Loko Rita Marks Latest Adult Beverage Product From Phusion Projects
Phusion Projects is introducing a new adult beverage, Loko Rita.
Available in Margarita and Peach Margarita, Loko Rita is 8 percent ABV and uses natural flavors and real fruit juice. Loko Rita is available in 16-oz. single cans.
“With the introduction of Loko Rita, we are showcasing our ability to develop new flavors and innovative packaging,” said Jim Sloan, EVP with Phusion Projects. “The tactile can is something we feel will draw consumers to the product and the taste will keep them coming back for more.”
Loko Rita is launching in four test markets this month: Tampa-St. Petersburg, Fla.; Raleigh-Durham, N.C.; Richmond, Va.; and Las Vegas, Nev.
Phusion Projects is a Chicago-based, multi-brand alcoholic beverage company that sells its products—including Four Loko, Poco Loko, Earthquake, Moskato Life and Island Squeeze—in the U.S. and Canada.
Energy Drinks See Continued Growth
Soft Drink Volume and Share Decline
The U.S. liquid refreshment beverage market grew by 1 percent in 2012, according to newly released preliminary data from Beverage Marketing Corp. This marks a third year of growth after two consecutive declining years. It also represents faster growth than occurred the year before. Total liquid refreshment beverage volume approached 29.8 billion gallons in 2012.
Carbonated soft drinks remained by far the biggest category, but lost both volume and market share during 2012. Volume slipped by 1.8 percent from 13.6 billion gallons in 2011 to 13.3 billion gallons in 2012, which lowered their market share to less than 45 percent. While the segment faltered, certain soda trademarks, such as Coke Zero and Dr Pepper, did achieve growth. According to published reports, the soda industry has seen declines since 2005, but 2012’s soda consumption figures represent a 26-year low.
Reports speculate that soda’s decline stems from health advocates, who point to soda as a cause of the obesity epidemic. Soda companies won’t be discouraged, though, as The Coca-Cola Co. has jumped into the obesity debate with ads that tout the company’s efforts in improving its products. In its “Coming Together” commercial, the Atlanta-based company emphasizes its philosophy of bringing people together and then claims it has reduced calories per serving in its drinks by an average of 22 percent due to smaller pack sizes and low- and no-calorie versions of its drinks. A statement that “all calories count” ends the commercial, suggesting that all industries and consumers share the blame for obesity. However, reactions from New York Mayor Michael Bloomberg’s recent attempt to ban large sodas at restaurants—backed by some media voices, such as CNN’s opinion piece, “Banning Large Sodas is Legal and Smart”—have overshadowed the industry’s efforts to ease concerns over sugar content. Negative attention from health and wellness organizations—like the Harvard School of Public Health saying the drinks cause kidney damage and cancer in addition to obesity—probably won’t help the industry’s 2013 figures either.
Other segments show growth
Premium beverages, such as ready–to–drink (RTD) tea, coffee and energy drinks, advanced during 2012. Energy drinks moved forward faster than all other segments with a 14.3 percent volume increase in 2012, even though the segment is a relatively small share of the industry. The only liquid refreshment beverage types with smaller shares of volume were RTD coffee, which charted the second fastest surge, growing by 9.5 percent, and value-added water, which contracted.
RTD tea grew by nearly 5 percent in 2012.
“Beverages showed gathering strength in 2012,” said Michael C. Bellas, chairman and CEO of Beverage Marketing Corp. “While an improving economy remains the key impetus for beverage category success, the vitality of premium products like energy drinks and RTD coffee shows that Americans’ thirst for both functional and fun products is strong.”
New York City–based Beverage Marketing Corp. is the leading research, consulting and financial services firm dedicated to the global beverage industry.
Coffee consumption increasing
More Americans are turning to coffee than in previous years, according to a report from the Drinks Business Review. A market research study by the National Coffee Association found that coffee consumption increased by 5 percent from the previous year.
Daily consumption has not changed and stays at 63 percent, but those reporting drinking coffee at least once a week increased to 75 percent, the report says.
Thirteen percent of the U.S. population drinks coffee from a single-cup brewer, while drip coffee use has decreased from 43 percent to 37 percent.
The study also found that those in the 18-39 age bracket drink more espresso-based drinks than seniors 60 and older, but consumption by the youngest participants (18-24) declined nine percentage points to 41 percent, while consumption for seniors 60 and older rose five percentage points to 76 percent, the report says.
Landshark Lager, Zac Brown Band Partner For Three Limited-Edition Cans
Landshark Lager is giving longtime and new fans of Zac Brown Band a unique, all-access pass to the band this summer. The Grammy Award-winning Zac Brown Band will be featured on limited-edition 16-oz. Landshark Lager cans. Three can designs will be released throughout the summer, with the first can hitting shelves nationwide this week.
“We’re always looking for new ways to connect with our fans,” said Zac Brown. “We give them our all on stage every night and we hope the Landshark cans will give them another way to enjoy good times with us this summer.”
The cans are more than just eye-catching designs, according to a news release; by “blipping” the Landshark can using the blippar app on smartphones, fans will get exclusive, behind-the-scenes content, with each can design featuring a different aspect of the Zac Brown Band experience. Additional content will be posted to the Landshark Facebook page as each new can is released.
“Just as each Zac Brown Band concert is unique—from the ‘Eat & Greets’ to the moment the band walks off the stage—Landshark is giving fans a unique way to fully immerse themselves in the ZBB experience,” said Michael Lourie, brand manager for Landshark Lager. “Longtime and new followers of the band will get a fun, surprising and intimate view of the band that’s unlike any they’ve seen before.”
On Landshark’s Facebook page, fans will be asked each week to get their “Fins In” for digital challenges that unlock new features from the band. Part of this digital experience includes a national sweepstakes, where one fan and three friends can win a VIP trip to the Southern Ground Music & Food Festival in Nashville, Tenn.
Kicking off the series of custom Zac Brown Band designs, the first can was inspired by the band’s “Eat & Greets,” where fans gather with the band prior to the concert to feast on Southern cuisine prepared by Southern Ground Executive Chef Rusty Hamlin. The design pulls inspiration from Southern dining, with checkered tablecloths and vintage diner signs, as well as Zac Brown Band’s laid-back attitude, with the band leader featured in the center. Subsequent can designs will highlight the concert experience through the band’s eye and what happens after the stage lights go down. The second and third custom cans hit shelves June 17 and Aug. 5.
San Fran Sues Monster For Marketing To Kids Despite Alleged Health Risks
San Francisco City Attorney Dennis Herrera has filed a lawsuit against Monster Beverage Corp. for allegedly violating California law with its marketing of highly caffeinated energy drinks to children as young as 6 years old, despite scientific findings that such products may cause “significant morbidity in adolescents” from elevated blood pressure, brain seizures and severe cardiac events, a news release says.
The lawsuit filed in San Francisco Superior Court earlier this week comes one week after Monster preemptively sued Herrera in a legal attempt to halt his office’s months-long investigation into the marketing and sales practices of the nation’s largest energy drink manufacturer. Herrera’s office had been working with Monster to negotiate voluntary changes to its youth-targeted marketing practices when the Corona, Calif.-based energy drink manufacturer sued the city attorney in federal court on April 29, the release says. Herrera, who has characterized Monster’s litigation strategy as “forum shopping” and a bid to win the race to the courthouse, has vowed to not back down.
“Monster Energy is unique among energy drink makers for the extent to which it targets children and youth in its marketing, despite the known risks its products pose to young people’s health and safety,” said Herrera. “Consumption of highly caffeinated energy drinks by children has been widely condemned by pediatricians and scientists, and the NCAA has banned its member institutions from providing these products even to college athletes because of the grave safety risks. When the U.S. Food and Drug Administration last week announced its investigation into the addition of caffeine to products like Monster, it expressed particular concern about aggressive marketing to young people. Yet Monster Energy remains defiant. As the industry’s worst-offender, Monster Energy should reform its irresponsible and illegal marketing practices before they’re forced to by regulators or courts.”
The FDA has received numerous adverse event reports allegedly related to consumption of Monster Energy drinks, including five deaths and multiple reported instances of illness, injury and hospitalizations. The alleged wrongful death of a 14-year-old Maryland girl from cardiac arrhythmia due to caffeine toxicity after apparently drinking two 24-oz. servings of Monster Energy is the subject of high-profile private litigation currently pending against the company, the release says. Emergency room visits related to energy drink consumption have spiked dramatically in recent years, according to the U.S. Department of Health and Human Services’ Drug Abuse Warning Network, which reported a nearly 14-fold increase in medical events for which emergency invention was sought—from 1,494 instances in 2005, to 20,783 in 2011.
The National Collegiate Athletic Association, which represents more than 400,000 student-athletes at more than 1,000 North American colleges and universities, currently prohibits its member institutions from distributing caffeinated energy drinks to student-athletes. The NCAA has concluded that energy drinks “pose a health and safety risk for student-athletes” and “can have adverse health consequences if consumed before or during strenuous exercise.” Pediatric studies have similarly found that the cardiovascular effects “of heavy caffeine use can be a significant source of morbidity in athletes,” citing new-onset seizures, hypertension, heart palpitations and diuretic effects that can “lead to dehydration in athletes who do not drink enough fluids to compensate,” according to the release.
“Yet despite scientific consensus about the dangers of highly caffeinated energy drinks for youth and young athletes, Monster targets the at-risk demographic with marketing that encourages consumers to ‘pound down’ and ‘chug down’ its products, and assurances that Monster Energy consumers ‘can never get too much of a good thing,’” the release says. “The company’s marketing includes its ‘Monster Army’ website, which uses children as young as 6 years old to promote the Monster brand.
“Other actionable marketing tactics detailed in Herrera’s complaint include the company’s ‘Monster Energy Drink Player of the Game’ series, which photographs high school athletes holding twin four-packs—eight 16-oz. cans, containing 128 ounces of highly caffeinated Monster products,” the release adds. “At 10mg of caffeine per ounce, the photos feature high school athletes, including minors, displaying more than 12 times the generally recommended daily maximum of caffeine for adolescents.”
Herrera’s complaint alleges that Monster Beverage Corp.’s business and marketing practices violate California’s Unfair Competition Law and Sherman Food, Drug and Cosmetic Law. If San Francisco’s lawsuit is successful, Monster Energy could be enjoined from continuing illegal conduct deemed harmful to consumers and competitors, and forced to pay significant civil penalties and restitution as a result of its unfair business practices, the release says.
Coca-Cola Happiness Lounge Showcases POP Materials To Capture Trends
The Coca-Cola Co. brought an extra dose of happiness to the 2013 FMI Future Connect conference in Orlando earlier this week—in the form of the “Happiness Lounge.” Ben Middleton, director of industry communications for Atlanta-based Coca-Cola, told The Shelby Report that the setup allowed the company’s sales personnel to “reinforce some of the major initiatives that we have in the market today—to take advantage of the major trends in the grocery channel.”
Making meal solutions easier
“These are things that are representing great opportunities for retailers to improve their business results through the use of beverages and the other products that they are selling in the store,” Middleton said. “So the idea of combining and bundling ready-to-go meals or meal ingredients is so important because, as you can see here, (over) 50 percent of dinner decisions are made one hour before the meal. Make those meal solutions easy for those moms who are coming in trying to make those things happen.”
Social and mobile
“We’re trying to draw attention to the (Coca-Cola Retailing Research Council’s) work, which is a recent study on the use of social media,” Middleton said. “It’s free to download for the industry and very relevant to how people are using social media in their businesses. It’s no surprise that people are using, in particular mobile devices, in the stores as well so we want to be able to generate conversations around how those trends work and what we can do to help you take advantage of them.”
Above the Basket Display
This piece of equipment “helps put cold drinks right there at the point of purchase,” Middleton said. “So they’re over contributing in terms of profitability for the amount of volume that’s being sold. It’s a pretty attractive proposition through a small footprint; you’re able to deliver a very profitable item at the checkout counter.”
Variety and choice
“…People want lots of choice…because where you’re able to offer people more choices they are happier and they come back more often, they shop more often,” Middleton said. “So for our brands, we have over 650 products…most people know three or four, the handful of brands as a consumer that The Coca-Cola Co. makes, but we have so many in many categories including coffee, tea, juices, bottled water and ways to enhance your bottled water to make those things more attractive. Many of them are low or no calorie, or if your favorite beverage is, like mine, Coca-Cola Classic, you can get that in small can. We have different package sizes available, too.
“That’s really the key insight here,” Middleton added, “being able to provide people lots of choices is a winning formula.” (See the choices and variety display showcased in the Happiness Lounge in the featured photo at top.)
Find more 2013 FMI Future Connect photos here.
Life Is Good, J.M. Smucker Co. Join Forces To Create Coffee Line
Life is Good coffee will be available beginning in late summer. Products will include Light Hearted, a light roast ground coffee; Happy Medium, a medium roast ground coffee; Dark & Daring, a dark roast ground coffee; S’more to Love, a s’more flavored ground coffee; and Banana Bread Bliss, a banana bread flavored ground coffee. All products are UTZ Certified, a program promoting sustainable farming and better opportunities for farmers, their families and the planet.
“Through our new line of coffee with Smucker’s we’ll be able to spread the power of optimism and help kids in need,” said Bert Jacobs, chief executive optimist at Life is Good. “We are grateful to partner with the timeless brand and outstanding team at The J.M. Smucker Company.”
“We are excited about our partnership with Life is Good, which will provide another premium coffee brand option for our consumers,” said Mark Smucker, president of U.S. Retail Coffee at The J.M. Smucker Co. “Life is Good is a great fit with our family of brands and will undoubtedly resonate with our consumers as it supports our sustainability initiatives as our first line of 100% certified coffee.”
This is the second partnership in Life is Good’s Best-In-Class (BIC) business unit, which is designed to extend the Life is Good brand through partners who are the leaders in their existing product categories.
Coke Zero To Offer Caffeine-Free Option
Coke Zero, the only soft drink on the North American market to post double-digit sales growth for five straight years, is adding a new choice—Caffeine Free Coke Zero.
“Caffeine-free products are growing in popularity, making up nearly 30 percent of all sparkling beverage sales in the U.S.,” says Stuart Kronauge, head of sparkling for Coca-Cola North America Group. “By introducing Caffeine Free Coke Zero, we’re giving fans exactly what they want, making the brand accessible for enjoyment all day long.”
The launch of Caffeine Free Coke Zero is part of a broader strategy designed to make the fast-growing brand even more ubiquitous and available to consumers at any time throughout the day. Coke Zero has become increasingly visible in recent years through a variety of high-profile marketing initiatives, including:
• Sponsorship of the 2013 NCAA Men’s Final Four;
• Title co-sponsorship of ESPN’s College GameDay, the annual season kick-off to the college football season; and
• Sponsorship of Coca-Cola Racing Family member Danica Patrick and her No. 10 Chevrolet SS in the NASCAR Sprint Cup Series.
Caffeine Free Coke Zero will begin appearing on shelves in supermarkets, drug stores and mass merchants nationwide in mid-July, and will be available coast to coast in August. It will be packaged in 12-packs of 12-oz. cans and 2L bottles. In addition, the company will offer opportunities for people to sample the beverage.
Coke Zero is the 12th brand in The Coca-Cola Co. portfolio to reach $1 billion in global revenue, and it is the most successful newly launched sparkling beverage in decades, according to Atlanta-based Coca-Cola.
GMA Announces Findings Of CPG Industry ‘Big Data’ Research
The Grocery Manufacturers Association (GMA) today released the 2013 report “Formula for Growth: (Innovation); Big Data & Analytics,” completed in collaboration with Deloitte Consulting LLP. The report is the culmination of more than 10 months of broad-based industry research led by Deloitte and contains five specific conclusions and recommendations for how food, beverage and consumer packaged goods (CPG) companies can convert emerging forms of “big data” into useful analytics and insights to improve business results.
Available exclusively to GMA member companies, the web-based, interactive application also includes a profile of top emerging technological and digital innovations that will usher in vast quantities and new forms of data for the CPG manufacturing and retail industry.
“Working closely with Deloitte, the GMA Information Systems Committee set out to help demystify the potential big data opportunities for the CPG industry and to better understand how we can continue to improve our overall analytical maturity using both existing and emerging sources of big data,” said Andy Platt, VP of enterprise analytics and insights for The J. M. Smucker Co. and chair of the GMA Information Systems Committee. “The goal of the research is to provide CPG companies with real and practical opportunities for leveraging the growing variety of available data and to drive insights for more effective decision making, ultimately leading to top- and bottom-line growth.”
“It is hard to understate the importance of this report,” said Pamela G. Bailey, GMA president and CEO. “Consumer packaged goods companies are focused on growth like never before and it is clear that big data is an important driver of innovation and business growth. Deloitte and the Information Systems Committee are to be commended for the insights they developed and the roadmap they have created for trading partners seeking to innovate and expand.”
As part of the study, Deloitte incorporated a broad view of opinions and perspectives from cross-functional teams within leading GMA member firms, prominent thought leaders from the finance, technology and innovation communities, and notable academics and technology innovators.
“The research will assist CPG companies in understanding the broad set of capabilities and competencies required to improve their analytical IQ, with big data making that need even more urgent,” said Marcus Shingles, principal at Deloitte Consulting LLP and enterprise innovation and analytics practice leader for Deloitte’s consumer products sector. “The emphasis is on the need to think beyond data tools and techniques, and focus on analytical talent models, decision processes and cultural shifts. With the ‘new normal’ of rapid-pace technological and digital innovation, CPG companies will depend now more than ever on big data analytics to compete and grow.”
The five specific conclusions and recommendations identified in the research are:
1. Few have the required analytical foundation in place over the last decade: the majority of CPG industry firms have not progressed beyond localized analytics and are still challenged to capitalize on their “small” existing data (internal and structured). Conversely, a handful of CPG firms have improved their analytical maturity to become strong analytical companies and therefore have the required foundation to capitalize on new emerging sources of big data.
2. Rapid-fire pace of innovation requires data and analytics competency: the rapid-fire pace of technological and digital innovation has the potential to define winners and losers in the CPG industry, and an integrated core competency around small data, big data and analytics is a requirement for the winners.
3. Industry is moving from linear change to exponential disruption: until now, a CPG company’s competitive advantage did not depend on having strong analytical maturity; however, the industry’s preconceived notion of change is about to be disrupted by the exponential pace of innovation. Navigating this landscape will require companies to harness data and efficiently convert it to insights.
4. Business context required—integrated and cross-functional business planning and execution: the “Formula for Growth” is most impactful when applied in the context of cross-functional and integrated business planning and execution. Whether small or big data, the goal is to consistently make better decisions to improve an organization’s planning and execution toward achieving top- and bottom-line growth objectives.
5. Cultural shift—the characteristics and traits of the new industry “winners”: this new “exponential” pace of innovation will require a culture of experimentation, trial and error and other methods that enhance a company’s ability to remain agile, fluid and adaptable. A strong vs. weak data and analytical maturity is one of the key differentiators between a CPG company that effectively navigates this new era of innovation and one that falls victim to the exponential pace of change.
GMA members may access the research online here.