
Beer Marketer's Insights
EXPO WEST: Celsius Holdings Pulls in Another $15 Mil, Led Again by Asian Mogul Li Ka-Shing
Celsius Holdings continues its strategy of bringing in new growth capital from Asian investors and from cultural icons, announcing $15 mil in latest round. New tranche is being led by current investor Li Ka-Shing's Horizon Ventures, as well as Asian singer/songwriter GEM and zVentures, investment arm of gaming brand Razer. Among investors who've participated in past rounds of publicly traded CELH are Russell Simmons and his former wife and fashion designer Kimora Lee. In brief phone discussion today, new ceo John Fieldly, who's picked up reins from now-retired turnaround expert Gerry David (BBI, Feb 24), said fact that Ka-Shing has come back for another round at 25% premium reflects improving prospects for once-beleaguered calorie-burning brand. As reported (BBI, Feb 27), at Expo West Celsius made its move into natural realm with 4-flavor line sweetened with stevia/erythritol blend. But Fieldly promised there will substantially more innovation on way now that new resources have come in.
Obviously, judging by avalanche of media coverage, rumor we picked up on Expo West show floor on Fri morning turned out to be true: Kevin Klock has abruptly departed position as prexy/ceo of Talking Rain, on eve of launching $37 mil ad campaign under theme "Be Not Bland" and announcing acquisition of yet-unidentified brand. During our weekend scramble covering Expo West we haven't yet been able to detect reason for surprise development, and Talking Rain staffers manning booth for Sparkling Ice essence subline said they'd heard nothing officially so far about why, tho it was completely unexpected. Preston, Wash-based co issued statement saying Kevin is being succeeded in interim by cfo Marcus Smith, 3-year Talking Rain vet who'd held similar posts outside bevs at Mobisante and publicly traded SonoSite. Marcus was among Talking Rain team that recently met in NY with media, outlining ambitious marketing and acquisition plans (BBI, Feb 22). BBI editor spent quite a bit of time with team that day and didn't detect any signs of stress at all. As for acquisition, that was to be part of effort by Klock to make good on longstanding assurances to DSD network that he would be bringing them other broadly appealing brands to help them grow, tho whether deal is happening now, or even might have been focus of dispute between Klock and private ownership group, isn't known at this time. Klock has been frequently lionized for taking sleepy regional Ice brand in 2011 and growing it to well beyond half-bil by 2015, tho co has struggled to fully monetize achievement. While in NY, co brass had said they hadn't ruled out IPO effort.
Coca-Cola is offering pina colada flavor with "zero regrets" in its Vitaminwater Zero subline, offering pineapple coconut flavored entry dubbed Reset. With complement of vitamin C and B and potassium, Reset rolls in 20-oz bottles line-priced at $1.59.
Produce giant Dole debuted non-GMO tropical blends called Jaya packed in 8.4-oz slim cans that will hit shelves in Jun in trio of flavors: Pineapple, Passion Fruit & Carrot; Pineapple & Mango, and Pineapple & Banana. They're made with 100% juice from concentrate with no added sugar. Booth staffers said pricing hasn't been set yet. Nor did they know origin of evocative-sounding brand name.
Determined to show retailers and distributors that their rollup co is on way to becoming innovation powerhouse, Denver-based New Age Beverage unveiled 3 new product platforms at Expo West.
Farmhouse Culture, fresh off a Series D investment that included General Mills' 301 venture fund, used Natural Product Expo West as platform to debut its first full-fledged foray into RTD bevs, offering a version of its two-and-a-half-year-old Gut Punch probiotic shots in 12-oz glass bottles priced at $3.79. New line uses fermented veggie base - "beet-based, kvass-like," as one booth staffer put it - and is claimed to include 4 mil cfu's per 8-oz serving, on part with some kombuchas, but only 20 calories. It's debuting in broad range of approachable flavors: Orange Cream, Mango Guava, Ginger Lemon, Strawberry Hibiscus, Cherry Cacao and Cola. Three of entries are produced with golden beets and others with ruby beets, with bev color partly a factor. It will be produced next week for arrival on store shelves in Jun/Jul timeframe. As for the gut shots, they're being extended with Garlic Dill Pickle, Ginger Beer and Korean-style Kimchi flavors.
Harris Freeman's fledgling PureSteeps incubation unit is wasting no time scaling its Secret Squirrel acquisition, broadening line and shuttering small mfg operation in LA in favor of Fresh Bev copacker in Conn, with plans to reinstate West Coast production at bigger plant in LA area for which co is undertaking site search. Meanwhile, cold-brewed brand has entered 380 Target stores on West Coast with its 3 RTD latte entries.
RESEARCH: Bottled Water Volume Slips Past CSDs in Per-Cap Consumption, Says Bev Marketing
Another data arbiter has lent its voice to chorus heralding overtaking of CSDs by bottled water as #1 bev category in US, and drawing similar rash of media coverage. This time it's NY-based Beverage Marketing Corp, citing 9% volume surge to 12.8 bil gals, slipping past CSDs on per-capita basis by 39 gals to 38.5 gals. For CSDs, that per-cap # is severe dip from over 50 gals at turn of century, figure that Beverage Marketing expects bottled water to reach by middle of coming decade. Other data trackers like Beverage Digest/Zenith Int'l had earlier heralded leadership change.
Has Talking Rain Chief Klock Moved On?
Over years Natural Products Expo West has proved hotbed of industry speculation, as hundreds of bev execs mingle on massive show floors in Anaheim, Calif. This latest bit of speculation is no different, and rumor makin' rounds among trade partners is a doozie: that Talking Rain prexy/ceo Kevin Klock may be movin' on. Tho Seattle-based co is family-controlled, rumor seems a stretch: after all, onetime dairy plant mgr Klock is exec responsible for growing Sparkling Ice from sleepy Pac NW entry into national DSD juggernaut, and at recent media breakfast he outlined ambitious plans for 2017 and signaled that co's first acquisition may be imminent as he seeks to make good on promise to fortify DSD network with other growth engines. So we're a bit mystified, but just passing on what we've heard. No immediate response to query left with Kevin today.
Bruce Cost Ginger Ale has unveiled new line branded as Brooklyn Organics Craft Ginger Ale, for first time offering zero-sugar, stevia-sweetened entry that eschews the name of its eponymous founder. New organic, non-GMO line packed in 8-oz cans priced at $1.49 attempts to provide guilt-free take on ginger ale, in range of unusual flavor combos including a Cola sku that echoes similar ginger/cola combo offered by PepsiCo in its canned 1893 boutique line. (Tho marketing mgr Kevin Li said BCGA's take riffs off old Asian tradition of reinforcing colas with ginger as healing potion.) Unlike Bruce Cost-branded core line, which is produced from ginger painstakingly processed in co's Brooklyn plant, this one relies on ginger extract procured outside the co. Both lines are copacked outside Brooklyn, tho. This also represents co's first organic entry.