Tio Gazpacho gears up for significant expansion in 2017
The new line - which won't be organic - will still use high quality ingredients and high pressure processing, but will come in a 10oz (rather than a 12oz) bottle, and use more affordable core ingredients in order to achieve a lower price point (the 12oz range retails at around $7.99), said CEO and founder Austin Allan, who said the strategy had proved successful at Suja and other brands debuting in the natural channel.
“We really want our products to be accessible and affordable, without compromising on quality," he told FoodNavigator-USA.
On the distribution front, 2017 is going to be a big year for us
Tio Gazpacho - which launched in Miami, FL, in September 2014 in juice bars and independent retailers – has since picked up business in the North East with larger retailers such as Kings Food Markets, Fresh Direct and Whole Foods, but is looking to expand into new channels and geographies in 2017, he added.
“Working with General Mills has been great because they have people there that have seen it all and done it all so they have been able to help me on everything from flavor development, costing, and sourcing, to marketing and distribution.
“On the distribution front, 2017 is going to be a big year for us. We're ready for prime time now. We’re expanding into other regions outside the New York tri-state area; we’ve just partnered with Amazon Fresh and Amazon.com and we’re looking at foodservice and hospitality as well as conventional grocery stores."
Tio Gazpacho drinkable soups come in four flavors: Clásico (vine-ripened tomato, green pepper, and cucumber); Gazpacho Verde (kale, spinach, avocado, and mint); Gazpacho de Sol (yellow tomato, yellow pepper, and carrot); and Rosado (organic watermelon with a hint of spice).
The partnership with José Andrés
The partnership with José Andrés – who contacted Allan shortly after news broke that General Mills’ 301 INC arm was the lead investor in a $1.25m funding round into Tio Gazpacho – could also help the brand move into the foodservice channel, and enable Allan to tap into Andrés’ sourcing network of produce suppliers, he said.
"He's a chef I've always admired, and when I lived in DC his restaurants were my favorite restaurants, so when he reached out and said he'd like to chat I was so excited. There are so many things we could do together from co-branded products to sourcing.
"He's got a line of his own branded Spanish-themed gourmet products with wide distribution, so they [Andrés' Think Food Group] could help us with some introductions, but they are also very big in the foodservice and hospitality world and they are helping us set up meetings with foodservice distributors and brokers so I see a lot of opportunities there."
When it comes to merchandising, Tio Gazpacho – which can serve as a hearty mid-morning or afternoon snack/beverage or a meal replacement, especially at lunchtime – can work in the produce section, the chilled grab & go beverage set, or by chilled soups [that require heating] and other fresh prepared items, or in some emerging fresh snacking sets (click HERE and HERE), he said.
“Sprouts for example is putting together drinkable sops, refrigerated soups, hummus, fresh snack bars, kimchi, refrigerated meals, some very interesting products all in one set. We’re not in Sprouts yet but that’s the kind of opportunity we’re going after. Conventional retailers are also looking at developing these kind of sets.”
Tio Gazpacho uses high pressure processing (HPP), whereby foods or beverages are put into a high-pressure chamber that is flooded with cold water and pressurized (hence the term ‘cold-pressured’) in order to kill pathogens without heat. This enables the brand to produce products that tastes exactly like fresh gazpacho you’d make at home, with no preservatives or added flavors, and a shelf-life long enough to secure national distribution.
Being first can be a double-edged sword
He added: “Being first in a category is good but it's also an uphill battle because I still spend a lot of my time explaining to consumers and to retailers what soup in a bottle is and where to put it, so I am actually glad that new players [such as ZUPA NOMA from Sonoma Brands] have entered the market, because it raises awareness.
"But as they started on the west coast and we started on the east coast, in many cases we are still on our own in this category.”
However, data is giving retailers confidence that this is a winning concept, he said. "In some of the best performing stores we're doing 60+ units a week with three skus and that's really with no marketing because we haven't had the money for it."