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Hain Celestial scores industry first with refrigerated energy shot

By Elaine Watson , 25-Aug-2011
Last updated on 25-Aug-2011 at 19:32 GMT

Celestial Seasonings' kombucha ready-to-drink teas have been very successful
Celestial Seasonings' kombucha ready-to-drink teas have been very successful

Hain Celestial will break new ground in the burgeoning shots market this fall with the launch of the first refrigerated energy shot.

The new 2-ounce (59ml) Celestial Seasonings Kombucha Energy Shot will hit shelves in natural retailers in October, Blake Waltrip, vice president and chief marketing officer of Celestial Seasonings, told FoodNavigator-USA.

Our all-natural shots are the first refrigerated energy shots because they are made with live, raw kombucha. This represents a major point of differentiation from shelf-stable shots as do our all-natural ingredients, which do not include artificial sweeteners and preservatives.”

He added: “The energy shot market is exploding. Consumer research has shown that many consumers are looking for a natural energy alternative, and are also very interested in an energy shot with the benefits of kombucha.”

The shots, which will promise an “all-natural burst of liquid energy to help consumers stay vibrant and focused”, include raw kombucha and a proprietary energy blend, he said.

“Our target consumers are energy shot users, natural beverage and kombucha users, as well as current Celestial Seasonings users.”

Speaking to analysts on a conference call about Hain Celestial’s fourth quarter results on Tuesday, executive vice president John Carroll said the shot was the “first to combine two hot trends in the ready-to-drink category, kombucha and energy, in an all-natural refrigerated beverage”.

He added: “They are getting great distribution pick-up already.”

Kombucha taste challenge

Hain Celestial had already tested the waters with kombucha via a new range of 16 fl oz fermented ready-to-drink kombucha teas under its Celestial Seasonings brand launched last March, said Waltrip.

“Our current Kombucha products have been very successful, and we’re continuing to roll them out in more regions as we expand capacity.”

The drinks taste better than other kombucha products on the market, claims the firm. “Each features a distinctive blend of fruits, herbs and botanicals and a light effervescence, resulting in exceptional flavor that shatters Kombucha's perceived taste barrier.”

Kombucha can be traced back more than 2,000 years to Russia, the Himalayas and the Far East, according to Celestial Seasonings, which adds a live culture called a SCOBY (symbiotic colony of bacteria and yeast) to a combination of organic brewed tea and sugar.

After fermentation, the kombucha contains naturally-occurring probiotic organisms and acids that might promote digestive health and “enhance and maintain vitality”, it claims.

Hartman: Refrigerated RTD category a good place to launch novel products

In a recent webinar on beverage trends, Hartman Group’s director of culinary insights Melissa Abbott said consumers were particularly adventurous – although equally fickle - in the single serve, ready-to-drink chilled category, making it a good place to launch novel products.

However, kombucha had attracted some unwelcome publicity last summer when several retailers temporarily pulled products from shelves citing concerns about alcohol levels (some batches had continued to ferment after they had been bottled), she said.

“Just prior to last year’s kombucha fiasco, there were numerous new entries into the marketplace hoping to ride on the success of GT’s, the most widely recognized kombucha brand. [But] the new formulations are not the same and consumers do not believe they offer the same perceived benefits.”

Yogurt smoothie pouches and K-cups ‘breakout hits’ for 2012

While some of the biggest names in grocery have suffered volume declines in the US as consumers have cut back and prices have risen to offset soaring commodity costs, Hain posted a 92% surge in profits and a 31% rise in Q4 revenues.

New products had added more than $30m in sales to the US alone in 2011, said Carroll: “We expect to do that again in 2012 or beat it… We are very bullish about our business for 2012.”

Two recent launches - Earth’s Best Sesame Street organic fruit yogurt smoothies in pouches and Celestial Seasonings sleepy time K-cups – were “already showing signs that they could be breakout hits”, he added.

Full year sales up 23% to $1.13bn

Chief executive Irwin Simon said he was also looking at acquisitions to drive growth: “There are four or five acquisitions we’re looking at – although there is no guarantee we’ll get them.

“There are some big opportunities internationally… I’d like to be doing 50% of our business in the US and 50% outside, and at the moment, it’s more like 75:25.”

The firm, which has a leading position in the natural and organic products market with brands such as Celestial Seasonings, Garden of Eatin, Rice Dream, Soy Dream and Linda McCartney, said sales were up 23% to $1.13bn in the year to June 30. Net income was up 92% to $55m.

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