As soda sales fall, kombucha rises

By Elizabeth Crawford contact

- Last updated on GMT

Related tags: Fermentation, Entrepreneurship

Tumbling soda sales have opened the door to the mainstream market for a variety of functional beverages that were previously relegated to the natural channel, including kombuncha sales of which, according to one entrepreneur, grew 41% to $534 million last year and are expected to reach $4 billion by 2024.

But before it can reach this full potential, the unconventional beverage needs to overcome several substantial hurdles, adds Sean Lovette, the co-founder of Revive Kombucha.

“In the last six to nine months, we have seen a huge uptick in retailer adoption to the category. So the amount of retailers reaching out to us and accepting kombucha in the set has definitely peaked. It is like something in the category switched our role in the mainstream,”​ Lovette told FoodNavigator-USA at the Summer Fancy Food Show last month.

He attributes growing consumer interest in kombucha to their search for beverages with lower sugar and functional benefits, but which are still carbonated and fun to drink.

Likewise, he said, recent validation by major beverage players and investors has also helped raise the beverage’s profile.

“What validates for retailers is when certain strategics make investments in the category. So, having Pepsi make a purchase of KeVita, I think, was one of the big validation points of 2016. And once that happened, the market starts to go, ‘Okay, this is a category that investors and strategics are putting money into, there is growth here, let’s get behind this,’”​ he said.

Getting the retailers and big brands on board with kombucha is only part of the battle though. Entrepreneurs in the segment also need bring mainstream shoppers on board, and to do that, Lovette said, they need to address several hurdles.

The top challenges include the strong vinegary taste of kombucha, which can be off putting to some mainstream shoppers, he said.

“We have answered that in our brew that we have actually moved the vinegar to the back of the profile, and really made the ingredients of our brew the stars of the show. So it’s really about the quality of the ingredients and what you are tasting, versus heavy, heavy vinegar,”​ he added.

Another key challenge is educating consumers about the functional benefits of kombucha, such as the value of fermentation and probiotics in the beverage, he said, adding that the entrance into the category by major players, such as Pepsi, will bring the funding necessary to market these messages.

And finally, he said, the industry must improve its truth in labeling about the ingredients that are used and the amount of sugar that is in the beverage.

Revive Kombucha address these challenges in part by creating and following strong standard operating procedures that allow it to certify its product as nonalcoholic through the expiration date on the bottle while still offering consumers a product that is not pasturized, has no alcohol reduction and is 100% naturally fermented, live, raw and organic.

It also offers a smoother flavor profile that likely will appeal to come consumers than some of the more traditional options, he said. 

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