Our debut episode, “Is Gatorade Beatable?” explores Coca-Cola’s mission to use a combined BodyArmor and Powerade to overtake sports drink leader Gatorade in the coming years. Coke leaders are through being an also-ran in this category, and PepsiCo has no plans to give up its supremacy. That will make for great competition, even as the category shifts beneath both companies’ feet with the emergence of “rapid hydration.”
Episode 2, “Is Sprite Beatable?” delves into PepsiCo’s Starry lemon-lime soda launch and the company’s plans to disrupt the dominance of Coca-Cola’s Sprite. We discuss how Sprite spent decades embracing hip-hop and the NBA to build a loyal consumer base, and how PepsiCo has decided to start from scratch with Starry to reach Gen Z consumers after years of struggles with lemon-lime brands including Sierra Mist.
Back in my Bloomberg News days a decade ago, a colleague and ex-options trader, who was often intrigued by health and profit hacks, brewed a cup of Keurig coffee one morning and whisked it with grass-fed butter. He extolled the virtues of the concoction for both health and mental acuity. He believed it gave him the kind of physical edge that folks on Wall Street and Silicon Valley are forever striving to unlock.
Before long, seemingly everyone looking for an edge was talking about that trend and the brand fueling it, Bulletproof. Founder David Asprey had been energized by the yak-butter tea he drank during a meditation excursion in Tibet. Asprey introduced US consumers to grass-fed butter coffee by way of Bulletproof in 2013. The company included a healthy fat called MCT oil to provide energy to the brain and body. Bulletproof became a cornerstone of the keto diet fad, a modern on a low-carb diet. Keto encouraged consumption of quality fats and protein.
Bulletproof sold plenty of coffee beans, pods, and MCT oil. However, the company’s ready-to-drink offering, launched in 2017, hasn’t caught on and may have been too late, despite the brand’s keto-on-the-go promise. Instead, Super Coffee has dominated the MCT-infused keto coffee space. A 2018 appearance on Shark Tank, investments from the likes of NFL quarterback Aaron Rogers and pop star Jennifer Lopez, and a 2020 national distribution partnership with Anheuser-Busch has propelled that brand to the forefront.
That’s why Starbucks’ launch of olive oil infused coffees at a cafe in Italy is especially eye-catching. Called Oleato, the barista-prepared drinks — in hot and iced forms — appear to take cues from the MCT coffee craze, although Starbucks’ pitch is all about mouthfeel. “The alchemy of Starbucks arabica coffee and premium Partanna extra virgin olive oil (EVOO) creates an entirely new experience, taking on a depth and dimension that simply must be tasted to be believed,” the company’s website states. The drinks are headed to California in the spring.
As I tweeted last week, Oleato is just the kind of innovation that could one day jump to the RTD market by way of Starbucks’ JV with PepsiCo. That successful partnership has...
The past year brought considerable backlash to environmental, social, and governance (ESG) activities within corporate America and finance. Republicans like former Vice President Mike Pence say “the woke left” wants to impose “a radical environmental and social agenda on publicly traded corporations.” Alternatively, environmentalist organizations like the Sierra Club have sued Coca-Cola and other beverage companies for allegedly “greenwashing” the negative impact of their operations. The SEC has proposed new ...
If you have young adults in your life, hopefully they have introduced you to bubble tea, also known as boba tea. This combination of tea, milk, and gelatin-like tapioca pearls, invented decades ago in Taiwan, can by now be found in strip mall cafes all over the US. Almost always there are high school and college students inside slurping boba beads through oversized straws. Franchised versions of the concept have of course followed.
Having visited a few of these bubble tea cafes with my kids, I was primed to notice several ready-to-drink and make-at-home versions seeking to capitalize on the boba trend — and to take drink occasions away from iced and bottled coffee. Here are a couple:
During an interview at Future Smarts last month, a Wall Street analyst said he would have been laughed off the stage several years ago had he predicted US carbonated soft drink pricing growth of +15% without a troubling pullback in volume. No one is laughing now. Consumer acceptance of significant pricing growth across major beverage categories has shocked even the most seasoned industry watchers. Despite the price escalation, CSD volumes declined at a manageable -1.4% last year. Energy drink makers, who are generally slower to boost prices in a booming category with lots of new entrants, raised pricing by +6.3% and still added +3.5% more volume. While Sports drink category ...
Alcohol was a hot topic at our Future Smarts conference on Dec. 5 in New York.
A Pepsi bottler made news related to alcohol distribution, and executives at Coca-Cola and
PepsiCo made even clearer their interest in the sector. You’ll find a related story in today’s
The Coke executive was Henrique Braun, the company’s incoming president of international development. In an on-stage interview, we talked a lot about Coke’s core non-alcoholic business as well. I asked him about his priorities for the...
Being a nosy beverage industry journalist and commentator, I often ask people what’s in their refrigerator. Sometimes I look myself -- with permission! So, it’s only fair that I share my personal beverage landscape, plus some observations:
Bottled water is an anchor beverage for our house. It is convenient. We always have a case of private label filtered water on hand. From there, we branch out into 1-liter or larger bottles of branded spring, electrolyte, or specialty water depending on what’s on promotion. While we are brand agnostic, we prefer filtered water over the softness of spring water. We are recyclers.
We like zero sugar colas and root beers as a pick-me-up or refresher. While cans are the norm, we buy PET bottles when our preference is out of stock. We like promotions but we’ll generally...
During the recent stretch of third-quarter earnings calls for investors, executives at Coca-Cola, PepsiCo, and Keurig Dr Pepper remained buoyant as consumers barely batted an eye at higher beverage prices, as evidenced by US soft drink results at retail this year (page 9). “We've seen elasticity continue to be strong and stronger than expected through three quarters of the year,” PepsiCo CFO Hugh Johnston said on Oct. 12. “And obviously, we are carefully watching what happens with the consumer.” Almost two weeks later, Chairman and CEO James Quincey told investors...
As you know well as a BD subscriber, we are paying far more attention to the alcohol beverage market. In today’s issue, we write about the friction caused by non-alcohol beverage companies as they find ways to patriciate in ready-to-drink alcohol.
Given that backdrop, we are excited to announce the addition of Anheuser-Busch InBev to our Future Smarts conference program. Our guest will be Fabricio Zonzini, president of ABI’s Beyond Beer business unit in North America. He runs the fastest growing business unit within ABI’s largest geographic zone.
During a fireside chat with me, Zonzini will provide commentary on industry trends in RTD cocktails, seltzers, and low-alcohol packaged beverages, which have been a focus of growth for the world’s largest beer brewer. ABI also plays in traditional non-alcoholic RTD categories including energy
With all the excitement over Celsiuslately, one could lose sight of the fact that global players Red Bull and Monster still control more than half the US energy drink category. Each is busily defending its turf while growing volume and dollars. But with long-standing or second-generation owners, they are ripe for M&A speculation.
Rumors last week that Red Bull co-founder Dietrich Mateschitz is seriously ill sparked just such talk. Dietrich and his family hold 49% of Red Bull. The family of the late co-founder Chaleo Yoovidhya owns the rest. Could the company...