Caballo Negro
August 1, 2006
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Caballo Negro
By SARAH THEODORE
The dark horse in the energy drink running
Energy drinks are the
fastest-growing category in the beverage industry, and Hispanic consumers
are the group every beverage marketer wants to reach — which places
Latino-inspired Caballo Negro in the middle of one the hottest beverage
markets out there today. A product of Distribuidores De La Energia, based in Burlingame, Calif., Caballo Negro was
developed, from flavor to packaging, with Hispanic consumers in mind.
“Everything about the drink was done by Latino
people,” says company owner Arley Campbell, who says his product
development partners considered a number of options for the product name
and surveyed potential consumers on their preferences. Ultimately, the
Caballo Negro name and the image of the black horse were chosen for the
strong, masculine feeling they conveyed.
“Every day we took new ideas and presented those
ideas [to consumers],” Campbell says. “We’d go to swap
meets, flea markets and shopping malls and sit down with people and talk to
them about what they liked.”
The group spent several months working on the taste
profile alone, coming up with a sweet-and-sour flavor that is unique to the
energy drink category. Campbell says the flavor has been tweaked several
times since the product was created in order to achieve the perfect balance
between sweet and sour. “In the very beginning, when someone would
take a drink, they would do the whole pucker thing, like they just tried a
persimmon that wasn’t ready,” he says. And while Caballo Negro
still does not have a sweet profile, he says, “It’s not
anywhere near that sour now.”
In addition to traditional energy ingredients, the
company also has incorporated ingredients that are well known in Latin
American countries. Una de gato, or cat’s claw, is one of those
ingredients. The Peruvian herb has long been touted as a remedy for
countless ailments. Other functional additions to the beverage include
taurine, glucuronolactone, pantothenic acid, inositol, ginseng,
guaraná, vitamin B12, vitamin B6, niacin and horny goat weed.
For an extra energy punch, Caballo Negro contains
three times as much caffeine as the leading energy drinks on the market.
“It’s certainly a high-energy energy drink,” Campbell
says. “We put the maximum amount of energy ingredients in it that we
thought were a good idea.”
The Caballo lineup includes an 8-ounce product, as
well as the Caballo Negro Double Kick, a 16-ounce version of the product.
And soon to hit the market will be Caballo Zero, a zero-calorie,
zero-carbohydrate product sweetened with Splenda.
While the trend these days is toward larger sizes of
energy drinks, Campbell believes it is important to maintain the
traditional 8-ounce size.
“We still have many stores that have full
shelves of 8-ounce and full shelves of 16-ounce, right on top of each
other,” he says. “The 8-ounce has its own market. I think many
people have missed that boat. As they abandon the 8-ounce market and go to
the 16-ounce market or the 24-ounce market … what you’ve done
is basically leave Red Bull all alone again.”
He says Distribuidores De La Energia had no intention
of getting into larger sizes, believing it contained enough functional
ingredients in the 8-ounce products. But consumers spoke and the company
developed the Double Kick size in response.
“The reality is that people are value-conscious
and they want volume,” Campbell says.
Caballo Negro is available in 37 states and Mexico
through a hybrid distribution system of soft drink bottlers, beer
wholesalers, and in some cases, food distributors. The majority of the
company’s sales come from the convenience store channel and small
Hispanic retail locations.
Without a background in distribution, Campbell says
the group learned some difficult lessons while trying to get its product to
market. “We spent a year spinning our wheels, and since then
we’ve spent the past year really progressing and doing really well as
a result of learning from those mistakes we made the first year,” he
says. “You learn from your mistakes and we’re quick
learners.”
South of the border
Caballo Negro is available in Mexico as well as the
United States, with a few — perhaps unexpected — differences.
The Mexican product is labeled in English as Black Horse, with Caballo
Negro appearing at the bottom of the can — exactly the reverse of its
U.S. packaging.
“In Mexico, people want products that are
American,” Campbell says. “It was actually the people in Mexico
who asked me to consider changing the name of our product.”
Caballo Negro is available in several parts of Mexico,
including Guadalajara, Tampico and Monterrey, and soon will be available in
Mexico City. Campbell says the south-of-the-border energy drink market
differs from the U.S. market in that consumers are hesitant to accept
larger sized products such as the 16-ounce can. He says Caballo Negro
currently is the only such product in Mexico. “We welcome the
entrance of Monster and Rockstar into the Mexican market because we believe
it will help make the 16-ounce drink more acceptable,” he says.
Looking toward the future, Distribuidores De La Energia plans to continue its new product
development efforts, including new sizes and entirely new products. The
company markets its products through a grassroots combination of event
marketing, radio advertising and community involvement, and says Caballo
Negro has broad appeal that extends far beyond its original Hispanic
target.
“Some of our more successful areas are Anglo
areas where there are very few minorities, which blows us away because we
didn’t believe that would be true,” Campbell says. “But
customers will prove you wrong. If they like it, they like it, and it
doesn’t matter where you are.”
