Koia cracks the mainstream code with ambitions to be the next $400m+ refrigerated beverage brand
Over the past four years, Koia has grown 800% in sales and distribution (now available in 16,000 stores) achieving record sales in Q2 2021 and exceeding a $40m run rate.
"This year has been incredibly exciting. We will double the business by the end of 2021," Hunter told FoodNavigator-USA.
The company, whose guiding mission is to provide consumers with "truly delicious, healthy, convenient" ready-to-drink plant-based beverages, has worked out its sweet spot of offerings, narrowing it down to its core plant-based protein line, keto line (launched in January 2019), and its low-sugar smoothie line, which in less than a year has become the company's rising star in terms of overall performance.
"Our smoothie line is the fastest growing offering to date in velocity, sales, and revenue numbers, and distribution," said Hunter.
Available in six varieties, Koia smoothies are challenging the legacy brands (e.g. Naked and Bolthouse Farms) which have long dominated the refrigerated smoothie set. Koia smoothies offer a low-sugar profile (9g of sugar, sweetened with stevia and monk fruit), with a small amount of added pea protein and fiber from chicory root fiber.
"If you look at the legacy players in the smoothie space, they’ve been around for a long time, and they're $400m+ in revenue. But some of their SKUs have 55g of sugar per bottle, and in this world where sugar is clearly identified as the enemy, I think that’s a real headwind for them," said Hunter, although he acknowledged that Naked and Bolthouse have both launched lower-sugar products in recent years.
Winning beyond the natural channel
Hunter sees Koia and the mainstream growth its smoothie line continues to unlock in the mass channel as its path to becoming "the next $400m+ brand."
"Some brands in the natural space shy away from Walmart and 7-Eleven, those were easy 'yes’s' for us because our mission is for everyone to have access to delicious, nutritious, plant-based options" said Hunter.
"And you can't reach everyone without Walmart and 7-Eleven," he said. Koia is available nationwide at Walmart and will continue to expand nationally at other key retailers including 7-Eleven.
An investment partnership with NBA All-Star Chris Paul announced last week will help the brand enter a new market of traditionally
under-served communities that lack access to healthy, low-sugar food and beverage options. As part of the partnership, Paul and Koia will introduce a Koia vending machine program on HBCU (Historically Black Colleges and Universities) campuses beginning with Winston-Salem University in North Carolina, with a broader roll-out to more HBCU campuses in 2022.
"The point is we’re bringing a plant-based, low-sugar option to a traditionally underserved community where it didn't really exist before," said Hunter, who noted that for Winston-Salem University, the brand will stock its smoothies in beverage refrigerators at on-campus Barnes & Noble bookstores and set up fully-branded Koia vending machines around campus.
Paul has also made a commitment to purchasing 50,000 bottles of Koia Straw-nana Dream Smoothie, the best-selling flavor of Koia’s smoothie line, to make available on food and home essentials delivery app GoPuff.
'We have a much more complete vision of who we are'
Hunter noted that it took a bit of brand soul-searching, including discontinuing two of its product lines launched during the pandemic (Koia Thrive and Koia Coffee) to figure out which categories Koia could be successful in and capture market share.
"We launched our elevated coffee line with added adaptogens in January 2020, we launched our thrive line which had adaptogens and an oatmilk base in July of that year, and then we launched our smoothie line in October 2020. In retrospect, it was a little bit too much too fast, so we paired that back," said Hunter.
"We decided as a company, we would focus on a real clear picture of who we are and what we are which is delicious, nutritious, plant-based options. What that meant is we got rid of these functional ingredient lines, because it just didn’t resonate with our customers. So we are focusing on our protein, smoothie, and keto lines," he said.