As first HPP-processed coconut water, Harmless Harvest has been revelation to category, recording brisk growth at elevated price point to legion of fanatical repeat buyers who sometimes buy it by the case.  Amid regulatory confusion and class-action threats over use by marketers of term “raw,” tho, co has decided to drop phrase from its packages, opting instead for more vague “Harmless Coconut” as identifier.  Whether that exacts cost in consumer interest in brand remains to be seen, tho co has taken to social media to emphasize that there have been no compromises to exacting way product is created.  Meanwhile, word on street has been that co may be contending with other challenges, too.

Earlier this summer, co appeared to suffer extended period in core NY market where inventory was short and retail out-of-stocks more frequent.  And, in development that may or may not be related, BBI has been hearing rumblings that Food & Drug Administration, which over past year has been expressing concern that HPP in itself may not be sufficient to eliminate microorganisms from low-acid food items like coconut water, has been barring or delaying arrival of some Thailand-sourced Harmless Harvest products, tho contacts have variously cited Calif and Southeast.  We haven’t been able to confirm any clampdown so far but reports have been persistent over period of several months.  Asked at recent Fancy Food Show in NY about shortages and possible FDA issue, one Harmless Harvest exec first said he wasn’t aware of any issues, then added that any problems have “been resolved,” and said no other co staffers would be willing to discuss matter.  Exec at brand’s NY distributor, Dora’s, said only that inventories have been improving lately.  More as we hear it.

As for packaging change, which was revealed via Fri blog post from co that was picked up yesterday by BevNet.com, co has been emphatic on social media that “our organic Harmless Coconut Water will still have the same high quality and extraordinary taste,” sourced from sustainably farmed organic Nam Hom coconuts from Thailand and remaining “a non heat-pasteurized product.”  

SodaStream is about to put its radically revamped we’re-not-soda-any-more strategy to the test, with first sparkling-water flavors hitting 950 US stores of core retailer Bed, Bath & Beyond this Fri and rolling out to other channels next month. 

SODA ceo Daniel Birnbaum used occasion of 2d qtr earnings call this morning to review progress toward repositioning co not as home soda maker but facilitator of “Sparkling water made by you,” naturally colored and flavored, with lower calories thanks to use of fructose or stevia/monk fruit combo.  First ads, digital media and pr push began in NY, SF and Seattle last month, exhorting consumers to “Be a sparkling water maker,” followed this past weekend by first TV spot in NY, testing personalization and empowerment message “Factory of One” (BBI, Jul 31).  With household penetration of its machines at just 1.5% in US, there’s ample room to grow to reach levels co enjoys in overseas markets ranging from 5% to beyond 20%, ceo argued – if it can finally get the products and messaging right. 

After debuting at Bed, Bath & Beyond late this week, about a week behind schedule, Birnbaum acknowledged, new flavors next month hit Target, grocers and specialty retailers.  To recruit other retailers, brand for first time will exhibit at Natural Products Expo East in Baltimore in Sep.  Co is hoping to bring on drug and c-store chains for gas canister refills, and will also commence home delivery in US by end of year, mimicking approach in overseas markets.  As reported, new flavors are launching in 5 groups – Fruits, Zeros, Plus (fortified with minerals/vitamins), Essence and Gourmet (via flavors like Cucumber Apple and Lime Basil that target foodies and cocktail aficionados).  SODA also continues to solicit interest from branded players, in both cold and hot bevs (for next-gen machine), these days with heavier emphasis on non-CSD categories.  No word on conference call on status of Pepsi test in Fla but co is not exiting CSD segment entirely.

New flavors already are on shelves in home market Israel, with S Africa and UK also slated for first wave.  Next stage will bring new flavors to Nordic countries, France, Benelux countries and New Zealand.  Final cutover comprises Germany, Switzerland and Austria, co’s strongest markets, where sparkling water has always been emphasized over soda syrups and household penetration continues to increase.  (Revenues surged 42% in Germany on constant-currency basis in latest qtr.)  SODA currently has capacity in Levahim, Israel, plant to meet half its anticipated needs and is building capacity rapidly, Birnbaum indicated.

Birnbaum also offered glimpse of development pipeline on equipment side.  Next-generation Ultimate machine creates both hot and cold bevs, includes Internet interface, and produces not just single-serve drinks but can employ pouches to create batches of 20 servings, at cost as low as 10 cents per serving.  That will put SODA squarely in competition with Keurig Green Mountain, which reports its quarterly earnings later today.  And The Mix carbonates any liquid.  Both are aiming for 2d half of 2016 for debuts.

As for Q2 itself, that “played out as we expected,” Birnbaum said, and while shares opened soft, by mid-day they’d returned to range of yesterday’s close at $17.27.  New strategy had been announced last Oct and Birnbaum has advised Wall Street that interim results would inevitably be soft as co rationalizes store footprint, pulls marketing spend and preps for restage.  Sales in Q2 plunged 28% to $141.2 mil, with W Europe off 16% to $77.7 mil and Americas off 44% to $40.9 mil.  Foreign currency hit exacerbated trends to tune of $16.9 mil.  By product category, the appliances (“starter kits”) were off 37% to 491K units and syrups off 45% to 5.1 mil units but gas refills rose 7% to record-high 6.9 mil units – reassuring “testament to our consumers’ loyalty to our system and our products,” Birnbaum said.  Operating income fell 60% to $4.5 mil.

In US, machines came in at 48K units, about flat with Q1, and syrups 860K units.  Gas refills came in at 1.2 mil units, up 7% from prior qtr tho slightly down from year-earlier.  US revenue hit of 42% reflected in part exit from Walmart; all told, co has dropped 3,900 retail doors, leaving it in about 13K stores. 

Tho Birnbaum announced hiring of global marketing vp and global pr mgr on this morning’s call, nothing was said on status of search for new N Amer chief, tho BBI hears co has been interviewing considerable # of candidates in recent months.   

So-called Third Wave of coffee enlightenment continues to pull in more major coffee chains.  Latest aboard is venerable LA-based Coffee Bean & Tea Leaf, which this week is intro’ing selection of single-origin organic coffees at some locations.  Initial group includes light roast from Peru, medium roast from Mexico and dark roast from Sumatra.  The new coffees, which are available in store and in whole beans for takehome, are sourced from farms and estates spanning 3 continents and roasted in Camarillo, Calif . . . Fiji Water has added 700-ml bottle size to its packaging mix, first new bottle for brand in close to a decade.  New pack retains brand’s iconic square footprint but fits into car bottle holders and other on-the-go locations.  SRP is $2.29.  It comes amidst spurt of activity behind brand, including first TV campaign and radical label redesign . . . Cleveland-based Garden of Flavor has intro’d what it says is first USDA-certified, organic, cold-pressed tomato juice on market, Tomato Tonic line that boasts presence of living probiotic cultures.  Tomato Tonic is formulated from blend of fresh tomatoes, garlic, jalapeno and cilantro, along with GanedenBC30 probiotic cultures.  Each 16-oz bottle is claimed to provide 4 servings of vegetables. 

Americans may have developed a raging thirst for bitter beers, judging by continuing surge in popularity of hop-centric IPA style, but they haven’t lost their sweet tooth or taste for greater novelty.  That’s been fostering more alcoholic soda/beer hybrids – most of all, with Pabst’s Not Your Father’s Root Beer launch, which grabbed 0.3 beer share out gate and has left distributors and retailers scrambling to obtain enough inventory.  (That’s same $$ share as Miller Genuine Draft, Bud Light Mixxtails, and more than Redd’s Wicked Apple, Miller 64 Light and Bud Select, noted BBI sibling publication Insights Express, and one-third of way to 1 share held by entire Sam Adams franchise.)  Now others are lookin’ to grab some of action.  This week, Nashville, Tenn-based Wild Ginger Brewing launched Wild Ginger Alcoholic Ginger Beer, a 4% ABV item launching in 12-oz cans, initially in Southeast.  Meanwhile, soda marketers are finding opportunities to team up with craft brewers to offer such hybrid styles as radlers or shandies.  As noted earlier, NY’s Grown Up Soda pooled its Star Ruby Grapefruit Soda with Vermont brewer Whetstone Station’s pale ale for radler (BBI, May 21).  In Portland, Ore, meanwhile, pizza and fruit-soda marketer Hotlips Pizza has been teaming with local brewers to offer such radlers as PDX Radler (with Migration Brewing’s kolsch beer) and Super Radler (with Backwoods Brewing’s pale ale). 

Glens Falls, NY-based Just Beverages is starting to ship its Just Water brand, reported PostStar.com.  “We are beginning to fill warehouses across the country for some of our clientele,” said coo Jim Siplon, a former Fiji Water exec.  Jim cited confidentiality agreements in declining to ID key accounts beyond Whole Foods, but he noted, “I don’t think anyone will be surprised when they find out who we are working with,” as co seeks retailers with same commitment to recycling and community development, noted report.  Just Water has SRP of 99 cents pr 16.9-oz pkg, which is “made primarily from paper – 61% to be exact, with 35 percent plastic and 4 percent foil.”  Glens Falls, a little over 200 miles north of NYC, is home base of co and co-founder Drew Fitzgerald.  Co employs 15 with hopes to grow to as many as 50 over time, said Brian. In starting up, Just Beverages “considered but decided not to seek any government incentive or tax abatements,” and is paying city $5K per mo to access city’s watershed,” wrote PostStar.  Co will then pay city 1 cent per gallon after passing 1 mil gallons each yr, “6 times the rate residents pay.”  

Even tho energy drinks well outperform CSDs and other bevs, they’re “still largely relegated to 1 section of shelving at grocers and big boxers,” observed CLSA’s Caroline Levy, during recent visits to 6 retailers in Northern NJ.  On energy drink shelves, “immediate-consumption packages still dominate; however, both Monster and Red Bull had several units of shelf space for multipacks,” she noted.  Caroline found “overall shelf space was largely even” between Monster and Red Bull, tho “we noticed an increase in Red Bull SKUs since our last tour.”  That would be since influx of Red Bull flavors.  At big-box stores, Caroline spotted 8.4-oz Red Bull cans priced 10 cents higher than Monster 16-oz, and even a greater gap at “Target, Dollar General and a high-end grocer,” where MNST cans were on sale.  “Red Bull was not on sale at any of the stores visited,” noted Caroline.  So Red Bull holding its own despite Monster assault on NY market over past coupla years that’s seen Monster presence dramatically improve.

Long used in hospitals to get toxins out of systems of poisoning victims, activated charcoal is increasingly turning up in cold-pressed juices.  Latest aboard: Project Juice, with Black Magic item included in 3-sku Alkalinity Kit.  Lemon-juice-based Black Magic is pitched as “intensely detoxifying,” as “activated coconut charcoal absorbs energy-depleting heavy metals, chemicals and intestinal gasses.”  Entry joins fray that includes pair of NY players, one of whom has similarly named its entry Black Magic.

Possibly first into segment was NY’s Juice Generation chain, with series of black- or gray-hued cold-pressed juices that play on charcoal’s ability to trap gases and toxins from body.  It’s out in Activated Lemonade, Activated Greens and Activated Protein (using almonds and hemp seeds), like Project Juice using charcoal that’s created from roasted coconut shells.  All 3 sku’s list alkaline water in ingredient list.

Juice Generation founder Eric Helms told Time mag this spring that he got idea after spotting range of beauty products like face masks and pore strips touting activated charcoal as detoxifying ingredient.  Since lotsa Juice Gen customers buy its green juices for skin benefits, he figured it made sense to combine the 2.  Despite off-putting look, the charcoal drinks quickly went on to become his best sellers, he told mag.

A NY rival, LuliTonix, has similarly been offering activated charcoal bevs, via entry called Black Magic that’s positioned as “zesty lemon detox and purification elixir.”  It employs lemonade base for similar effect, at $8.50 per 16-oz bottle.  On Web site, LuliTonix describes activated charcoal as “one of the most badass absorptive and adsorptive agents known, able to extract and neutralize thousands of times its own weight in gases, heavy metals, toxins, poisons and other chemicals that we don't want loitering around inside us.” 

True?  In Time story on Juice Generation line, doctors indicated that, while inert ingredient won’t cause harm, “there’s no way to know what charcoal binds to and what it leaves alone—making it difficult to know whether drinking charcoal juice might flush out the nutrients you are drinking it for in the first place.  The experts Time spoke with said there’s little if any evidence for the health benefits of drinking activated charcoal unless you’ve been poisoned.”

The Project Juice entries leap aboard 2 trends: not just charcoal, but alkaline waters.  “The foods we eat leave either an alkaline or acidic residue in the bloodstream, based on their mineral content,” said certified nutritional consultant and cofounder Lori Kenyon Farley.  “If our diet isn’t balanced with the proper amount of acidic and alkalizing properties, our bodies will compensate by leaching mineral from our tissues to maintain the balance.  This leaching leads to bone loss, wrinkles, joint inflammation and creates a fertile environment for disease to grow.”  All 3 entries in Alkalinity Kit are lemon-juice-based, including The Master (fat-burning cayenne), Black Magic (activated coconut charcoal) and Turmeric Lemonade.  Kit is available for delivery nationwide at $85.50 per kit, including shipping, as well as at juice chain’s stores in Southern and Northern Calif.

Much-discussed and richly funded Soylent meal replacement brand – launched by techies for peers who’re too busy coding to eat – is making anticipated move from mixable powder form to RTD.  LA-based startup that pulled in $20 mil from Andreessen Horowitz earlier this year said yesterday it’s taking orders for Soylent 2.0, offering 12-packs of 400-ml PET Bottles for $29 including shipping to monthly subscribers, starting Oct 15.  Each bottle of sucralose-sweetened item is claimed to contain 20% of RDA of nutrients and calories, clocking in at 400 calories.  The blends follow similar recipes aside from protein switch from rice to soy, ceo Rob Rhinehart told Forbes.  Line boasts unrefrigerated shelf life of 1 year.  Besides drawing coverage from mainstay publications like Forbes and NY Times, new iteration notably continues to draw breathless coverage from tech-oriented outfits like TechCrunch and Gizmodo.  (Not many bevs you can say that about.)  Co is flogging new format with video that, against music of Howlin’ Wolf, shows shipwrecked airman ingesting single white bottle of Soylent, then using propeller of plane to fashion beachside fishing chalet from shore debris, complete with communication system to let family know he’s OK.  “Use less.  Do more,” title concludes.  Video’s posted at Soylent.com.  Co claims to have shipped powder kits more than 50K customers in its first 2 years, but bottled format, besides being more convenient, reps co’s recognition that folks are using it not just as full meal replacement but as interim snack.  As reported, Soylent is among flock of such engineered bevs under names like Juicero, Schmoylent and Schmilk that are raising $$ from tech world in order to advance humans beyond headache of eating actual food (BBI, May 26 and Jun 18). 

Honest Tea has deepened its “Refreshingly Honest” ad campaign this year, putting greater emphasis on ingredient story, even as it launches first paid media behind its fast-growing Honest Kids subline.  For core tea brand, co is mustering images like PET bottle of Honey Green Tea flavor with teabag label, dripping honeycomb and mint sprigs dangling from under sealed lid, flagging presence of real ingredients inside.  Honest Kids creative features imagery calculated to appeal both to kids and their moms, such as duck created from intricately carved apple slices (for Apply Ever After flavor).  That’s intended to flag presence of real apples in item.  Bethesda, Md-based unit of Coca-Cola is making out-of-home buys in expected key markets like NY, LA, San Diego, Chicago, Boston, Baltimore/DC, Miami, SF, Portland (Ore), Seattle and Philadelphia, but also in smaller markets Denver, Sacramento, Minneapolis, Hartford, Conn, and Tampa, Fla.  Visuals were developed with Lambesis agency, and media buy placed by Noble People (formerly Ikon3).  Related online video leg to campaign will materialize in late summer or early fall.

Move comes as brand is back calculating different cities’ Honesty Index on basis of tea displays left unattended in public spaces, this time in 28 cities around country, a bit scaled back from last year.  As last year, displays include both core teas and Honest Kids juices for $1, on the honor system.  Results are due Aug 25.  And co is mustering huge displays of its multiserve Fair Trade-certified Honest Lemonade at Whole Foods, returning to exclusive program that’s anticipated this year to sell out before Aug is out, founder/ceo Seth Goldman told BBI.

Honest Tea has deepened its “Refreshingly Honest” ad campaign this year, putting greater emphasis on ingredient story, even as it launches first paid media behind its fast-growing Honest Kids subline.  For core tea brand, co is mustering images like PET bottle of Honey Green Tea flavor with teabag label, dripping honeycomb and mint sprigs dangling from under sealed lid, flagging presence of real ingredients inside.  Honest Kids creative features imagery calculated to appeal both to kids and their moms, such as duck created from intricately carved apple slices (for Apply Ever After flavor).  That’s intended to flag presence of real apples in item.  Bethesda, Md-based unit of Coca-Cola is making out-of-home buys in expected key markets like NY, LA, San Diego, Chicago, Boston, Baltimore/DC, Miami, SF, Portland (Ore), Seattle and Philadelphia, but also in smaller markets Denver, Sacramento, Minneapolis, Hartford, Conn, and Tampa, Fla.  Visuals were developed with Lambesis agency, and media buy placed by Noble People (formerly Ikon3).  Related online video leg to campaign will materialize in late summer or early fall.

Move comes as brand is back calculating different cities’ Honesty Index on basis of tea displays left unattended in public spaces, this time in 28 cities around country, a bit scaled back from last year.  As last year, displays include both core teas and Honest Kids juices for $1, on the honor system.  Results are due Aug 25.  And co is mustering huge displays of its multiserve Fair Trade-certified Honest Lemonade at Whole Foods, returning to exclusive program that’s anticipated this year to sell out before Aug is out, founder/ceo Seth Goldman told BBI.