Speaking to assembled kombucha brands, equipment makers, and ingredients suppliers in Long Beach at the event - organized by Kombucha Brewers International (KBI) - SPINS director of sales Bobbi Leahy said sales grew in double digits in the conventional (+28%) and convenience (+55.3%) channels, and in single digits in the natural (+4.6%) and specialty gourmet (+6.5%) channels over the same period.
While kombucha debuted in the natural channel, the conventional (MULO) channel now accounts for 70% of sales.
Velocities were down -10.1% in convenience, -9.8% in MULO, -6.9% in specialty gourmet, and -14.1% in the natural channel, she said.
"Distribution is increasing, but velocity is in decline. There’s going to be a reckoning. All of these retailers are taking all these kombuchas on, but they will be evaluating you and there will be some slashing going on. They’ll ask do we have the right brands, the right flavors, so I applaud you all on the growth, but I would be ready with some materials to go in and defend your space. What goes up sometimes goes down.
“Retailers will expect products to turn at a certain rate, and if you’ve got maybe a unique flavor that only appeals to a small amount [of people] and you’ve got a conventional retailer that only has a small amount of customers that are looking for kombucha, that small and that low could be a kind of perfect storm.”
Top four brands account for 85% of dollar sales of kombucha in the conventional channel
Within the conventional (MULO) channel, the top four brands (GT's, KeVita, Health Ade, and Humm Kombucha) accounted for 85% of dollar sales; while the top four in the natural channel (GT's, KeVita, Health Ade, and Brew Dr) accounted for 77% of sales, leaving a long tail of brands accounting for 1% of the market or less.
While GT’s and KeVita were performing well in the conventional channel with sales in measured channels up 17% and up 23% respectively, sales were flatter in the natural channel with sales up 0% and down -4% for GT’s and KeVita respectively. Health Ade Kombucha meanwhile, witnessed explosive growth over the period, with sales up +53% in the natural channel and up +148% in the conventional channel, said Leahy.
"Health Ade has been an incredible brand in all channels.”
Coconut water dollar sales down 12%
Within the natural beverage set, the fastest growing category in the 52 weeks to February 24 was shelf-stable performance beverages (+87%), followed by refrigerated kombucha and other fermented beverages (+21%), shelf-stable sparkling flavored beverages (+21%), shelf-stable non-carbonated water (+20%), shelf-stable enhanced water (+14%), refrigerated RTD tea and coffee (+11), shelf-stable RTD tea and coffee (+10%), and shelf-stable juices and juice drinks (+1%), said Leahy.
Sales of shelf-stable soda and carbonated beverages were down -1%; refrigerated juice, juice drinks and other functional beverages were down -3%; while sales of shelf-stable coconut water were down 12% over the same period.
Kombucha sales remain strongest on the west coast
Sales of kombucha are strongest in the west coast, with the south central region, Great Lakes, and mid-south regions of the country under-indexing, she said.
Ginger and berries are the top two flavor profiles, but "the strongest growth rate is from the ‘fruit, other’ category, which includes things like watermelon guava, and so on,” she said.
*Total retail sales are likely much higher after you include data from retailers such as Costco and Whole Foods that don’t share their sales with SPINS and other data providers, she added. The refrigerated kombucha and fermented beverages category comprises non-alcoholic kombucha (below 0.5% abv), hard kombucha, apple cider vinegar, plus other fermented beverages such as water kefir, Jun, kraut juice, Kvass, and whey fermented soda.
WATCH: Bare Bucha and Stout Tanks unveil radical new approach to controlling alcohol in kombucha
A novel approach to brewing kombucha in stackable rectangular trays could help the industry dramatically speed up the fermentation process and keep alcohol levels consistently below 0.5% abv, solving a major technical challenge for the industry, according to kombucha brand Bare Bucha and craft brewery equipment supplier Stout Tanks. Watch the video