Blog Entries by Andrew Kaplan


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Category: General Blogs

Last month, I discussed in this space my prediction that “energy drinks will find a way.” What I meant is that consumers have taken to this relatively new beverage category so quickly, and with such passion, that more regulation or not, it will find a way. This could mean new formulations or maybe a break-away segment of more natural energy drinks (actually, we are already seeing the latter coming on strong with several natural or organic brands now on the market).

What I didn’t take into account in that column, however, is how the success of the energy drink market is now beginning to make an impact on other non-’energy’ beverage categories. Last month’s column borrowed a phrase from the film “Jurassic Park,” so here’s another sci-fi reference: The energy drink category has become so successful in such a short time that it is like one of those black holes out there in space, everything near it is slowly being sucked right in!

Case in point is coffee. It’s obvious the reverberations of the energy drink category are spreading outwards at incredible force when a brand that can trace its roots back to 1932 suddenly slaps the word “Energy” on its label. The brand I’m referring to (as you can see in the photo) is that favorite coffee of New York City grandparents everywhere, Chock full o’ Nuts. (I can hear that heavenly jingle now: ‘A better coffee a millionaire’s money can’t buy!’) It seems a little sad in a nostalgic kind of way to see this venerable brand suddenly try to appear all young and hip. Especially since it wasn’t all that long ago, that it debuted a reduced caffeine version But hey, things were kinder and gentler back then. In this hyper-charged new millennium society, the more supercharged with caffeine the better.

Just consider these stats from the latest survey of U.S. coffee consumption habits by the National Coffee Association: 83 percent of Americans now say they drink coffee, up by 5 percent from just a year ago. Daily consumption, according to the NCA, remained “strong and steady” at 63 percent, while the figure for those who drank it at least once a week was up slightly to 75 percent.

All of this comes at a time when a cloud of potential regulation of caffeinated energy drinks—perhaps caffeine in general?—continues to hang over the industry. Last December, in response to the controversy stemming from a lawsuit against Monster energy drink, the FDA said it would possibly convene a panel of experts to investigate further the effects of various stimulants, especially on “vulnerable segments” of the population. But as of the time I am writing this in mid-April, the FDA tells me that has yet to happen.

Energy Drinks Find a Way

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Category: General Blogs  |  Tags: energy, natural

The headline of my column this month is inspired by a line from the movie “Jurassic Park.” As the main characters are standing in the dinosaur lab, Jeff Goldblum’s scientist argues that “life finds a way.” They may try to control which dinosaurs they bring back to life, but some things have a life of their own. And, as anyone who’s watched the movie knows, these characters will eventually run into a teensy weensy bit of trouble as a result.

Anyway, what does “Jurassic Park” have to do with the beverage business? Replace the word “life” in the quote with any successful beverage category under attack today and there you have the theme of this month’s column.

That line from the movie—which I guess is always sloshing around in the back of my mind along with dozens of other memorable movie quotes—popped to the forefront of my cerebrum the other day as I was thinking about the different forces aligning against beverages. There’s the government, with its attempts to limit sizes of some drinks or impose taxes on them or ban them altogether. And then there are the consumers themselves, who have turned to the courts. One of the most well known cases of this is the lawsuit against Monster energy drink by the family of a young woman who died after allegedly drinking the product. The lawsuit alleges Monster’s formulation was somehow to blame for the young woman’s death.

The “Jurassic Park” quote came to mind when I noticed that despite all of the recent negative publicity about energy drinks, despite all of the controversy, the category is finding a way. Much of the ingenuity and creativity that originally made the category the enormous success that it is today, is now being poured into the emerging category of more natural and/or organic energy drinks. These are drinks touting New Agey—and presumably healthful—ingredients like guarana, yerba mate, açai, green tea, and the like.

Let’s face it, energy drinks are here to stay. The category has been racking up billions of dollars. Consumers just love it. Apparently there was this gap in the market when it came to what consumers needed. They wanted something beyond just coffee to give them a boost of energy and enhanced focus throughout the day and the energy drink category emerged to fill that need. And as of late, the category has either been evolving into, or splitting into, something different.

Time will tell if we end up with a standalone “natural” energy drink category existing side-by-side with the mainstream energy drink brands, or if all the controversy and negative publicity somehow forces the top energy drinks to reformulate in a new direction.

Either way, you can bet that the energy drink business will find a way.

Studying Studies

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Category: General Blogs

I was both amused and a little bit frightened the other day—maybe bemused then?—to read widespread media reports about a study linking moderate alcohol consumption to higher risks of cancer.

My first reaction was, “Egads! And I thought moderate alcohol drinking was supposed to be good for me!” And it is, or so I’ve read in numerous other studies. And therein likes the problem: when one study reaches one conclusion, and another study a contrary one, what are we supposed to believe? 
If, in the example above, having a nice glass of wine or a beer with dinner both guards me from heart disease while at the same time raising my risk of cancer, should I have it? I guess you could say the smart thing would be to make specific choices based on my own situation. If heart disease runs in my family and not cancer, then maybe a drink a day is beneficial. If we have a higher genetic risk of cancer, maybe it isn’t.
That is, of course, if we are going to pay much attention to all of these studies in the first place. If you take some time to learn a little about the methodologies used, it quickly becomes clear that really good scientific studies can be hard to come by. Oftentimes other scientists or experts criticize the results of their peers’ studies based solely on the methodologies used. In fact, if you notice, in most articles reporting the studies the reporter will usually include one or two other experts who disagree with its findings.
But even without that being the case, my question is are we studying ourselves to death with all these studies?  What’s the impact on our health of being told that everything we enjoy is bad for us? Has anybody ever studied that? It’s gotten to the point where you show me something pleasurable in life, anything at all—yes, including a nice glass of wine or a beer—and I can show you a study that says it’s bad for us. What a bummer!
Thankfully, I can also show you a study that says it’s good for us. So, when it comes right down to it, what’s really the point? We’re left pretty much where we started, aren’t we?
I guess I’m being a little simplistic here. Sure, there are some studies that are more respectable than others and should be taken very seriously. For example, we all know today that cigarettes are bad for us. But that was not always considered a fact. Our understanding only changed after study after study confirmed it to be true. 
But there just seem to be many more studies today that are released into the 24-hour, non-stop news cycles that are not as trustworthy—and they have the potential to do a lot of damage. 
The impact of this latest study, which claims to find a link between moderate alcohol consumption and cancer (I have my doubts based on reading about it, but I’m an editor, not a scientist so I’ll hold my tongue), could very well hurt the livelihoods of many hardworking people in the alcohol beverage business the world over. Do the study’s authors ever stop to think about that? I sure hope they are confident with their results before releasing them because this is not a game. Yes, people’s lives will be effected, and sometimes not in the way the study’s authors were thinking. It all leaves me with the burning question: Has anyone ever done a study on the impact of studies?  

Packaging of Tomorrow

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Category: General Blogs  |  Tags: packaging, Disney World, RFID tags

I found it fitting that Disney World, home of Tomorrowland, recently announced one of the more futuristic uses of radio frequency identification technology (perhaps better known by its acronym: RFID). For those of you not familiar with RFID, it’s a technology that uses small tags on items to beam signals back and forth to readers. The result is the ability to easily track products as they pass by the readers, like in the beverage warehouse, for instance.

The interesting Disney twist is that the RFID chip won’t be placed on any of the company’s products, but on people. That’s right, the park’s guests will be given what are called “MagicBands” containing RFID tags that will serve as a guest’s room key, theme park ticket, access to FastPass+ selections, PhotoPass card and optional payment account all rolled into one.

This innovative use of the technology reminded me of all the promises we’ve heard about RFID and other advanced technology over the years. Several years ago, the vision was that RFID tags would get to be so inexpensive that they could be placed on individual items, such as cans of soda. We’re not quite there yet, but as the Disney MagicBands bear out, we might be getting closer.

Just consider the possibilities. Individual packages of soda, beer or other beverages containing the tiny tags could one day be part of an advanced “smart home” system. Every time the consumer finishes drinking a bottle of Coke, for instance, disposing the empty package would trigger a reader that automatically orders them another one as part of their next home delivery from the local supermarket.

The possibilities of such technology are really endless. The only limitations so far have been the cost of the RFID tags, which until now have been too expensive for individual items.

RFID is just one technology that has the potential to revolutionize beverage packaging. Others are already in use, such as QR codes that enable consumers to scan the package label with their smart phones, linking to websites or videos with more information or special promotions.

David Turner, principal and founder, Turner Duckworth Design, recently emailed me his 2013 predictions for beverage packaging. He started by pointing out that beverage packaging really hasn’t changed very much in the past 100 years or so. So are we overdue for a major change? He believes so. “Not to the form of packaging, but to its role,” he said. “Packaging is the one part of a beverage brand’s marketing that’s guaranteed to reach the consumer. With the advent of image recognition technologies, the package can come to life through mobile devices as an interactive hub for information and entertainment.”

Now that sounds just about as innovative as Disney’s MagicBands. The beverage package’s role has remained unchanged for decades. All it needs are these emerging technologies to give it that extra layer of functionality.

So who knows what the future will hold. But if Turner is right, we may be entering a new era where the beverage package takes on even greater importance than it’s had until now. It truly will be the packaging of tomorrow.

Reaching New Heights

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Category: General Blogs  |  Tags: lifestyle brands, branding, energy, Red Bull

While I was researching and writing this month’s cover story on energy drinks, it occurred to me that there are few other consumer products that have been as creative, even ingenious, in their use of marketing.

Energy drinks didn’t get to be where they are today—one of the fastest growing, most vibrant beverage categories—just by fulfilling a need state, though that has certainly been a very important key to their success. After all, many consumers today, in all types of demographic groups, have come to rely on their daily energy drink for that extra bit of mental alertness and energy each day. To many of them, a cup of coffee is sort of their grandfather’s drink.

But a big part of the reason they feel that way is because of the category’s superb marketing. Energy drink companies have created excitement around their products that is unmatched by other beverages, and most other consumer products. Sure, other beverage companies like Coke and Pepsi are known as marketing powerhouses. There are few companies that can compete with them. But some of the smaller energy drink companies have taken marketing to a whole new stratosphere—literally.

For example, you must have been asleep under a rock this past October if you didn’t at least see some mention of the Red Bull Stratos project. Felix Baumgartner, sponsored by Red Bull, broke the world record for the highest and fastest jump in history—an incredible 24 miles. First, he rode in a space capsule attached to a 850,000 cubic meter helium balloon to a record-breaking altitude of 36,576 meters (120,000 feet). On his way down he broke the sound barrier at speeds near 1,110 km/h (If you haven’t seen the footage, it’s available on YouTube.) Red Bull financed the project and its logo was plainly visible for all to see on uniforms and the space capsule itself.

What a marketing coup for Red Bull! The company always has made this type of breathtaking, daredevil marketing a central part of its brand identity and that has been part of its genius—and its success. And now, thanks to Baumgartner’s jump, it is part of history as well.

Yes, even Coke and Pepsi can probably learn a thing or two about marketing from some of the energy drink companies. It’s one beverage category that continues to push new boundaries in CPG marketing.