Decades ago, Ralph Lauren, then working at Brooks Brothers, thought that men might be interested in donning bolder colors with their clothes and ties. So in 1967, he brought this idea to fruition when he began selling ties and then went on to launch the Polo brand the following year. His entrepreneurial ambition eventually became the multibillion dollar Ralph Lauren Corporation.
The stories of iconic entrepreneurs like Lauren have served as inspiration for many aspiring entrepreneurs as they look to disrupt the status quo of many industries. In today’s beverage market, the future for leaders are coming of age in a time where entrepreneurs are seeing consumers embrace new age beverage companies.
“I think right now, especially in the world that we live in today, that now is a better time than ever before to be an entrepreneur,” says John Fieldly, CEO of Celsius Holdings Inc.
Fieldly has truly seen how this time has come to fruition. Named CEO of the Boca Raton, Fla.-based company in April 2018, he first began his time at Celsius Holdings in 2012 as chief financial officer. During this tenure, Fieldly has seen the company not only produce clinically backed energy drinks that today’s consumers demand, but also demonstrates the discipline to produce a true return on investment to shareholders.
“In general, there’s a way to tie the CEO component and entrepreneurs like myself to building a brand and understanding profitability and being disciplined. I think it’s critical as well as you look at a lot of growth brands,” he explains. “One thing I think as a company is we are disciplined on our investments and driving that through the organization is the focus on discipline, execution and return on investments.”
This is exemplified in Celsius Holdings’ 2022 second quarter financials report, in which the company reported revenues of $154 million, a 137% increase compared with 2021 Q2 reports. For the six months, the energy company has registered $287.4 million in revenue, a 150% increase compared with last year at this time.
Yet, what might be more impressive is the retail growth that the company has achieved. Its U.S. store counts now exceed 169,000 locations nationally thanks to adding more than 59,000 store fronts, a 54% increase, from 2021 Q2. Some of its biggest growth has been in convenience and club store channels as well as eCommerce.
In convenience alone, the company went from 20,000 location to more than 82,000.
“We’ve expanded in the convenience channel rapidly, which is really exciting,” Fieldly says. “… If you’re looking at 2021 distribution that has been phenomenal for us is we’re the No. 2 energy drink brand on Amazon as of the third quarter. We’ve expanded into the club channel in a huge way. We’ve expanded to all of the Costco and Sam’s Clubs and are starting to expand into BJ’s so the club channel is a massive channel for the company now that has really transformed and grew overnight that we’re really excited about.”
And the company is in position to add more locations. On Oct. 1, the first cases of Celsius were loaded onto PepsiCo-associated delivery trucks thanks to an August announcement that Celsius and PepsiCo entered into a long-term strategic distribution agreement.
Through the agreement PepsiCo acquired certain Celsius distribution rights in the United State with future expansion opportunities as a preferred distribution partner.
“The biggest opportunity we see is in the convenience space as well as independent,” Fieldly says. “They have a medals program that gives us access to potentially over 100,000 to 150,000 independent locations through their loyalty program. In addition, it provides access to over 61% of the colleges and university population where we’ll have availability on campus and we know the product is resonating with college students so we’re really excited about that and it will open us up to foodservice.”
Additionally PepsiCo made a $550 million investment in Celsius convertible preferred stock. “When you look at the company, we’ve been driving profitable growth,”Fieldly explains. “When you look at the investment that has come in, the $550 million it’s worth in capital, it’s going to allow us to be more nimble and it gives us flexibility on our balance sheet as we continue to scale and grow and take advantages of opportunities. It will allow us to compete. Right now we’ve got cooler investments. We see great opportunities in placing additional coolers at key accounts, really to give us that shelf space and that presence like the leading brands.”
These achievements exemplify the hard work from the Celsius Holdings’ team, Fieldly states.
“As CEO of Celsius it’s got to go back to the team,” he says. “A great team that’s being qualified by PepsiCo I think is a major achievement for the organization, one we’ve always dreamed about and just came true in August 2022. I think that’s a major, major milestone for the company and allows us to compete against the larger CPG brands in the energy space and the category. That’s a major milestone being able to overcome that and it’s not just me. It’s the team that made that happen.”
For these reasons and many more is why Beverage Industry has named John Fieldly as our 2022 Executive of the Year.
A new energy market
Celsius Holding has long been a contributor in the performance energy sector with its same-named CELSIUS lifestyle fitness beverage. However, what allowed the CELSIUS brand to move from a more niche to broad consumer base is how the U.S. energy market has evolved is recent years.
“The current energy beverage is really evolving,” Fieldly explains. “It’s still dominated by two of the largest players in CPG, but the category is evolving and new consumers are entering the category for the first time. I think over the last several of years, energy is broader than the traditional energy drink category. Consumers see it as a beverage. We’re all working harder. Our lives are busier than ever before. Everyone needs more energy and you’re starting to see the lines blur with isotonics and energy and CSD and energy. I think it’s a really great time for Celsius and for the energy category for going after total beverage ― I think [that] is really the next frontier here.”
One mega trend impacting not just food and beverage, but also apparel and other consumer packaged goods is health and wellness, Fieldly notes.
“I think when you look at health and wellness there’s more consumers now that are millennials and Gen Z that have gym memberships than ever before,” he says. “There are now more gyms, boutique gyms, variety of activities exercises, Peloton and health and wellness is hip, cool and sexy and it’s changing the way we live, the way we think about fitness and the way we think about ourselves so it’s more engrained in the lifestyles of today’s consumer than ever before. We don’t see that trend slowing down. And that’s not only in North America. That’s a global trend.”
This mega trend ties into three trends that is giving life to what Fieldly says many are calling new age energy.
“I think when you look at the category and you look at where CELSIUS plays, we’re capitalizing on three of fastest growing trends in food and beverage and that’s affecting the energy category as well,” he says. “No. 1, everyone wants better for you ingredients but they don’t want to sacrifice flavor. That’s where we deliver on. We bring seven essential vitamins, no crash, no jitters and we bring great flavor profiles.
“No. 2, the other trend in food and beverage and also in the energy category is we want more out of our energy drinks,” he continues. “We want more than just energy. We want additional function in the food and drinks we consume. In the energy category, if you look at CELSIUS, we offer that clinically functional metabolism in burning body fat so it allows you to achieve your health and wellness goals, so it’s more than just an energy drink.”
The third trend is tied to the rise in fitness that Fieldly mentioned earlier. “Fitness is a lifestyle. It’s premium,” he explains. “It’s a mega trend that’s affecting all categories and the energy category.”
As fitness has grown to become a lifestyle, Fieldly highlights how CELSIUS has engrained itself in that community before it reached the level its attained today.
“Fitness is part of a daily lifestyle, a daily routine and we want product that resonates with our lifestyle and that’s where CELSIUS fits in as a fitness lifestyle beverage,” he says. “Born in fitness, but now appealing to a broader audience than ever before, and we don’t see those trends slowing down. It’s for your day. It’s for inside the gym, outside the gym. It’s all about living healthy and living fit, and CELSIUS delivers essential energy for life and that’s what we’re all about. We don’t see this changing. The brand is resonating with a much broader consumer and we feel that we’re very well positioned for today’s consumer.”
The CELSIUS journey
As the U.S. energy market evolves, the CELSIUS brand has seen its products truly resonate with a broad, diverse consumer market.
“In regards to our CELSIUS core portfolio, we have over 14 great flavors,” Fieldly explains. “We do have carbonated and non-carbonated. When you look at the usage occasions and the need state, we’re really seeing our core portfolio resonating today with a broader consumer than ever before. Prior it was mainly at the gyms and the health clubs and pre-workout. Now, we’re seeing usage occasions expand to before lunch, during lunch.”
Fieldly adds that he thinks these occasions are ideal for CELSIUS because of its flavor profiles.
“We think that’s a massive opportunity in the food and on-premise [channels] as well as outward locations,” he says. “Then we also see opportunities in the afternoon when you need an afternoon pickup ― CELSIUS is great offering for that. We are seeing the energy category, our core CELSIUS portfolio, evolve out of that fitness as we gain broader distribution.”
However, the core CELSIUS line is not the only way the company is delivering performance needs to consumers. It also offers the lines CELSIUS HEAT, CELSIUS BCAA +Energy, CELSIUS On-the-Go, and CELSIUS Sweetened with Stevia.
Designed to optimize performance, CELSIUS HEAT contains 2,000 mg of L-citrulline and 300 mg of caffeine. Meanwhile CELSIUS BCAA +Energy is an amalgamation of BCAAs, tart cherry, vitamin D3 and caffeine designed to reduce inflammation and fuel recovery, the company notes. With CELSIUS Sweetened with Stevia, the line features the same clinically proven ingredients as its core line, but is sweetened with stevia and naturally caffeinated with green coffee bean extract. And lastly, the CELSIUS On-the-Go portfolio contains the same clinically proven ingredients as the core line, but supports a traveling need state.
“When you look at our powder line, their exactly the same as our RTDs,” Fieldly says. “The only difference is it doesn’t include the water, but it comes in great flavors as well. It’s on the go. It allows you to fit it in your book bag or your purse and your suitcase and take it on the go. We’re seeing a lot of great demand for that. It allows people to consume CELSIUS when they want it and how they want it, so it’s not really a different usage occasion in consumers we’re going after. We’re really going after this broader consumer in energy that’s looking to live healthier, looking to live a healthy active lifestyle and aligning with a broader consumer today.”
Indeed the Celsius Holdings’ portfolio is offering a host of products that support varying usage occasions, but a consistent across all lines is its commitment to flavor choices.
Most recently the company expanded its Vibe line, a line within its core CELSIUS brand, with the launch of Artic Vibe. “We’re bringing a frozen vibe to the beaches of Miami and all around the country,” Fieldly says. “We’re really excited. It’s a frozen berry flavor. It tastes great, especially during summer.”
Artic Vibe is the third flavor released within the Vibe family, which fit debuted in 2020 with Peach Vibe.
“Our Vibe line we launched to really go after more of a traditional energy drink consumer,” Fieldly says. “We feel it’s more inviting plus we’re able to have more fun with some of the flavor combinations. We did launch our Peach Vibe during COVID, we came out with our Tropical Vibe, which is a great flavor, and then we just launched the Artic Vibe this summer with great success.”
The traditional core line also added Strawberry Lemonade prior to summer this year, and Fieldly notes that many have expressed how refreshing the product is. Adding how excited he is for both the core CELSIUS line and its Vibe extension, Fieldly teases there will be more to come in terms of flavor innovations.
“We’re going to continue to bring great flavor profiles in 2023,” he says. “We’re excited about some of the new innovation we have not only in our core product but also in our Vibe line as well, so we’ll have more great news to come in 2023.”
Still, as excited as the company is about its flavor profiles, the company exhibits the same enthusiasm about the efforts taken this past year in marketing to help reach that broader consumer audience, Fieldly harkens back to.
“In marketing, we’re really excited about our marketing programs that kicked off in 2022,” he explains. “I think one we talked about is the college university opportunity. We just launched our Celsius University where we just graduated our first class of graduates from Celsius University. We’re really excited about that. We have over 25 students in our first class who have been educated on marketing activities, sales strategy and now we’re able to go off to colleges and universities and be CEOs of their campuses and build teams.”
Another program that has expanded for the brand is its Live Fit Tour plus the debut of its Essential Vibes Tour. “Our Live Fit Tour is going coast-to-coast really partnering with health and wellness and getting everyone to live healthy active lifestyles,” he says. “We also launched our Essential Vibes tour, which is also going coast-to-coast and bringing excited and healthy energy and essential energy to a lot of concerts and some festivals around the country today and in the future. We’re really excited about a lot of the partnerships that we’ve had giving back to the community from beach cleanups and also a variety of other partnerships in terms of charity programs and events from coast-to-coast.”
As the CELSIUS brand remains dedicated to the needs of consumers and retail partners, it looks like there will be more opportunities to engage with the lifestyle fitness beverage.
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