Beer Marketer's Insights - As Acquisition Rumblings Swirl, Olipop Must Defend Lawsuit Over Nutritionals; Charged with Purveying 'Basically Sugared Water'

As new year gets under way, most prominent bev acquisition target seems to be Olipop, fast-growing gut pop brand that would give Coca-Cola or another strategic a weapon with which to counter Pepsi's acquired Poppi brand and Keurig Dr Pepper's Bloom Pop brand launched via its strategic partner Nutrabolt. But strategics don't enjoy getting ensnared in legal odysseys, as reflected by Poppi's move to pay $8.9 mil to settle class action suit before PEP pickup could happen (BBI, Mar 19). So suit filed vs Olipop a coupla weeks ago in NY could serve as a speed bump if a deal really is in the works. KO is viewed as likeliest suitor because so far it's playing in segment with Simply Pop extension of its juice brand that many view as just a placeholder. Recall PEP undertook similar strategy with plan to launch its own entry under SoulBoost brand before pivoting to Poppi deal. Lawsuit seeking class action status that was filed in federal court for Eastern District of NY on behalf of consumer named Jordan Somers contends that Olipop's 6-9 g of fiber is insufficient to provide meaningful benefit given some studies that show 12 g is minimal daily threshold for efficacy. "Thus, in order to reap the benefits of prebiotics, consumers would have to drink at least two of the products every day for a month," suit says, as reported by Top Class Actions site. Suit also takes aim at brand's sugar content, up to 5 g per can, which plaintiff argues would negate any potential benefits from the prebiotics if consumed at rate of 2 cans per day. Suit cites nutritionist terming the soda "basically sugared water." Suit vs Olipop was brought by class action specialist Arisohn LLC.News of the suit could prove jarring to some consumers given the effort Olipop has made over its 8-year history to argue that its refrigerated recipe boasts more credible gut-pop formula than its shelf-stable rivals, backed by clinical studies. That distinction was muddied a bit over past year as Olipop added its own shelf-stable subline as way to better penetrate channels like c-stores and to generate the types of floor displays that have been a key component of Poppi's brilliant in-store execution. While core line contains 9 g of fiber via brand's proprietary Olismart formula of cassava root fiber, chicory root inulin, Jerusalem artichoke inulin, nopal cactus, marshmallow root, calendula flower and kudzu root, the shelf-stable subline contains lower amount of fiber.Several puts & takes on Olipop as acquisition bait. On negative side, until recently it went out only as refrigerated item, insisting that shelf-stable rivals were making compromises that hindered their efficacy. But cold chain has stigma these days among strategics and in past year Olipop launched that shelf-stable extension that to some eyes clouded its claims of superior functionality. On plus side, it hasn't enlisted meaningful DSD distribution, meaning few buyouts will be necessary by would-be acquirer, unlike the case with Poppi with its national footprint of mainly beer houses. Also in Olipop's favor: if strategic like KO is in the hunt, there are no other non-aligned brands of comparable scale, tho segment is populated by smaller players like Culture Pop, Cove Soda and others that have been making their mark.

As Acquisition Rumblings Swirl, Olipop Must Defend Lawsuit Over Nutritionals; Charged with Purveying 'Basically Sugared Water'

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