orange, rosehip), with botanical extracts Essential Beverages makes Alo Juice into and natural flavourings. No added sugar, seven flavors: Mango, Pomegranate, Kiwi, nothing artificial. Grape, Cherry, Mixfruits, and Original. It has real bits of Aloe Vera and no added Simply Orange sugar. Most people know about Aloe Vera Simply Orange Juice Company has launched for its remarkable health-enhancing proper- two new premium orange juice blends, ties for external application to the skin, but Simply Orange with Mango and Simply Aloe Vera is also packed with Vitamins, Orange with Pineapple. Launched August Minerals, Enzymes, and Amino Acids to 18, both are packaged in the 59 oz. clear boost energy and maintain proper immune Simply carafe, and are available in super- function while supporting a healthy markets nationwide. Simply Orange with digestive system. Mango combines orange juice with the unique sweetness of mango, while Simply Orange with Pineapple couples orange juice

OCT.08.BEVERAGESPECTRUM.41 BRAND NEWS: RTD JUICE with luscious pineapple. The juices are never ing artificial. It also comes in a convenient, concentrated, never sweetened, and made reusable, spill-proof sippy-top container. It with only natural ingredients. has BPA-free packaging, organic and reduced sugar attributes, and nutritional value and NBI Juiceworks convenience. First Juice is currently avail- NBI Juiceworks’ Drenchers has a new all able in two flavors: Apple+Carrot and natural 100 percent super juice, Heart Banana+Carrot. Healthy. Heart Healthy has no fat, no cho- lesterol, no sugar or preservatives added and Zola Acai is fortified with key vitamins and minerals Zola Açaí is having a record-breaking year, specifically designed for heart health. Each selling more in the first six months of 2008 eight ounce serving of Heart Healthy has than in all of 2007. Earlier this year, Zola in- only 120 calories and contains two servings troduced its line of Açaí Superfruit Juices in of fruits and vegetables. Available in shelf new re-sealable and recyclable bottles. Since stable 64 oz. sizes, Drenchers Heart Healthy the introduction of the new bottle, Zola has all natural 100 percent super juice contains been authorized in 10,000 stores nationwide. Bodyguard, a fortification package of 15- Zola’s authentic Brazilian recipe uses 100 plus essential vitamins, nutrients, amino percent unfiltered pulp from hand-harvested acids, electrolytes and herbs. organic Açaí berries to deliver superior taste, while use of proprietary processing technol- Sence ogy ensures maximum retention of nutrients. SENCE Rare European Rose Nectar has launched into several international markets Skylarhaley as well as a great many more outlets in Skylarhaley has unveiled the newest flavor in the USA. Now found throughout Canada, its award winning line of essn beverages— France, Japan, Taiwan, Korea, Poland, sparkling mango and passion fruit juice. A Scandinavia, Australia and New Zealand, blend of sweet and tropical essence, the 100 SENCE will expand its operations further percent juice drink is packed with natural into Central and South America, China, flavor and contains no preservatives, ad- Singapore, Hong Kong and Macau by the ditives, or artificial sweeteners. The juice end of Q4 2009. fuses the taste of ripened mango and the tartness of passion fruit. essn is the nation’s Envy first all-natural sparkling juice beverage that Envy is an all-natural 100 percent premium combines the pure essence of exotic fruits fruit juice packed with a little fizz. Each with a light effervescence. can provides vitamins A,C,D and Calcium, and is all-natural. Envy is available now is Embodi a lineup of five flavors including Acai Berry, Embodi, the first natural, non-alcoholic juice Fuji Apple, Fruit Punch, Tropical Mango, blend beverage to provide the health benefits and Strawberry. These could very well be the of red wine, becomes available nationwide best tasting alternative to sodas and energy in the natural and specialty grocery channels drinks yet! this month. Originally introduced in Whole Foods Market stores nationally in June Uncle Matt’s 2008, Embodi has expanded its distribution Uncle Matt’s Fresh, the organic produce and will also be available in Mrs. Green’s “arm” of Uncle Matt’s Organic, has an- Natural Market, Fairway Market, and West- nounced that the number of organic citrus erly Natural Market amongst many other growers and the amount of acreage dedi- natural and specialty grocery stores. Embodi cated to organic citrus that their company beverages are made from a specially devel- manages, is rising at a steady and healthy oped grape pomace extract made from the pace. The company is growing organic or- skins, seeds, and stems of red wine grapes. anges, tangerines and grapefruit for its own This extract is combined with organic juices juice brand, Uncle Matt’s Organic, along and provides Embodi with the full-spectrum with providing organic fresh citrus for Uncle of red wine’s antioxidants – and resulting Matt’s Fresh. health benefits – without the side effects of alcohol. First Juice First Juice organic fruit and vegetable juice Orchid Island beverage is the first juice for toddlers that Cook’s Illustrated, the nation’s prestigious is significantly lower in sugar and calories publication dedicated to evaluating cooking than traditional juice offerings, with noth- products, recently completed a thorough

42.BEVERAGESPECTRUM.OCT.08 taste test of ﬁve nationally recognized brands Odwalla and one family owned brand of orange juice As part of its ongoing commitment to against freshly squeezed juice made from consumers and to Mother Earth, Odwalla oranges in its test kitchen. The results – kicked off a unique partnership this summer Natalie’s Orchid Island Juice Company’s with state parks in select markets across the Gourmet Pasteurized Orange Juice beat the country. Through the Odwalla Plant a Tree competition hands down and was rated program, outdoor enthusiasts were invited the best tasting. The magazine conducted to visit parkvisitor.com and donate trees to taste tests and independent laboratory tests their preferred state. More than 60,000 trees to judge the juice closest to fresh squeezed will be planted through the 2008 program. orange juice. Cook’s Illustrated testers calcu- Due to its overwhelming success, the Plant a lated, buying and squeezing oranges at home Tree program will be expanded in 2009. made the cost 23 cents per ounce – about three times the price of the winning Natalie’s Genesis Orchid Island Juice Company’s juice. Genesis BOOST has launched a new line of refrigerated, ready-to-drink superfruit Sambazon juices to meet the growing demands from Sambazon is expanding its award winning health conscious consumers everywhere. The line of single serve Açaí juices by offering blended exotic fruit juices, which are all- family sized versions of their best selling natural, with no preservatives, added sugar skus. The convenient 32 oz. bottles come in or sweeteners, are made of superfruits grown two great tasting ﬂavors: “Original Blend” on wild-harvested farms in the Amazon (Açaí lightly sweetened with pure agave) Rainforest, French Polynesia, Southeast Asia and “Antioxidant Trinity” (Açaí with and other pristine regions around the world. blueberry and pomegranate for a triple BOOST Superfruit Juices come in a 12 oz. antioxidant boost). glass bottle and are available in four blended varieties: Beauty Boost, Youth Boost, Happy ÃÌ]Ê>`ÊiÀÊ ÃÌ°ÊÊU

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At Sovereign Flavors, “Energizing” the new age beverage category is crucial for our beverage partners. From ‘Conceptualization to Realization’, Sovereign Flavors is with you every step of the way. With over 40 years of beverage application experience to extract upon, our beverage staff is poised to develop your ‘Energy’ drink that meets your specifi c requirements. Sovereign Flavors understands that fi nding great fl avor solutions and speed of response is critical-and we pledge to be there from start to fi nish. It’s our promise. Our Sovereign Promise.

phone. 714-437-1996 www.sovereignﬂ avors.net

OCT.08.BEVERAGESPECTRUM.43 CATEGORY REPORT: DIET ENERGY THERE’S BRAND NEWS ALWAYS DIET HER Enterprises, Inc. Her - an energy drink with women in mind - is BY JEFFREY KLINEMAN now available in 12-packs and 4-packs, and has gained distribution at Kowalski stores in Minne- sota and Wisconsin. We’re not all Michael Phelps. While a quick glance at the The CL-ONE Corporation lack of Speedo is, possibly, the YOUR CL-ONE recently added the 8.3 oz. ‘Sugar Free’ PHOTO leading indicator of that par- HERE to its line-up, and the product will be available ticular insight, on paper, one in 15 states including California, New Jersey thing we occasionally do have and Minnesota. in common with the Olympic medalist is our Olympian The Healthy Beverage Company energy drink consumption. Promoted this summer with bicycle and skate- While we don’t do it every day, board giveaways at Whole Foods, Diet Steaz is for sure, on occasion, we’ve all both organic and fair trade certified. consumed about 1,000 calories of energy drinks. (Although Hoborama LLC Phelps did it – gasp – BAWLS Guarana is now the official energy twice a day). drink of the National Bicycle League and the Still, it doesn’t necessarily American Bicycle Association. This summer, take a couple of Big Gulps of BAWLS launched a BAWLS BMX Contest. Five Venom or Rockstar to cross into percent of the proceeds of every BMX can sold Phelps territory. With many 16-ouncers coming in near 350 or will be donated to the NBL and to the ABA to 400 calories, it isn’t too much of a stretch to imagine the gold support the building of new BMX tracks and medalist – and his now-famous 12,000-calorie per day training racer sponsorship programs. diet – getting matched sip for sip by some of the country’s most average desk jockeys. Elite FX Of course, those desk jockeys aren’t really hitting the lanes as Celsius recently launched Green Tea Calorie much as Phelps, and that probably accounts for the continued Burners. Celsius Green Tea Peach Mango and popularity and growth of the diet energy subcategory. We all need Celsius Green Tea Raspberry Acai offer the the energy, but the dedicated energy drink consumer is coming to same benefits as sparkling Celsius. Each can understand that their fuel of choice need not carry the extra calories. burns up to 100 calories or more by raising The overall energy category remains strong – up 29 percent last metabolism over a 3-hour period, generating year, according to Beverage Marketing Corp. – but with obesity con- increased energy and alertness. cerns a constant drumbeat, reduced-calorie products may be the key to keeping things growing. While most new brands are not coming Source Beverages to market without a zero-calorie, artificially sweetened sub-brand, Sugar-Free BURN has been selling extremely there’s more going on than just the usual aspartame/Ace K mix. well online, on par with original BURN, Monster and Rockstar are trying to keep calories down by throwing providing customers outside of the brand’s artificial sweeteners into their full-calorie energy juice blends. The distribution areas with an easy and majority of energy shots are also made without sugar, the main calo- convenient way to get home-delivery. rie culprit, and those that aren’t are so small that the count is well More info at www.burnenergydrink.com. under 100. That indicates that reduced-calorie is growing in lockstep with zero calorie. Witness that recently the newly-formed Dr Pepper Whey UP Snapple Group added a stake in Hydrive, an “energy water” that has WheyUP, the Original Protein Drink with En- minimal calories but still features some sugar in the mix. ergy, announced that the company is introduc- So if there’s no clear winner in the race to find the perfect diet ing a new flavor, Grape Punch. energy drink, remember – there’s always going to be a diet (or, at 17 percent of the category, a diet or TWO) in the mix. Slump Buster Energy Unless you’re training for, like, 19 big races. U Slump Buster recently launched their sugar free variant, Youk’s Signature with an image of Red PHOTO BY SPEEDO Sox first baseman Kevin Youkilis on the front of the can. With zero carbs, MBSB Holdings pledg- es to donate a portion of proceeds to Kevin Youkilis Hits For Kids charitable organization. 44.BEVERAGESPECTRUM.OCT.08 XO-2 Energy Beverage Corp. The new, reformulated XO-2 boasts a 20-24 month shelf life. XO is best consumed at room temperature giving consumers choices of drier, sweeter and more aromatic blends.

Fluid Motion Beverage Inc. Fluid Motion Beverage launched in August a new sugar-free line extension to its Vixen Energy brand: Vixen Fox Lemonade. The Vixen Fox Lemonade is a pink sparkling lemonade sweetened with Splenda (Sucralose) and Ace K.

Fuze Beverage, LLC Available in Sugar-free 16oz cans, NOS can be found nationally in speed shops, grocery and convenience stores. NOS combines ingredients like Taurine, Caffeine and Ginseng to ensure extreme performance.

Ardea Beverage Nutrisoda recently released ﬁ ve of their most popular varieties - including Energize in 12 oz. glass bottles. With Taurine to help recharge, Energize is packed with 10 mg of the nutrient CoQ10 and the amino acids L-Tyrosine and L-Carnitine, herbs such as Ginseng and Guara- na seed extract combined with B-Vitamins, and Magnesium.

Power Trip Beverages, Inc. Power Trip “0” diet energy beverage boasts great taste and no sugar, no HFCS and no carbs.

Wet Planet Beverages Jolt Ultra: Sugar Free is now available in 16 oz. resealable aluminum cap cans.

Ronin, LLC Ronin Positive Liquid Synergy, the sugar free alternative to original Ronin, now enjoys direct store distribution in Wisconsin, Minnesota in Northern Illinois as that company has 350 trucks at its disposal.

Nutrition Resource Services, Inc. Krank’d 7-in-1 Body Fuel will be available in 16.9 oz. plastic bottles with a new look. At 37 calories per serving, Krank’d will initially be available in three ﬂ avors in the plastic, followed with the production of other popular ﬂ avors and a unique new line of teas.

Brain-Twist, Inc. Slap had a heavy summer marketing & promotional calendar: we including radio spots during Mets games, and sponsorship and sampling at many NY area concerts; handball tournaments, Summerball basketball tournaments, the LI Balloon Festival and Village Voice Siren Musical festival. OCT.08.BEVERAGESPECTRUM.45 CONVENTION SCRAPBOOK NACS BY JEFFREY KLINEMAN

The 2008 NACS Show took place at McCormick Place in Chicago from October 4-7, showcasing over 100 beverage companies and their brands. Energy Shots, Enhanced Waters, and a great many supplement/drink hybrids were all well- represented. BevNET’s intrepid Greg Wilson and Co., product-spotting representin' for Redline. Muscle Milk: drink it and get muscles! team picked up the following new product developments: UÊÊ iÀ}ÞÊ- ÌÃÊvÀÊ All Day Energy; AMP; Alpha Phar- maceuticals; Intocell; Met-RX; Purple Stuff; AriZona; Shotz and NR-GIZE UÊÊ`ÃÊ iÛiÀ>}iÃÊvÀÊ In Zone and ZizZazz UÊÊ iÜÊ vviiÃÊ>`Ê/i>ÃÊ from Bustelo Cool, iCafe, and Xing Tea Give's Ben Lewis and Mark Slepak, UÊÊ iÀ}ÞÊ ÀÃÊvÀÊ 5-Hour's Brandon Bohland, giving their all. Body Well Nutri- standing so long he had sore feet. tion, Go Fast, Ole, Redneck Punch and Sex Drive UÊÊ*Ü`iÀÃÊ>`ÊââÌ>LÃÊ from Ephrine Plus and Peptime Energy, Guava Rush, and Wake-Up Call UÊÊÕViÃÊvÀÊ ÃÃiÌ>Ê Aloe Juice, Nu South, UÊÊ-«ÀÌÃÊ ÀÃÊvÀÊ H.A.R.D. Nutrition, H7, Labrada, S-250, Sport Wave, and VPX Labrada Nutrition, fit as heck! The Cocio crew. Sports UÊÊ - ÃÊvÀÊi>Ì Ê Cola and Jones Soda UÊÊ7>ÌiÀÃÊ>`ÊÕVÌ al Waters from Goya Foods, Jana Water, Sparkletts, VBlast and Vitamin + Fiber Water

Hard Nutrition's Richard Pearce Campbell's John Drohan with a and Kenna Doschler. little thing he likes to call v8. 46.BEVERAGESPECTRUM.OCT.08 + * ! ! ( ! % ' * & & +, ! -+ "##$ %& ) ' ' ! %2 .## & ! "!# 3 ! & # $ # % 0 1 ! !"" #$$ & / 4 % % ' %

! "#$%&' "&&# ( ' )* PROMO PARADE

DOS EQUIS LAUNCHES CROWN ENCOURAGES VARIETY SHOW TOUR PAIRING FOOD WITH BEER Dos Equis launched “The Most Interesting Crown Imports’ “Beer Kitchen” program Show in the World Tour,” an upscale, offbeat runs in off-premise accounts in September variety show and tour inspired by the award- and October 2008, and draws on the popu- winning The Most Interesting Man in the lar trend of pairing beer with food. World campaign. The MISW tour features “Beer Kitchen” features “The Art of performers from around the world, including Cooking and Pairing Food With Beer” recipe aerial performers, Japanese robotic dancers, booklet, which offers recipes and beer pair- acrobats, fi re jugglers, Russian dancers and ing ideas that complement the Crown Im- French burlesque singers, to create a show ports portfolio of premium imported beers. experience worthy of its name. To supplement to program, the Crown The MISW made its fi rst tour stop on Oct. portfolio has teamed up with food partners 8 in San Diego and the show’s dazzling array to offer coupons and encourage incremental of performers will travel to 14 cities across grocery sales. the country, including Los Angeles, Chicago “Beer Kitchen” easel cards with booklet and Austin. The incomparable Jim Rose, holder are available to attract consumers to famed emcee of the “The Jim Rose Circus” Crown Imports Beer displays. sideshow and a man well-known for his own eccentricities, will serve as the host. The MISW is written and produced by Randy Weiner and New York-based Weiner FANS TO CHOOSE THE NEXT ST. PAULI GIRL Entertainment Group. Weiner, creator of “The Donkey Show” and “Beacher’s Mad- Fans will have their say in choosing the St. Pauli Girl spokesmodel that the beer house,” is a managing partner of The Box, St. Pauli Girl for the fi rst time ever. St. has opened the selection process to the one of New York City’s hottest performance Pauli Girl, the No. 2 selling German public and will let fans actually select venues. beer in the U.S., has partnered with the St. Pauli Girl. The MISW tour will be supported by nation- Maxim Magazine to give more access to Each of the fi nalists participated in a al and local print, radio, as well as regional the St. Pauli Girl selection process, al- preliminary photo shoot and fans will in-market promotions. lowing fans to vote for the new German judge each fi nalist on her test shots and barmaid spokesmodel. how well each represents the spirit of Fans will choose from four fi nalists St. Pauli Girl as the next spokesmodel. who each bring the St. Pauli Girl bar- Voting will run through November 10, maid to life in her own way, online at 2008 and the new St. Pauli Girl spokes- maxim.com/stpauligirl. This marks the model will be announced in January fi rst time in the 31-year history of the 2009.

48.BEVERAGESPECTRUM.OCT.08 Beverage Spectrum covers new beverage products, as well as the marketing, packaging, and ingredient innovation trends behind those JULY – AUGUST 2008 products. From the largest beverage marketers to regional distributors BIG CHANGE

COMES TO BREAKING SEPTEMBER 22, 2008 to the smallest corner stores, the beverage business is at its core about OUT BIG TEAMuscle Milk selling drinks. Beverage Spectrum is the guide for those who both sell leaps from the ALSO THIS ISSUE: supplement FMI REVIEW aisle to the them and create them. BRANDS IN TRANSITION corner store GUIDE 2008 ALSO THIS ISSUE: ENERGYCOMPLETE DRINKOVER LISTINGS 200 BRANDS FOR Subscribe now and get 8 issues of the most comprehensive product NACS Show Preview Expo East Preview Sports Drinks Import Beer focused magazine available! Crunchy Beverages

2008 WATERWelcome GUIDE to ENCLOSED the New Beverage Spectrum

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I wish to receive Beverage Spectrum free of charge: Yes! No 3. What is your primary business type? (check only one) I’d like to receive my subscription in the following format: A Convenience Store B Supermarket/Grocery Print (USA only) Digital Print and Digital (USA only) C Club/Warehouse D Mass Merchandiser/Dollar Please complete all information requested on this form and fax today! E Drug Store Signature F Liquor Store G Wine Store Date H Wholesaler/Distributor/Broker Name I Beverage Only/Beverage Specialty Store J Beverage Company Title K Supplier Company Company L Services Company Address X Other (please describe) 4. What is your title? (check only one) City State Zip Code A Owner/President/CEO/COO/VP/Director B Buyer Phone Fax C Bottled Water E-mail D Regional/District Manager E Store Manager/Supervisor Please list a colleague at your location who should also receive a FREE subscription. X Other (please describe) Name 5. Do the locations that you are Title responsible for sell: (check all that apply) A Carbonated soft drinks 1. Do you buy or inﬂuence the buying of beverages? B Non-carbonated soft drinks Yes No C Bottled water D Beer 2. Would you like to receive our weekly new product email newsletter? E Wine Yes No F Liquor PROMO PARADE

HOLIDAY AMSTEL LIGHT (AND TURKEYS) Amstel Light announced a new Thanksgiving program called “Your PROMOTIONS Holiday, Your Twist” that offers consumers and retailers solutions and opportunities around the festive holiday. BEAM GIFTS The brand is offering a tiered Mail-in Rebate (MIR) (where legal) Beam Global Spirits & Wine, Inc. of- to consumers at grocery, drug and retail outlets during the month of fers consumers gift ideas and recipes this November as consumers are stocking up for Thanksgiving. Consum- upcoming holiday season with off-premise ers will be offered a MIR with the purchase of fl owers and/or turkey programming that includes holiday-themed and 12-packs of Amstel Light. MIR tear pads will be available on packaging and point-of-sale displays. Festive in-section and out-of-section displays and will include instructions holiday packaging, recipes and point-of-sale along with recipes including fried turkey, couscous stuffi ng and materials help make the holiday entertaining praline pumpkin pie to help consumers put a personal twist on the and gifting season easier for legal purchase standard holiday fare. Amstel Light fl ower wrap bags will also be age consumers. available to help consumers dress up their fl oral gifts. To help support the execution of the Amstel Light “Your Twist, COURVOISIER COGNAC is offering a Cour- Your Holiday” Thanksgiving program, Amstel Light is providing a voisier XO Imperial gift set, which includes range of POS and display materials that will make it easy for retailers a 750 ml bottle with a backgammon set to merchandise the program. Mega-display units, case cards, base enclosed in a collector’s wooden box. 750 wrap, dual-function tuck-ins and decals will be available to get shop- ml bottles of Courvoisier VS comes with two pers attention while they peruse the beer aisle, butcher section or stem-less Courvoisier-branded glasses and pass through the fl oral department. recipes on the back of the gift set. Finally 750 ml bottles of Courvoisier VSOP come packaged with a Courvoisier-branded shaker.

JIM BEAM offers consumers a holiday gift carton with the purchase of a 750 ml bottle.

KNOB CREEK BOURBON will have a custom label available during special in-store promotions. Consumers can have a customized message printed onto this holiday-themed label.

ABSINTHE-MINDED HOLIDAY HORNITOS TEQUILA commemorates the holidays with a gift pack that includes a 750 GRANDE ABSENTE ml bottle of Hornitos Reposado Tequila ac- Grande Absente, Absinthe Originale, is available in a unique holiday companied by a ﬂ ask and recipes. Hornitos gift pack. The holiday gift pack includes a 750 ml bottle of Grande is also utilizing holiday-themed danglers, Absente, a signature hand crafted and painted cocktail glass and a case cards, table tents and napkins. one-of-a-kind absinthe spoon. Each glass is painted with the green fairy amongst the wormwood plant from which Grande Absente is CANADIAN CLUB treats consumers to a holi- made. day gift carton along with a “Damn Right Grande Absente, Absinthe Originale is now available nationwide Your Dad Drank It” 2009 calendar mail-in for the retail price of $70. offer, pole topper and display. LUCID MAKER’S MARK BOURBON offers consumers Viridian Spirits LLC, the owners Maker’s Mark in a holiday-themed gift box. and importers of Lucid Absinthe Su- Point-of-sale displays, including pole top- périeure, released a limited edition pers, case cards and shelf talkers, round out Holiday Gift Set. The set includes holiday programming for the brand. one 750 ml bottle of Lucid, two vintage style absinthe glasses and one STARBUCKS LIQUEURS will help consumers vintage style absinthe spoon. warm up this winter with a 750 ml bottle of The holiday gift set will be either Starbucks Coffee Liqueur or Starbucks available at high end liquor stores Cream Liqueur and a Starbucks branded nationwide for a suggested retail coffee mug. price of $59.99.

50.BEVERAGESPECTRUM.OCT.08 Keep beer drinkers trading up to craft with

The best selling craft beer style variety

7 beer styles ranked in the top 50 craft sku’s.(1)

Drove 30% of all craft growth in the past year. (1)

Drives more trade up to craft than any other brand.(2)

(1) IRI, Total US, Food (2) BBC Usage & Attitude Study