100119_FD_Issue 176

Offers help expanddistribution reachThe Masters of BeveragesLLC has announced the futurelaunch of its flagship energy drinkSpider Energy across thesouthern US.

Spider Energy is a uniqueorange-citrus flavouredenergy drink and is describedby the company as tasting likea lightly carbonated soda witha bite.The drink featuresslightly higher levels ofcaffeine and B vitamins thantraditional energy drinkswhich, along with its uniqueflavour, sets it apart fromother offerings.

Although its target market iscomposed mainly of malesaged 18 to 34, the companyhas found that other 'non-traditional' energy drinkconsumers are switching fromdrinking regular soda toSpider Energy due to its taste.Nonetheless, the company ismarketing the energy drink inthe music, sports and autoracing markets.To furtherpromote Spider Energy inthese markets, the companyhas its own blog,www.getbitstaylit.com, whereit communities its presence ata wide range of events.

Even though Spider Energy has not beenofficially launched, the company has commencedtest-marketing the beverage to gauge consumerreaction and acceptance. So far, Spider Energyhas been selling very well with sales coming

from new and repeat purchases.

As part of its efforts to secure wide distributionin time for the drink's launch, the company isoffering retailers an introductory deal where foreach case bought, the second is free.This iscoupled with a promotion for the end consumerwhere Spider Energy can be bought for onlyUS$0.99 for the first 60 days that the drink isfirst stocked. Founder Pete Algarin stated, "I'd

rather offer the retailer agreat introductory offer andhave them offer a great deal tothe consumer than spend aridiculous amount of moneyon advertising and only hopethat the consumer will pick upthe product.We look at it thisway; if the consumerknowingly gets a greatintroductory offer in theseeconomic times they are morelikely to try our product.Once they taste Spider Energythey will no doubt come backas we are confident we haveprovided them with the besttasting product possible."

Spider Energy is alreadyavailable in select stores inSouthern California andNashville,Tennessee, where itis being test-marketed, andwill be available inconvenience stores in the restof California and Tennessee,Arizona, Nevada, Coloradoand Atlanta, Georgia, from thefirst quarter of 2010.

A sugar free variant willaccompany the existing SpiderEnergy in the near future.

Each 16oz can will retail for US$1.99, or two forUS$3, with retailers having the ability to price inmultiples.

www.spiderenergy.com

enhanced new age nutraceutical energy sports juice dairy

functionaldrinkszenith international newsletter Issue 176 19 January 2010

Page fourConvenientlycleansing drink

Pages six and sevenRelaxation drinks in the spotlight

Page fiveEnergy shot withBrazilian roots

Page fiveReplenish beautywith new drink

This issue at a glance...

energy drinks United States

New daytimedimension for youngconsumersA year on from its launchof a daytime specific energydrink, Coca-Cola Españahas now introduced a brandextension that is consideredto be a first in Europe.

The new Burn Day variant is madewith juice and, as such, is reportedlythe first such energy drink to beavailable in Spain, and indeed in therest of continental Europe.The newBurn is fruits of the forest flavouredand contains 20% fruit juice as well as37.5% less caffeine than the regularBurn Day.According to the company,

this gives the drink a distinct flavour and furthersets it apart from other offerings.

Burn with juice is targeted at a younger audienceas an alternative to traditional energy drinks forconsumption during the day.According to Senior

Brand Manager, Beatriz Osuna, around60% of consumption occasions forenergy drinks are during the day,hence the company's decision tocontinue innovating in this area.

As with the original Burn Day variant,the juice-based Burn is also packagedin a white can to contrast with itsNight counterpart.The new Burn isavailable in 250ml cans that can bepurchased through supermarkets andpetrol stations.

The Burn brand is said to account for20% of the Spanish energy drinksmarket.

www.burn.es

Issue 17619 January 2010

editorial commentWelcome to the 176th issue offunctionaldrinks and the firstone for this year. Amidst one ofthe worst winters experienced inthe northern hemisphere,beverage producers have not letthe harsh weather stall their plansand just two weeks into the year,it seems that activity in the

functional drinks arenais beginning to warmup.

In this issue we look at some ofthe latest drinks, particularly fromthe US, where it seems companiesare in very good spirits and cannotwait to get back on track. Firstly,we cover The Masters ofBeverages' premier launch in theform of an energy drink with a bite(see Page 1).Also entering theenergy drink sector is Açaí Rootswith an energy shot naturally fullof nutrients (see Page 5).

Meanwhile in Spain, Coca-Cola España hasadded a third variant to its successful Burn rangeof energy drinks, with what is viewed as a first forthe country (see Page 2).We also cover the latestdevelopment from another well establishedenergy drink player, this time in France,Karlsbraü France with a small yet potentenergy shot (see Page 4).

Nearby in Switzerland, we cover the launch of anovel drink by retailer Migros that promises notto damage teeth and to even improve dentalhealth (see Page 3).And for those who are on thelookout for the latest skin health products, wesee a range of cosmeceuticals by Thai beverageproducer Sapanan General Food Co. (seePage 5).

Back in the US, we feature a liquid supplementrecently introduced by Vemma NutritionCompany, specifically designed for children'shealth and parents' peace of mind (see Page 3).Finally, we also look at Simplifast's very timelytake on one of the most common new year'sresolutions (see Page 4).

Happy 2010!

Cecilia Martínez-NúñezDeputy Editor

[email protected]

functionaldrinkszenithinternationalnewsletter


energy drinks Spain




Tooth-friendlyfunctionalitySwiss supermarket Migroshas recently introduced aninnovative tooth-friendlybeverage boasting theTooth Friendly label.

The tea-based drink is produced byBischofszell Produits Alimentaire,a subsidiary of the Swiss retailer, andis flavoured with honey and orange aswell as being acid-free, the latterdetermining its tooth-friendlycredentials.To this effect, Good for Mehas been sweetened withisomaltulose, a disaccharide and aknown non-cariogenic sucrosereplacement, which means the drinkcarries no threat of caries or tootherosion.

Acids are typically added to soft drinks toprevent the growth of bacteria and toensure beverages' stability. However,these acids have a knock-on effect onteeth and promote theirdemineralisation and erosion.To getaround this issue, Bischofszell chose aspecific bottling process andcombined this with isomaltulose toensure the drink's stability andeliminate the need for acids.

Good for Me, which retails for 1Swiss franc per 330ml bottle, has beenavailable across all Migrossupermarkets in Switzerland from theend of October 2009. It has beenspeculated that the innovative drinkcould be launched across Europesometime this year.

www.migros.ch

Next big thing forkidsUS-based Vemma NutritionCompany recently introduced aliquid supplement specifically

formulated to addresschildren's nutritionalneeds.

Officially launched on 1September 2009,Vemma Nextis a premium, physician-formulated, liquid dietarysupplement targeted atchildren aged 2-12.

A 2oz serving contains a halfdose of Vemma's clinicallytested nutritional formulacontaining 12 full spectrumvitamins, antioxidants and over65 major trace and ultra traceplant-sourced minerals. Itsantioxidant-rich ingredientsinclude mangosteen and aloevera as well as decaffeinatedgreen tea. In addition,VemmaNext contains vegetarian DHA

omega-3 fatty acids, known for their brain andeye health benefits, quercetin for addedantioxidant power, as well as prebiotics to helpsupport digestive health.

Two clinical studies have found the Vemmaformula to be highly bioavailable, demonstratingan increase in the presence of vitamins andantioxidants in the blood after consumption.Independent laboratory tests have alsoconfirmed Vemma's high ORAC (Oxygen RadicalAbsorbance Capacity) value of 3315, significantlyhigher than that of most competing products.

The orange-flavoured drink is preservative free,gluten free and contains no artificial colours,flavours or sugars.

The company is very active in its socialresponsibility efforts, and for each month'ssupply of Vemma Next purchased,Vemmadonates the equivalent supply to a child in needin the country of purchase. In the September toNovember 2009 period,Vemma also donated aportion of the proceeds of Vemma Next to not-for-profit charity Children's Miracle Network.

A 'fridge brick' pack of 30 2oz bottles retails forUS$50 and is available for purchase online viathe company's website.

www.vemma.com

wellness beverages Switzerland

wellness beverages United States




Masterful cleansingwith lemonfunctionaldrinks spoke to DiannaToomey, Founder and CEO ofSimplifast, who told us about thelatest developments of thecompany's eponymous detox drink.

Simplifast was founded in 2007 with the aim todevelop a RTD offering based on the MasterCleanse, or Lemonade Diet, for all those wishingto follow a fasting diet or simply wanting tocleanse their body from toxins and otherimpurities.

The Master Cleanse diet was created over 70years ago by a naturopath, Stanley Burroughs,who claimed that a mixture of water, lemon juiceand sugar helps cleanse the kidneys and digestivesystem, purify glands and eliminate waste in thejoints and muscles.Although not originallyintended as a weight-loss tool, the fast has alsobecome popular for those looking to lose weightquickly.

Simplifast officially introduced its eponymousdrink in October 2008 through select specialtyretail stores and online retailers.Toomeydescribes Simplifast as "a unique, first-of-its-kind,

RTD lemon detox beverage" targeted at healthconscious consumers who routinely go oncleansing fasts or those seeking to lose weight.Furthermore, according to Toomey, "Our corecustomers crave Simplifast on a daily basis, use itas an energy drink and to skip a meal to maintaintheir optimal weight."

Each bottle of Simplifast contains the juice ofthree lemons, 11g of fibre (or 44% of the dailyvalue), 100% of the DV of vitamins B6 and C, and50% DV of vitamins A and E. Simplifast issweetened with pure organic maple syrup (grade-B) and stevia, which makes Simplifast a low GIbeverage and safe for those consumers thatsuffer hypoglycaemia and even some forms ofdiabetes.

In order to promote the drinks,Toomey saidpublic relations and in-store promotionalactivities are the focus as these are considered tobe the best ways to sell the drinks and createcustomer loyalty.Toomey added, "Educating theconsumer that there is now a proprietaryformula that is ready to drink, based on thispopular concept, is the key to success. Onceconsumers sample the great taste and realise thehealth benefits and the time and money Simplifastsaves them, it becomes a no-brainer."

When asked about possible new variants,Toomeysaid, "We do have active market research andR&D efforts underway to expand the productline and introduce complementary beverages and

products. Our product extensions willrevolve around our current health andwellness mission."

In the meantime, Simplifast hasidentified a few select internationalmarkets and considers the Middle Eastto be the prime area for initialinternational distribution in 2010.

Simplifast is packaged in 16oz bottlesand is available in Lemon, Strawberryand Blueberry flavours. Each bottlesells for between US$4.29 andUS$4.99, which Toomey justifies bythe time and money saved comparedto home-made alternatives.

Simplifast can be bought at a widerange of stores includingsupermarkets, supplement shops andwellness centres, which the companyhopes will reach the thousands by2011, as well as online throughAmazon amongst others.

www.simplifast.com

enriched beverages United States


Replacing nutrientssapped by city living

Sapanan GeneralFood Co.,Thai-based producer andexporter of softdrinks, has recently

expanded itsportfolio witha newcosmeceuticalrange.

The new drinks,which fall under thenewly createdSappé Beauti brand,are designed to helpcounteract

premature ageing

provoked by the impact of modern city life,involving stress, pollution and exposure to thesun. In addition, each of the four Beauti variantsfeatures a specific key ingredient to targetdifferent needs.

Beauti Collagen delivers 500mg of theingredient, helping replenish the body's stores asthey diminish with ageing. Meanwhile, BeautiCoQ10 contains 15mg of the enzyme inaddition to vitamin E to increase the drink'santioxidant effect. L-carnitine and 4,000mg offibre are the main ingredients in Beauti Fiber,which helps regulate digestion, as well asreducing hunger and the build up of fat.The finalvariant is Beauti Chlorophyll, whose namesakeingredient reportedly helps strengthen theimmune system, detoxify the body, clean theintestines and keep skin young and healthy.

All variants are available in 365ml PET bottles aswell as 180ml cartons.The Sappé Beauti rangecan be bought across select department storesin the country.

www.sapanan.com



Rooting for successAçaí product specialist AçaiRoots has expanded into theenergy shot market with the

launch of nex4 PureAçaí Energy.

The natural energyformula is packed withantioxidants and vitaminsderived from açaí, acerola,guarana and green tea,and is designed to giveconsumers a healthysustained energy boost,without the sudden crashassociated with someenergy drinks.

The benefits of the açaíberry have been welldocumented, and arebased on the fruit as arich source ofantioxidants, essentialfatty acids, dietaryfibres, protein, calcium,

vitamins A, B6 and E.

According to Igor de Freitas, CEO and co-founder of Açai Roots, "The idea behind theshot was to develop an innovative açaí productfor our consumers. Something completely new,with which they would be extremely pleased".

Nex4 is ready to drink but the company alsosuggests that it can be mixed with any liquid tomake nutritious juices, shakes, smoothies orcocktails.

The shot is aimed at health-consciousconsumers aged between 16 and 40.To reach itstarget market Açai Roots is undertaking severalmarketing initiatives, including promotion on itsFaceBook social network page and sampling atevents such as jiu-jitsu, capoeira and volleyballtournaments.

A 2oz bottle retails for US$2.99, with a 32ozformat also available. Nex4 shots can bepurchased online from the company's websiteand through select retail locations across theUS, including Whole Foods, Max Muscle, 24hFitness, Publix and Froots.

www.acairoots.com

cosmeceuticals Thailand

energy drinks United States

Relaxation drinks infocusWhilst the concept is not entirelynovel, relaxation drinks, alsoknown as anti-energy or anti-stress beverages, have only reallystarted to command attentionover the past year with a wave ofnew offerings appearing in the US.

Heralded as one of next big things in the USjust last year, such products have already beenpresent in many markets as part of ranges or asstandalone niche drinks for some time.This isparticularly the case in pioneering Japan, whicharguably spearheaded this emerging trend andwhere the majority of such stress-bustingofferings feature GABA (gamma aminobutyricacid) - a brain chemical that promotesrelaxation and sleep.

Some of the most commonly used ingredients inthose products appearing in the more Westernworld range from well-known herbs such aschamomile, valerian root, passion flower and St

John's Wort tothe Polynesianroot kava andeven toprescription-type alternativessuch as GABA,L-theanine orthe hormonemelatonin.

Irrespective oftheircomposition,the arrival ofthe new wave ofrelaxationdrinks hasreceived varyingreactions. Manyexpected these,along withothernutraceuticals,to suffer due tothe economiccrisis asconsumerstightened theirbelts and cut

down on discretionary spending. However, theoverall nutraceuticals category has thus farproven its resilience thanks to its value-addednature, highlighting that consumers are not onlyinfluenced by price but also by health benefits.

Similarly, as relaxation drinks started to increasetheir presence in the market, their counterpart,energy drinks, started to witness a slowdown ingrowth as the market becomes more saturated.However, energy shots have provided thecategory with fresh impetus and are provingimmensely popular not only in the US but alsoin West Europe. On the strength of this success,a considerable number of new anti-energyentrants are packaged in shot format, entirelybypassing the path taken by energy drinks - firstsupersizing and then downsizing.

Also against a backdrop of lower energy drinkvolumes, some have suggested relaxation drinksare set to become a serious contender toenergy drinks as consumers get tired of leadinghectic lifestyles and instead opt to sit back andrelax.And although it is true that certainofferings, such as Jones Soda's GABA drink,claim to relax and aid concentration, for themost part these have a different appeal andbring new consumption occasions, and can alsobe viewed as a natural compliment to energyshots.According to recent industry comment,"Energy drinks and relaxation drinks are liketeas; you have caffeinated teas for when youneed to be alert and you also have caffeine-freeteas for when you don't need to be alert."

Relaxation drinks seem to be set to expandfrom their current niche in the US, howeverwhether their appeal will catch on in Europeand what, if any, regulatory issues such drinksmay face, particularly given that certain




nutraceuticals United States

EuropeAustria: Coca-Cola Hellenic Austria hasintroduced an apple-redcurrant variant of itsRömerquelle Emotion near water range.Theproduct is to be available in 500ml and 1 litrePET bottles, priced at approximately €0.85 and€1.19 respectively.

France: Red Bull France has been promotingits newly launched energy shot, highlighting itsmany attributes, including delivering the sameamount of caffeine as a 250ml can of Red Bull,easy placement in stores due to no refrigerationrequirements, and the wealth of consumptionoccasions it creates for consumers.

Gelatine and collagen specialist Rousselot haspublished the results of its latest research into itsPeptan ingredient, which demonstrate that it canhelp maintain bone health and prevent the onsetof osteoporosis.

Netherlands: Lipid Nutrition has launched aready to use emulsion featuring its Marinolomega-3 ingredient that provides EPA and DHA.The new emulsion is innovative in that it not onlyprovides health benefits for consumers, but alsohelps manufacturers since mixing the emulsionwith dairy-based beverages boosts its activeingredients' stability and protects them fromoxidation.

Spain: Novalicor Auria has introduced a three-strong range of energising liqueurs, each of whichfeatures either ginseng, coffee or guarana.The

liqueurs, branded Entropía, are packaged in 700mlglass bottles.

UK: Voltz International has announced plansto launch its eponymous energy shot in Australia,shortly after appointing a local distributor. CEORob Arnold commented, "The energy drinkmarket is established in Australia but the energyshot market is a relatively new concept.Weanticipate the introduction of such a new andexciting product like Voltz will prove particularlypopular and we are therefore delighted to haveappointed a sole distributor for Voltz inAustralia."

To mark the launch of its eponymous shots insupermarket Waitrose, Focus 5 Hour held aBatak challenge at a London branch to highlightthe shot's ability to increase concentration andresponse times.According to the company, salesof Focus 5 Hour rose 630% after the activity.

Distributor Tree of Life has launched Yumberry-branded yang-mei juice across the UK.Yumberryis a 100% organic juice sold through most healthfood shops and a 500ml bottle retails forapproximately £2.50.Yang-mei juice has beenreported to be high in anthocyanins.

UK food wholesaler Booker Group has revealedthat its Euro Shopper Energy Drink has thefastest rate of sale of any impulse drink.Thebrand reportedly enjoys sales of 36.4 cans perweek at a price of just £0.35. Steve Fox, SalesDirector - Retail, commented, "This research




substances such as melatonin are not approvedfor consumption without prescription.

The number of relaxation drinks available in the

US, however, is predicted to grow throughout2010. Some of the most notable relaxationdrinks launched recently are listed below:

functionaldrinks in brief

nutraceuticals United States

Company Product name USP Packaging

RelaxCo Blue Cow First of its kind in theUS

10oz bottle

Mary Jane's Soda Inc Mary Jane’s RelaxingSoda

Only cola with such afunctional positioning

12oz bottle

Jones Soda Jones GABA First GABA drink in theUS

12oz slim can

Vitila Brands Tranquila Day and Night variants 2oz shot

Peaceful Remedies RelaxZen Zero calories 2.5oz shot


proves that the drink offers a significant cashprofit contribution for retailers due to thevolume of sales. However, equally important isthat the product tastes great, so shoppers loveit."

UK newspaper The Sunday Times has rankedBoost Drinks in 44th position in the 2009Sunday Times Virgin Fast Track 100 of Britain's topperforming companies. Boost Drinks' sales havegrown 88% year on year, from £1.5 million in2005 to £9.7 million in 2008, exceeding theaverage growth rate within the energy drinkmarket.

Gatorade UK has launched a promotionalcampaign intended to reward consumers for theirsporting efforts. Consumers collect codes frombottles of Gatorade that can be redeemed againstequipment, music downloads, sporting holidaysand others. In addition, a weekly prize draw willrun for all registered participants.

North AmericaAccording to Consumer Edge Research (CER),North America now accounts for 41% of globalvolume of energy drinks, despite the categoryhaving emerged from Asia and Europe. CERestimates that the global energy drink market isworth US$20.2 billion and sized at around 865million litres.

US: DNA Beverage Corporation, producerof DNA Energy Drink, has signed an agreementwith Vital Pharmaceuticals for the distribution ofits VPX and Redline branded weight loss drinks.The agreement will see the drinks distributedthroughout the southeast region of the country.

Fruit 66, producer of an eponymous low-calorieand nutritious juice drink, has announced that ithas added vitamin D to its sparkling drinks after arecent study revealed that one in five children donot get enough vitamin D.The reformulatedbeverages are already available for purchase in

schools and natural food stores.Beverage Plus has received a letter of intentfrom a Hong Kong-based company for thedistribution of its MC2 Energy Drink acrossChina.The distributor also intends to make aUS$150,000 investment in Beverage Plus.

Hansen Natural Corporation hasintroduced Monster Energy DUB Edition in BallCorporation's resealable jumbo cap can.

UpLift Nutrition has signed a distributionagreement with Mr Checkout Distributors forthe sale of its All Day Energy Spray across17,000 stores in the US.

Skinny Nutritional Corporation has appointedfive new distributors in California: Bay AreaDistributing Company, Energy SourceDistribution, GBL Distributing Company, MorrisBeverage Distributors and Saccani DistributingCompany.

Sales of Pepsi-QTG owned Propel were down32.4% in the year to August 2009 compared to2008.The downward trend has been attributedto negative press about the environmentalaspects of bottled water as well as theeconomy.

WorldAccording to UK researchers, drinking a cup ofBrazilian mint tea can alleviate pain to a similarmeasure as commercially available analgesics.The plant has been traditionally used in Brazilas a remedy for headaches, stomach pain, flu,fever and other ailments.

Mexico: According to Nielsen data, sales ofenergy drinks rose 24% during August andSeptember 2009, compared to the same periodin 2008.The sector was second to RTD tea,which experienced a rise in sales during theperiod.

Editor: Jenny FouldsDeputy Editor: Cecilia Martinez-NunezContributors: Charmaine HolmesMarket Intelligence Director: Gary Roethenbaughfunctionaldrinks is issued 25 times a year and is onlyavailable by subscription: electronic PDF format only £495;hard copy and PDF £595**VAT chargeable on electronic format to UK companies and EC companies not

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100119_FD_Issue 176

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