Nurturing the Next Big Thing

With so much of the beverage industry's growth coming from product categories that barely existed a decade ago, it's no wonder everyone is continuously looking for the next big thing.

Zico Coconut Water
Zico Coconut Water

Beverage Marketing's annual Beverage Forum likes to highlight some of these rising stars. This year, one interesting company in the spotlight was ZICO, a coconut waterbeing pitched as "nature's sports drink" to yoga enthusiasts, endurance athletes, and surfers.

The distribution strategy centers partly on selling to yoga studios and then radiating distribution out to the surrounding area. It's a clever plan and it's gaining its fans. (Gwyneth Paltrow among them.)

Coca-Cola and PepsiCo have gotten adept at snatching up some of these brands after they have successfully tested their concept in the marketplace. (An example is Coke's purchase of Glaceau VitaminWater.)

That's ruffling a few feathers among the independent bottlers, who feel as they are investing a lot to nurture these new entries only to lose the products to their deep-pocketed competition once the drinks gain traction in the market and start making big money.

Entrepreneurs breaking into the beverage business should look for contracts with the independent bottlers to get tougher as these bottlers look to get most out of these deals.

Still, with everyone speculating about how beverage distribution landscape will change if PepsiCo is successful in its plans to buy its two largest bottlers Pepsi Bottling Group andPepsiAmericas, it is important to remember the vital role the independent bottler plays in fostering what often is the future growth of the industry.

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