The InterBev 2010 Beverage Innovation Awards - OnTrak Software

As I sat at my table at InterBev 2010 Beverage Information Awards dinner in Orlando, hosted by the American Beverage Association, International Bottled Water Association and FoodBev Media, I hoped our company would come away a winner in either the Best New Bottling, Manufacturing or Distribution Innovation or Best Environmental Sustainability Initiative category.

Unfortunately — for us — Trustwater won the Innovation category and Coca-Cola Enterprises won in the category Environmental Sustainability. Nevertheless, I was proud that OnTrak was nominated and thought, “There’s always next time.”

I did, however, have the pleasure to be seated next to Ben Weiss, founder and CEO of Bai Brands, who was the evening’s only two-category winner (Best New Functional Drink and Best New Beverage Ingredient).  As you might imagine, during dinner, the conversation, naturally, centered on Ben’s company and products.

I came to find that Bai Brands, a relatively young company, had recently signed distribution deals with three of the Northeast's leading multi-brand distributors of wine, beer and premium soft beverages.

When Weiss found out that OnTrak’s customers are primarily alcohol beverage distributors who we help manage, control and measure the effectiveness of their Marketing at-Retail initiatives (POS), he began firing questions at me asking how we help distributors get the most out of their point-of-sale promotional campaigns. Specifically, he was interested in how we measure the effectiveness of POS.  In other words, Bai Brands CEO wanted to know, “How could OnTrak’s software products help us determine the ROI of our Marketing at-Retail spending?”

We discussed how OnTrak keeps track of POS spending and sales by customer and product; and, how we comapre revenue and case sales by customer or product to POS spend by date. We talked about the value of this data correlation for predicting and forecasting what POS expenses were the most valuable in generating an acceptable ROI for POS campaigns.

As if the dinner conversation and subsequent awards ceremonies were not enough excitement for one evening, Beverage Industry Magazine also provided attendees with a magazine supplement for their September issue focusing on Innovation and New Product Development. Glancing through the supplement, I came across a New Product Introductions by Category list. 

I was surprised to see that from August 2008 through July 2010, 3,034 new beverages were introduced. But, what really got my attention was the August 2009 — July 2010 growth was 1,670, up 22% over last year. Alcohol beverages made up over 32% of the total new products with 543 introductions. Of that total, wine accounted for almost half with 263 new introductions — more than doubling last year. Beer and vodka, too, virtually doubled introductions from the prior year.

Finally, fruit drink introductions were down, slightly; and flavored and bottled waters and energy drinks were all down dramatically compared to last year. Noteworthy is that energy drink introductions dropped almost 50% year-over-year.

Takeaways from InterBev 2010

• Overall beverage introductions, despite two difficult economic years, continue to grow, and grow rapidly (+22% year over year).

• Some beverage categories — energy and flavored drinks — are growing slowly suggesting a mature or saturated market.

• Alcohol beverages as a growth category are bringing more new products to market than the next three beverage categories (Coffee, Carbonated Soft Drinks and Juices) combined (543 vs. 518).

• Amid the growing clutter that most consumers face at the retail point-of-decision, the critical tools for building brand awareness and driving sales are Product Packaging complimented by Managed, Controlled and Measured Marketing at-Retail initiatives — but you can call it POS, if you like.

— Mark Fullerton