Limitless Coffee, which boasts good local visibility in Chicago thanks to successful effort by founder Matt Matros to build Protein Kitchen eatery chain, has been making a statement lately with pair of elegantly designed retail stores that we visited during recent trip.  It’s part of effort to build brand that’s grown to encompass successful coffee-roasting biz, well-regarded line of glass-bottle cold-brewed coffees and matcha teas, and most recently a lightly caffeinated, unsweetened canned line that offers more premium, functional alternative to La Croix.  That line was quickly picked up not just locally by Jewell and Mariano’s but by likes of Walmart, Safeway (Ariz), Albertsons (Tex), Whole Foods (SoCal), Fresh Thyme, Earth Fare and Central Market.

Striking flagship store is out in booming Fulton section of West Loop, which has seen invasion by the young, the techie and the trendy.  Ballast Point situated small brewery there, UK’s Soho House opened there, Google just took over 150K-sq-ft former cold storage warehouse, WeWork has big unit there and another UK icon, Hoxton Hotel, opened 3 weeks ago.  Rich Melman’s Lettuce Entertain You restaurant group has departed from its commitment to River North nabe to open Beatrix Restaurant & Market at key crossroads.

Matros and his partner Jeff Shapack were prescient enough to acquire some of real estate in 2014, building 2,500-sq-ft flagship store on part of it and partnering with Lettuce Entertain You to open Asian restaurant on other.  Flagship store has been designed to accommodate work-from-home crowd, with outlets everywhere, whiteboard and TV screen for presentations; Pepsi and Sara Lee are among companies that have hosted events there and mayor-elect Lori Lightfoot kicked off her campaign there.  A coffee roaster behind transparent screen in back was recently removed to accommodate next phase, which Matros wasn’t ready to discuss yet.

There’s similarly outfitted sibling on Wells St in River North nabe (photo below), as well as small shop on Michigan Ave.  Items offered at the stores boast cutting-edge bev ingredients like beets, schizandra and charcoal, in riot of colors that offer Instagram appeal.  Beet Rose Latte, for instance, includes schizandra berries for antioxidants and to help mask beet taste.  Also in mix are likes of Turmeric Latte and Lavender Latte (a brisk seller in stores, even tho lavender flavor of bottled cold-brews have proved a stretch to most consumers).  Line of fizzy entries meld fresh fruit without added sugar and sparkling water.  Matros and culinary staff tinker with Instagram-bait ingredients like butterfly pea flower, flavorless addition which makes bevs intense blue but changes color when citrus is added.  Shops are viewed as key test lab for flavors and recipes that might make their way out to RTD biz.

Wholesale coffee biz that we profiled a year ago (BBI, Apr 26 2018) is doing well, in 500 offices by now including likes of Salesforce.com, largest private employer in SF, and Netflix in Silicon Valley, which Matros said blows thru Limitless matcha.  All told, coffee beans, kegs and tea do $2 mil in wholesale sales now, helping to fund the RTD push.   As for striking glass-bottle line that represented co’s initial foray into RTD, those do well in some accounts like Whole Foods stores in Southern Calif, but team acknowledged it will take a back seat for now to canned sparklers that have been immediately embraced by retailers.  Those entries use no sweetener and contain 35 mg of naturally sourced caffeine per 12-oz can, comparable to amount found in a diet soda.  It’s out in 6 flavors: Blood Orange, Watermelon, Grapefruit Hibiscus, Cucumber Pear, Ginger Mint and Lemon Lime.

Recently added to team was Zach Hotle, former sports-marketing agency exec who worked on Nike and Red Bull brands, then had good run at Neuro, first in marketing then in sales, where he worked closely with Dr Pepper Snapple, which is copacking the canned items at plant outside Chicago in Northlake.  He also did stint at Uptime energy brand.

Grocery giant Kroger has teamed with private investment co Lindsay Goldberg to create incubator for new consumers brands that might thrive in its stores. Partners said new entity will go by name PearlRock Partners, relying heavily on data-driven approach that Kroger has pushed hard via its 84.51° subsidiary. Supermarket News noted that PearlRock Partners dovetails with Restock Kroger strategy to “redefine the customer experience,” in process building alternative profit streams targeted to hit $400 million in operating profit by 2020. “To that end, Kroger aims to monetize the huge, rich stores of data amassed from its position as the nation’s largest supermarket company, with 2,800 stores, vast digital properties, millions of daily transactions, and broad technology and analytics capabilities,” SN noted. To bev marketers, there will be at least one familiar face in effort: former Coke exec and Keurig Green Mountain ceo Brian Kelley, now a partner at Lindsay Goldberg. “Backed by a state-of-the-art predictive data platform, real-world consumer product expertise and unparalleled merchandising resources, these next-gen brands will be poised for growth and offer Kroger’s broad customer base greater choice, convenience and innovation,” he said. Tho Lindsay Goldberg has managed numerous investments on energy and industrial side, on food/bev side it numbers as exited investments McDonald’s supplier Keystone Foods Holdings and spirits distributor Maine Beverage, and is current investor in Golden West Packaging.

Buoy, a St Louis marketer of “easy squeezy” electrolyte drops, has teamed with local non-alc beer specialist WellBeing to launch a “healthy, hydrating” non-alc beer dubbed WellBeing Victory Wheat Powered by Buoy. Each 16-oz can is claimed to contain 3 servings of Buoy’s blend of electrolytes (sea salt, potassium, magnesium, chloride), vitamins and antioxidants. “Finally, a beer that’s proud of its nutrition label,” states Buoy website, in apparent reference to Anheuser-Busch’s much-touted move to include panels on some of its packaging. Co was founded by youthful software specialist Daniel Schindler and pharma sciences PhD named Lianli Li, who modeled their water enhancer after oral rehydration salts (ORS) formula of World Health Org, as have other hydration plays. Schindler also has filed for patent for “integrated, free-flowing spout for all 750-ml and half-gallon liquor bottles to mix a naturally flavored hydration solution with every ounce of alcohol poured,” per his LinkedIn page.

Unlike Walmart, 7-Eleven has never been an impregnable fortress to early-stage food/bev brands: after all, Soylent first tested its RTD items in 7-E stores around LA and co’s venture arm is believed to have invested in early-stage brands like Core Water.  But taking a leaf from Walmart and other major retailers that are showing greater urgency in taking down entry barriers, Irving, Tex-based retailer has offered 125 LA-area partner stores the option of picking up nearly 100 new brands on list of 31 up-&-coming companies, per Natl Assn of Convenience Stores and other media reports.  Tho 7-E reports don’t include specific brand names, they play in range of segments like keto, paleo, vegan, organic, high-protein, low-glycemic, gluten-free, nutrient-dense, plant-based and cold-pressed.  Pic supplied by retailer shows shelf set with brands like Roar Organics, Cabana, Spindrift, Soylent, Koia, Tio Gazpacho, Harmless Harvest, Brew Dr Kombucha’s new cans and Kor shots.  Sign above cooler reads, “Sips + Snacks That Love You Back.” 

“When our emerging brands team created this unique product assortment in collaboration with our category managers, the goal was to give customers drinks and snacks that they might not expect to find at a 7-Eleven store,” said vp new biz development Chris Harkness in statement.  “Customers are demanding healthier options.”  The list is outgrowth of “Next Up” showcase event held last Nov at 7-E’s Store Support Center in Irving, at which 7-E employees and local franchisees voted on their favorites among 70 participating cos selected from 300 that had applied.  More than half of the 70 were owned by women (26), minorities (9) or veterans (2).  It was later decided to go out with idea in LA.  “We don’t want small and emerging vendors to be intimidated by 7-Eleven’s size,” Harkness said.  “7-Eleven is always on the lookout for innovative companies who have a fresh take on a product, a healthier alternative or a unique flavor that might become the next big food trend.”

Keurig Dr Pepper should enjoy slightly broader public float to its shares after Acorn Holdings acquiesced in its request to ease off on its holdings, move that increase liquidity to tune of 20% float by year-end. Currently that float is 15%, tho Acorn had previously agreed to sell 47 mil shares, resulting in 18% float. “Except for this increase to approximately 20% of the public float, Acorn does not intend to sell any additional shares of KDP in the foreseeable future,” KDP advised shareholders. Consumer Edge’s Brett Cooper noted that KDP didn’t have many other options, considering that Mondelez, the #2 holder after JAB, has indicated it’s not likely to sell in short term, and KDP mgrs holding shares don’t turn over much. Meanwhile, KDP has set next Thurs for public groundbreaking of new hq facilities in Frisco, outside Dallas.

If it’s looking for its “Impossible to hate” campaign to gin up quick awareness for its Pressed coconut water extension, Vita Coco seems off to flying start. New campaign, which aims to get nastiest-sounding raters to deem Pressed acceptable as way of overcoming ingredient’s continuing stigma among some consumers (BBI, May 15), seems to have unleashed social media frenzy as it engaged with heavy Twitter poster and outspoken coconut-water-scoffer Tony Posnanski. He rejected overture to try Pressed by saying, “Save that nasty shit for someone else. I would rather drink your social media persons piss than coconut water.” Vita Coco’s response, which immediately started making online rounds, was to post photo shot in rest room of staffer holding VC-branded jar containing ample amount of yellow liquid, along with the request, “Address?” That seemed to momentarily stun Posnanski, who tweeted, “What the fuck is wrong with you?” before eventually coming around to acknowledging “this is extremely funny.” “I just became a @zicococonut customer,” chimed in Octopus/Caveman. “I think you might be terrible at your job.” “Terrible or a genius,” assessed PhD student in Japan who goes by Kaiju University. “My money is on the latter.” Trade paper Ad Age took conventional brand-association view on what it headlined as “pissing match” by writing that “Vita Coco is apparently so desperate for attention that it is linking its product to urine. Really.” Mashable offered kinder take, opining simply that “”Brands uh, really are going for it these days” and offering play-by-play commentary. Recall, too, that this is brand that once survived episode dubbed Squidgate in which customer found odd gunk in pack by assuring consumers that brand is “squid-free.” (If you go in for that kind of thing, you can see photo here.

With less than a week to primary Day in Philadelphia, new study reports that sales of sweetened bevs plunged 51% in city since it adopted 1.5-cent-per-ounce tax in 2017, Philadelphia Inquirer reports. Study by researchers at Univ of Penn, Harvard Univ and Johns Hopkins Univ, found bev sales in areas outside city “increased,” so when you factor in folks traveling for cheaper soft drinks, the tax “resulted in an overall reduction of 38%.” So it’s not like consumers didn’t substantially cut back on sugared bevs, as policymakers intended, even tho some dodged tax by shopping outside city boundaries. “Part of this is not at all surprising,” observed lead author Christina Roberto, asst prof of medical ethics & health policy at Penn’s Perelman School of Medicine. “There’s a mountain of literature from economics that if you raise the price of something, people will buy less. We’ve all been curious how beverage taxes actually play out in the real world.” Tho there’s been lotsa spin from advocates on either side of issue, this was one of only peer-reviewed studies on Philly tax, Inquirer noted. While results of study will be viewed as “a good outcome” by public health advocates, retailers won’t be pleased. And critics are sure to point out that study, which appeared in Journal of American Medical Assn, was funded by outspoken bev-tax supporter Bloomberg Philanthropies.

NA bevs had another good year in 2018, per preliminary tally from Beverage Marketing Corp, growing 2.2% by volume to 33.9 bil gals and 3.8% in retail dollars to $180 bil. Both represented acceleration over 2017 performance in what Beverage Marketing terms “liquid refreshment beverages” (LRBs), up 1.8% by volume, 2.4% by $$. Buoyed by brands like Essentia, the value-added water segment surged 15.5% by volume, +16.6% by $$, far outpacing core bottled waters, up 4.9% by volume, +7.3% by $$. Both energy drinks and RTD coffee enjoyed close to double-digit growth, with energy category up 8.6% by volume, +8.4% by $$, and coffee up 8.8% by volume, +7.9% by $$ off smaller base. In sports drink segment, volume growth of 2.8% was outpaced by $$ growth of 4.9%, reflecting at least in part the inroads being made by premium-priced Body Armor. Iced tea was off a tad by volume, -0.3%, but up 2.7% by $$, as superpremium tier comprised of brands like Teavana and Pure Leaf Teahouse Collection exerted impact. Thanks to Big 3’s efforts to offer smaller-size packs and maintain price realization, CSDs enjoyed 2.4% $$ gain even tho volume sagged 0.4%. Fruit bevs, not in a happy place in recent years as consumers try to avoid sugar, declined 3% by volume, 1.2% by $$. By $$, that was only segment to be down.

After initial launch in coupla eastern US regions, Anheuser-Busch has rolled out sparkling extension of its bottled Teavana tea, in process adding a 3d flavor to lineup. Sparkling Blood Orange Mango White Tea joins Sparkling Blackberry Lime Green Tea and Unsweetened Sparkling Peach Nectarine Green Tea, line-priced with core noncarb line at $2.39 per 14.5-oz glass bottle. Recall that sparkling extension broke in Northeast and Midwest last year (BBI, Jun 14), augmenting line created in partnership with Starbucks, which owns trademark. Partners say they’ve sold over 15 mil bottles of Teavana so far.