Coca-Cola, Nestlé Narrow Joint Venture
The Coca-Cola Co.,
Atlanta, and Nestlé, Vevey, Switzerland, have further redefined
their Beverage Partners Worldwide (BPW) partnership, narrowing the
companies’ collaboration to countries outside the United States, and
to tea products only.
Under the new agreement, BPW will cease activities in
the United States, with the Coca-Cola Co. entering into a Master Sublicense
Agreement for the ready-to-drink Nestea and Enviga brands. Both companies
will be able to acquire or develop additional tea brands on their own to
compete in the United States. All BPW coffee products will revert to
Nestlé on a market-by-market basis during a transition period that
will end no later than the end of next year. BPW also will not operate in
In other Coca-Cola news, the company came under fire
last month from the Teamsters Union, which called for rallies at NCAA
Men’s Basketball Tournament games and held a protest in New
York’s Times Square. The union cited job cuts at Coca-Cola
Enterprises as one of the reasons behind the protests.
Kraft goes it alone
Kraft Foods, Northfield, Ill., has begun operating as an independent
company, following its spin-off from Altria Group late last month. The
company will trade on the New York Stock Exchange under the KFT symbol.
With the move, Irene Rosenfeld added the title of chairman to her role as
chief executive officer. Previous chairman Louis Camilleri will continue to
serve on the Kraft Board.
"As a fully independent company, we'll have more
opportunity to fulfill the potential of our great brands and great company.
We're confident we have the right plans in place to deliver attractive
returns to our shareholders,” Rosenfeld said in a statement.
Advertising review published
The Distilled Spirits Council (DISCUS), Washington, D.C., issued its Semi-Annual
Report detailing complaints about alcohol advertisements, actions taken by
the industry’s internal review board and the response by each
advertiser. The report covers Code Review Board actions during the second
half of 2006, and indicates complaints were made against 16 advertisements.
Nine of the ads were found in violation by the Code Review Board, and of
those, only one company failed to take corrective action.
“While this recent report continued to show 100
percent compliance by Distilled Spirits Council members with Code Review
Board decisions, importantly, there also was overwhelming compliance by
non-members,” said DISCUS President and Chief Executive Officer Peter
Cressy, who noted that of the seven non-DISCUS member ads found in
violation, six were pulled. The full report can be found at discus.org.
Natural products reach a tipping point
The Natural Products Expo
West, held last month in Anaheim, Calif., drew 47,000 attendees and more
than 3,100 exhibits, proving the natural and organic trend is stronger than ever. Eric Schlosser, author of Fast Food Nation, gave the keynote
address, telling the audience of natural products manufacturers and
retailers they no longer were a fringe movement but a bona fide part of the
food and beverage market. “You now have an industry — a big,
big industry,” he said.
“The question is: How are you going to use
it?” he asked, pointing out that, “If this industry loses sight
of what it was based on, it risks becoming what it opposes.”
Americans are at a sort of tipping point, Schlosser
says, where environmental issues and health concerns are top of mind, and
if the organics industry walks the line, it could pull a large portion of
mainstream consumers into the industry. But he warned, “People are
very savvy and becoming more savvy.” Organic companies, that put
profits above all else are in danger of making the industry appear false
and insincere. “Companies that profess one set of values and act on
another are going to be outed,” he said.
New products packed the show floor in Anaheim, but no
overarching theme for beverages emerged this year. Dr. Andrew Weil was
on-hand to showcase his new Dr. Andrew Weil for Tea, a line of teas created
in conjunction with Ito En North America, Brooklyn, N.Y. The line includes
ready-to-drink Gyokuro, Green White blend, Jasmine White, Darjeeling and
Tumeric teas packaged in 8-ounce cans, as well as loose tea, tea bag
products and a premium Matcha line. Tumeric tea is unfamiliar to most U.S.
consumers but Weil says it is one of the best ways to ingest tumeric, which
has anti-inflammatory properties, is a powerful antioxidant and supports a
healthy heart and nervous system.
Celestial Seasonings, Boulder, Colo., rolled out new
Saphara full-leaf teas made from organic and Fair Trade ingredients. The
teas are packaged in biodegradable pyramid bags and pouches. The company
also introduced Go Stix Kids’ Drink Mixes with 50 percent less sugar
than traditional juice drinks.
The Healthy Beverage Co., Newtown, Pa., showed off its
Steaz Energy organic energy drink made from Fair Trade certified green tea,
Guayaki yerba mate, acai and guarana.
The Republic of Tea, Novato, Calif., introduced new
Ginger Peach Green Tea to its Daily Green Tea line, which features a
variety for each day of the week. The company also rolled out a new Double
Green Matcha Tea, and Superfruit Teas in Palmberry Green Tea and
Pomegranate Full-Leaf Green Tea varieties.
In addition, Republic of Tea has teamed with Luna to
create organic bottled Luna Nutritional Iced Teas for Women. The group from
Luna was on-hand at the show to sample the other end of the partnership,
Luna Tea Cakes made with Republic of Tea teas and herbs.
Clif Bar & Co., Berkeley, Calif., has moved into
the beverage arena with powdered drinks for kids. Splashers are part of
Clif’s new children’s line and contain vitamins C and B, as
well as calcium and electrolytes.
PepsiCo’s newly acquired Izze Beverage Co.,
Boulder, Colo., launched its first line extenstion, Izze Esque. The product
is a lower-calorie version of Izze, containing half the calories with no
sweeteners. The company’s Tropicana division debuted Tropicana
Organic Orange Juice and Orchard Medley pear and apple juice.
Frutzzo Natural Juice LLC, Minneapolis, showed off the
new Pomegranate Passion Fruit addition to the organic pomegranate juice
Coca-Cola’s Odwalla sampled flavors of its new
Soy Smart soymilk drinks in Chocolate, Chai and Vanilla flavors. The
company also has entered into a distribution agreement for Bossa Nova acai
juices, and showcased those as well.
Taking coffee into the soft drink arena, Java Pop Inc.,
Woodstock, Vt., introduced its Java Pop Coffee Soda to attendees. The
product is available in Vanilla, Espresso, Mocha, Hazelnut and Caramel
flavors. And Apple & Eve, Port Washington, N.Y., gave attendees a chance to try its Organic Pome-granate juice, packaged in
48-ounce PET bottles.
On-premise show ranks spirits high
The 2007 Bar &
Nightclub Show held last month at the Las Vegas
Convention Center featured several keynote speakers and an exhibit hall
full of new spirits, beers, energy drinks, waters and mixers for the more
than 30,000 professionals who attended the show.
The State of the Industry Keynote Address was given by
Peter Cressy, chief executive officer and president of the Distilled
Spirits Council of the United States, who said on-premise spirits sales are
up 58 percent from $21 billion in 2000 to more than $33 billion at the
beginning of this year. The extraordinary growth isn’t replicated by
many other U.S. industries, he said. Spirits industry sales are expected to
continue to grow at a slower pace to $35 billion for 2007, the speaker
Cressy attributed the growth to more consumers
drinking, but drinking in moderation; good work from all three tiers; the
move from premium to super-premium brands; the popularity of cocktails;
clever on-premise marketing programs and sharp national advertising.
Pernod Ricard USA’s Chief Executive Officer and
President Alain Barbet also gave a keynote address that attributed Pernod
Ricard’s success to premiumization and innovation. Included in Pernod
Ricard’s innovation plans are the new product launches of Malibu
Tropical Banana, Kahlúa French Vanilla, Kahlúa Hazelnut and
Hiram Walker Pink Grapefruit and Hiram Walker Pear Schnapps.
Master Mixologists Tony Abou-Ganim and Dale DeGroff
both spoke about the “craft of the profession,” and urged the
move back to fresh juices and ingredients, and the importance of
professionals creating their own drink menus.
Andy Thomas, Heineken USA’s chief executive
officer and president, closed out the keynote speakers by focusing on how
Heineken is finding opportunity in the consumer trends of trading up,
health and wellness, ethnic diversity, connection and socialization,
individuality and variety, and the need for stress relief. Broadening
Heineken USA’s “luxury light” portfolio, the company
launched Tecate Light in Texas in March and will release Heineken Premium
Light in cans in May.
The packed show floor surged with new beverage products
for the on-premise scene. The overriding theme of product launches included
new flavor additions, sugar-free extensions, licensed products and Asian-themed beverages (see Beverage
Industry’s March article “Asia
Invasion in Vegas” at bevindustry.com).
In the flavor arena, Future Brands LLC, Deerfield,
Ill., launched two new additions: Absolut Pears and DeKuyper Pomegranate
Liqueur. In licensed agreements, Sidney Frank Importing Co., New Rochelle,
N.Y., displayed its new Tommy Bahama Golden Sun and Tommy Bahama White Sand
Rums, which will launch this spring.
New York City-based G Pure Energy, from the makers of
Voss water, added a light version of the original lime and lulo flavor as
well as an Orange Blossom variety in light and regular versions.
Anheuser-Busch, St. Louis, expanded its line of 180 Energy Drinks with 180
Red with Goji Energy Drink, a cherry-flavored energy drink with tartness
added by the goji berry.
Additionally, Rockstar Inc., Las Vegas, displayed its
new flavor addition Rockstar Juiced Energy + Guava,
with tropical guava puree and other fruit juices. The company also debuted
Rockstar Zero Carb Energy Drink, a lightly carbonated, wild berry-flavored,
no-carbohydrate version of Rockstar. BI
Get your product noticed
Beverage Industry sister publication Stagnito’s New Products Magazine recently teamed up with Schneider & Associates and
Information Resources Inc. to determine what makes products memorable and
what kind of marketing entices consumers to purchase a new product. They
presented the results at the IRI Summit in Las Vegas.
“What we wanted to do was find out which were
the most memorable new products of 2006, measure awareness of products and
how consumers got information — the trends that might influence
purchasing behavior,” says Joan Holleran, editor of Stagnito’s New Products Magazine.
Using IRI sales data to determine the most financially
successful products of the year — and thus, the products that should
be the easiest to recall — the companies created a consumer survey on
new product awareness. According to the results,
81 percent of consumers could not recall one of the Top 50 new products
launched during 2006.
The food and beverage products that scored highest in
awareness were Wish-Bone Salad Spritzers (with 46 percent awareness), V8
V.Fusion (43 percent), Dr Pepper Berries & Cream (39 percent),
Coca-Cola Blak (33 percent); Campbell’s 25% Less Sodium Soup (30
percent), Hamburger Helper Microwave Singles (29 percent), Folgers Simply
Smooth (28 percent), 7 UP 100% Natural (28 percent), and Birds Eye
Steamfresh Fresh Frozen Vegetables (28 percent).
According to Holleran, some of the concepts that helped
make a new product stand out include:
• Demystifying taboos — creating solutions to
problems consumers previously have not wanted to talk about
• Life enhancing messages
• Consumer control
• Multiple problem solvers
• Easy virtue
• Single-serve/portion control products
• Do-it-yourself products
• Just-for-me/customizable products
Despite fears that the popularity of TiVo and cable
TV’s digital recording services would make television commercials obsolete, 73 percent of survey respondents said they
learned about new products last year from TV commercials and infomercials.
In-store displays and signage were the second most successful form of
Ninety-six percent of respondents indicated they are
“very likely” or “somewhat likely” to buy new
products they have tried through free sampling. More than half say they
often recommend products to family and friends, and nearly as many said
they usually try a product recommended by a friend or family member.
Cutting through the clutter is the most important goal
for marketers, the group said. The research team coined the term
“Immersion Marketing” to encompass everything from traditional
advertising, public relations, word-of-mouth advertising, digital
marketing, sampling, coupons, retail partnerships, and any other way of
surrounding the consumer with a consistent message about a brand. The
all-encompassing approach to a new product launch allows companies to
create “multiple touch points” over time that will motivate
consumers to try new products, and creates more targeted messages so the
right consumers are hearing about the right products.