March 1, 2006
By JENNIFER KOROLISHIN
Former beverage execs’ new venture revives the No-Cal Soda brand
Going from being a top beverage company executive to running a start-up can be a surprisingly tall order. Fortunately, Mike Weinstein, former Snapple Beverage Group chief executive officer, and Brian O’Byrne, former Yoo-Hoo/Orangina Co. chief executive, are up to the challenge.
Collectively, the pair, who met while working together at Cadbury Schweppes, marketed beverage brands including Snapple, Yoo-Hoo, Mistic, A&W, Stewart’s, Orangina, Squirt, Vernor’s, RC and Diet Rite. But after taking early retirement, both were itching for a new challenge. They partnered to form INOV8 Beverage Co. LLC in January 2005.
“The whole idea was to create trademarks, concepts, strategies and packaging, and to develop flavors and brands, and either sell them to bigger companies or commercialize them ourselves,” O’Byrne says.
As a small company, INOV8 lacks a large infrastructure, so selling ideas at the concept stage was its original thrust. However, that’s been a challenging process. “The one thing we have discovered is that larger companies are not really open to outside ideas as much as we thought they would be, or in my opinion, should be,” Weinstein says. “The ‘not-invented-here’ syndrome is very strong. We felt that getting a product into the marketplace and getting a little bit of buzz about it will make them easier to sell than at the idea stage.”
The pair chose No-Cal Soda-Pop, the original diet soft drink, as its first project. The No-Cal brand dates to 1952, when it was developed as a sugar-free soda for diabetics. Today’s carbonated, no-calorie soft drink is available in four flavors: Clementine, Cherry Lime, Chocolate and Vanilla Cream.
No-Cal was popular in the New York City area where Weinstein grew up. As he and O’Byrne searched for a diet drink idea, Weinstein began digging into what had become of the brand. Research revealed that the trademark was abandoned, and a No-Cal revival was on.
“We did some consumer research and we found the idea of using that original name as a vehicle to give us a retro feel around a brand, which is a hot trend particularly among young people, and as a brand name that exactly described the proposition without having to use the word ‘diet,’ was a strong one,” Weinstein says.
No-Cal is positioned to appeal to consumers seeking healthier drinks with great taste, but it’s also designed to inject a sense of fun into the category.
“The whole idea of drinking soda, there’s no fun anymore in doing it,” O’Byrne says. “It used to be if you drank a soda, it was a treat. What we wanted to do was to add some fun back into drinking soda. We wrote some awfully corny poems and put them on the back of each bottle, created a character for each flavor to give it an amusing touch and wrote stories about the characters. It’s a product that reminds us of simpler times.”
Today’s No-Cal isn’t an exact replica of the original recipe. Instead, Weinstein and O’Byrne worked with ingredient company Givaudan to create the updated product.
“Because we’re so small here, it was like the movie Ocean’s Eleven — we decided to round up all the guys we like to work with, Givaudan being one of the flavor houses that really had worked well with us,” O’Byrne says. “We wanted flavors that had no diet aftertaste, and a mixture of New Age flavors like Clementine or Cherry Lime, and old-fashioned flavors. Chocolate was one of the original No-Cal flavors, and Vanilla Cream is a gourmet, old-style soda.”
The product is co-packed by Crystal Soda Water Co. in Scranton, Pa., which produces a number of gourmet sodas in glass bottles.
“We wanted to start out in glass because it’s a great package to communicate retro,” Weinstein says. “We think that as this evolves, it can easily go into multi-serve plastic, or for that matter, into other forms that are perhaps not carbonated, such as a No-Cal iced tea.”
Sold primarily as a four-pack, No-Cal’s distribution network started close to INOV8’s Westchester County, N.Y., offices and has fanned out to encompass New York’s five boroughs, Long Island, Northern and Central New Jersey, and soon, Connecticut and Rhode Island. Supermarkets including D’Agostino, Fairway Market and King Kullen carry No-Cal, and many New York delis also sell single-serve bottles.
Hitting the streets
Weinstein and O’Byrne tapped industry contacts to establish No-Cal’s distribution network, but it has also required some hard work. “Having been in the business, we know a lot of people, but not having a big staff, you’re out calling on everybody,” Weinstein says. “Probably the hardest part is just not having the arms and legs to get it done.” They also employ public relations services, but have focused resources on production and distribution rather than investing in traditional advertising and marketing.
While their industry experience is valuable, manning a start-up has posed some interesting challenges for Weinstein and O’Byrne. As major beverage company executives, they depended on an army of brand managers, marketing managers and salespeople, but now do everything themselves. One example of their learning curve was when they realized neither one knew how to go about getting a UPC code for No-Cal’s packaging.
“That’s just an illustration of some little things that we have no idea how to do,” O’Byrne says. “The brand manager would know exactly how to do that in two minutes, so it was a lot of learning. You’re dealing with the guy who stacks the product on the shelf, the store owner, the distributor’s salesperson, the owner of the distributorship, designers —everybody from top to bottom. We have a far greater appreciation now of people who are on the front lines.”
Going forward, Weinstein and O’Byrne plan to add more No-Cal flavors this fall as they continue working on other ideas.
“One idea is around what we call the ‘better drinking’ category, which are healthier ingredient drinks,” Weinstein says. “We have what we think is a blockbuster idea, a very different way to think about energy drinks.” BI