Beer Marketer's Insights
Ex-model Kimora Lee has gone to court to claim $93 mil in Celsius shares that her ex-husband, banker Tim Leissner, was ordered by a court to disgorge after pleading guilty in sprawling Malaysian fraud case, Bloomberg reported. She argued before a federal judge in Brooklyn on Fri that she owns the 892,732 shares in Celsius Holdings after purchasing the shares with money she earned from her modeling career and her Baby Phat clothing line, wire service reported. Baby Phat was a spinoff of Phat Farm, the fashion line operated by her husband at the time, the hiphop mogul Russell Simmons. Recall that Lee and Simmons had come in as key investors back in the days 8 years ago when Celsius still was struggling to find its footing (BBI, Apr 21 2015). "The shares were wrongly included in a March federal order requiring Leissner to surrender more than 3.3 million Celsius shares as proceeds of his crimes," she's been arguing, per Bloomberg.
Operator of expanding Red Cow chain in Minn has dipped a toe in RTD space with canned Ginger Beer and Mule offerings. Luke Shimp, operating as Double Black Diamond Hospitality, told Twin Cities Business mag he's invested $200K+ in first run of the 2 items at unidentified Mich copacker, and in recent weeks they've trickled out to Target Field, local liquor stores and Lund's & Byerly's grocers, tho he plans to move beyond state lines with entries. The non-alcoholic Ginger Beer, packed in conventional 12-oz cans, is made with Peruvian ginger juice and fresh lemon and lime juices with no extracts, oils or added acids, per website. The alcoholic Mule, packed in 12-oz sleek can, is made with vodka and floral pink peppercorns, tho website unusually doesn't offer any indication of what is the ABV. Shimp plans to add old fashioned, espresso martini and strawberry margarita entries this fall, about when he opens his seventh location in state. He's previously played in bevs as partner in a wine brand called Moonshot that launched in 2019. Opened a decade ago, Red Cow is a self-styled "modern tavern" named for its emphasis on red wine (tho cocktails and craft beer also are key) and burgers crafted from 60% certified Angus beef and 40% ground bacon patty. Shimp follows in footsteps of Bruce Cost, restaurateur who parlayed a popular in-store offering into packaged ginger ale line.
Over the past 16 years Matt Hughes was highly visible face of Coca-Cola's innovation efforts, taking frequent seat as judge at BevNet Live Showdown competition and joining the throngs that trolled show floors at Expo West seeking the next big discovery. Now, after launch of Jack & Coke alc effort, well-liked exec quietly moved on Apr 30, with plan of seeking advisory roles across CPG spectrum, he told us today. His last title at KO was vp of emerging brands for new revenue streams.
Polar Beverages chief Ralph Crowley offered intriguing glimpse of major KDP-aligned bottler that's forging unusual path to growth and relevance. On distribution side, at time many major houses on both beer and soft drink sides are on crusade to reduce their service levels, particularly to small indie accounts, so that every route stop brings in robust profits, Polar is happy to "overservice" its accounts because, as Ralph succinctly put it, "the more you service the more you get." And while many houses are eager for multitudes of early-stage brands in hope that a few will eventually ignite, Polar has learned to pick its spots more carefully, turning down brands like Honest Tea, Bai and Body Armor in their earliest days while waiting for the greater scale that's a better fit with operation. On brand side, its Polar-branded seltzers have been on new growth jag thanks to national alliance with its core supplier Keurig Dr Pepper, winning share vs major incumbents like La Croix and Bubly. And while Crowley is clearly proud that a new generation of family members is carrying on the legacy at 141-year-old bottler, they're encouraged to do so only after spending the first decade or so of their career outside the family biz - with the more modest achievers steered to family's ski resort rather than the bottling operation. His 3 children at work at Polar today started at Nestle Waters, New Balance and in private equity.
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Constellation Brands stock up 2% on "speculation of potential activist involvement after a 13F filing," wrote Seeking Alpha. Barclay's added 1.9 mil shares. "It's possible that an activist investor may be accumulating the shares through Barclay's" thought Gordon Haskett's Don Bilson. "The additions from Barclays is noteworthy because prime brokerage sometimes acts as counterparties for activist swap positions." But same analyst threw some cold water on his own speculation. "He doesn't see a high likelihood of any activist given the Sands family's sizable stake" (14%) and "it's not clear what an activist might push for besides board seats."
Following up on comments during Q1 conf call, ABI ceo Michel Doukeris continued to explain AB's position on Dylan Mulvaney controversy. There is a lot of "misinformation and confusion," online that led to boycott, he told Financial Times. "You have one fact and every person puts an opinion behind the fact. And then the opinions start to be replicated fast on each and every comment. By the time that 10 or 20 people put a comment out there, the reality is no longer what the fact is, but is more [about] what the comments are," lamented Michel.
Jim Koch on "Complete Taste Plasticity" of AABs; Beer Distribs as "Winners" in Total Bevs
"I only stepped in because the AB guy bailed out," quipped Boston Beer chairman Jim Koch when Bev Mktg's Michael Bellas introduced him and thanked him for speaking at the Beverage Forum last week (Jim a last minute addition after AB cco Kyle Norrington couldn't make it). Speaking about spirits-based RTDs, FMBs and hard seltzer, which Bev Mktg calls AABs (adult alternative beverages), Jim identified their "complete taste plasticity" as key characteristic driving growth. "You can make things taste however you want them to," said Jim, beverages that are "designed to be pleasing," instead of an acquired taste. And "liquor figured it out first," he added, specifically vodka. "I believe about 80% of liquor is consumed in a mixed drink," almost always with "sugar, juices, spices." It's "easy to innovate in the space," said Jim.
First 4 weeks of natl scan data since Bud Light/Dylan Mulvaney controversy erupted and numbers continue to look very challenging for AB. Total AB volume down 12.5% for 4 weeks thru Apr 29 in NielsenIQ data. AB lost 4 share of volume down to 37.7. $$ sales down 8.1% and AB lost 3.4 share of $ to 32.
It didn't really get better in natl scan data in latest week thru end of Apr. Bud Light $$ sales down 22% in 1 week data thru Apr 30 in Circana (formerly IRI) multi-outlet + convenience data, with drops of 30% or more in many, mostly smaller or mid-sized states in South. Drops more modest in most of biggest cities, but still down 14% in Dallas, 3% in Miami, 9% in Vegas, 12% in Houston for example. NY state had surprisingly big 27% drop in latest week of data, plus OH over 30% too. One month in and it's still a mess.