The Vita Coco Company's restructured operational strategy offers 'huge advantage to reach so many more people,' says co-founder

By Deniz Ataman

- Last updated on GMT

Source: Getty/Kristina Ratobilska
Source: Getty/Kristina Ratobilska

Related tags Vita coco Marketing Sales growth

After overcoming a period of declining sales and discontinuation from retailers like Walmart and Walgreens, The Vita Coco co-founder and executive chairman Mike Kirban discussed the company’s operational strategy including brand exposure, reaching consumers through different channels and introducing new product lines during BevNet Live in New York City.

The Vita Coco consumer base, Kirban explained, are people “who are disciplined balancers. They’ll be really healthy and eat really healthy, but then they’ll have a couple of cocktails.”

This specific insight sparked Vita Coco’s partnership with Diageo, launching the Vita Coco spiked with Captain Morgan as a way to expose the brand beyond its presence in grocery stores and corner shops and reaching consumers through various engagement points, in this case at liquor stores, bars and restaurants.

We thought about bringing a product to market for a long time because it mixes so well [in cocktails]. I didn’t want to create a new business. It’s a completely different route to market…a completely different consumer communication. So what we did is partner with who we thought was the best the best at it which was Diageo​,” Kirban explained.

The partnership was a loyalty agreement where Vita Coco sells the water and Diageo produces the pack and distributes it to market.

“They’re now putting our brand throughout that whole entire channel, which is great,​” he added.

Kirban credits the brand’s revitalization to its diverse consumer demographic and shifting marketing strategies from celebrity endorsements to social media platforms, namely Tikoik and YouTube.

More than half of our consumers are non-white, with more Hispanics, Asians and Black consumers​,” he noted, underscoring the spending power of a booming multiracial population​. Coconut water’s cultural significance in diverse communities strengthens the brand’s presence beyond traditional grocery stores, and into localized corner stores serving Hispanic, Asian and Black neighborhoods.

The consumer has changed, and the brand has become younger than it ever was before​,” Kirban added, citing the influential spending power of Millennial and Gen Z shoppers and the brand’s presence on social media to reach those consumers.

“We never really built the business to flip it”

By parterning with Diageo and repositioning marketing efforts to focus on its core consumers, Kirban explains that Vita Coco’s long-term strategy involves building a diversified healthy beverage platform through a combination of new brands and mergers and acquisitions, rather than starting a new company to fit into different markets.

He cited The Coca-Cola Co.’s purchase of Zico coconut water in 2013 (since sold back to the original founder in 2021) as wake up call to rebuild the brand’s core sales and marketing strategy. “We never really built the business to flip it​,” he added.

At the time we were getting discontinued from all these retailers and we put a [simple] plan together. Let’s get back into growth. Let’s get 2% ROI growth and let’s try to grow the business in total by 7-8%.…We needed to think about how we sold to retailers. We need to get better at fact-based selling and building the story and showing retailers what this category can become​.”

Kirban added that the company is now focused on strengthening its national accounts team and creating a large, consolidated beverage platform similar to companies like Diageo and Constellation Brands. He also cites the brand’s revised distribution operations to transition away from direct-to-store delivery model and adapt to different channels and retail strategies.

I think we could do the same so it’s focusing on our core, making Vita Coco to coconut as Ocean Spray is to cranberry…and through a combination of…M&A, [and] creating this diversified healthy beverage platform​,” he concluded.

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