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- [00:00]
A
Jordan I'm Jordan Bass from Hopwater and you're listening to the CPG Guys Podcast.
- [00:07]
B
Welcome to the CPG Guys Podcast. Your host, Shree Rajagopalan and Peter Vs. Bond explore how brands and retailers engage consumers in an increasingly digitally driven world. And now, here are the CPG guys.
- [00:27]
C
Hello and welcome to this episode of the CPG Guys. I'm of course Sri, your co host and also CRO and co founder of ThinkBlue Consulting, your trusted partner in your Omnichannel development journey. Get in touch with me there@srinkblueconsulting co.com co please do listen to my older daughter's music at www.riaraj.com. follow Lara Raj. My younger daughter is a member of the world's fastest growing global glows group. Cat's Eye recently performed and set a record at Lollapalooza, 85,000 attendants for a daytime performance on the main stage. I'm of course joined today by my co host, pvsp Peter V S Bond, who also moonlights as head of industry and client engagement at Flywheel, the commerce acceleration division of none other than Omnicom. Peter, how you doing man?
- [01:14]
B
So, father of pop stars, tell me about your growing TikTok influencing Persona. Now you think blue, you are CPG guys. You're Paparaj. But now you're TikTok influencer. What's going on here, brother?
- [01:32]
C
I just refreshed my instagram. It was 30k overnight followers, 31.2 and then I'll go to TikTok in one second over here. Last night it was 36.38.2. So I'm overwhelmed. But it's a lot of fun. I'm enjoying this. I actually know how to edit a video end to end on TikTok and make it less than 10 seconds. Skill set I didn't have two months ago.
- [01:58]
B
I told you, you need to learn how to tilt your head back and forth like a Luddite boomer. You know what I'm talking about, Sri.
- [02:05]
C
You need to evolve, Peter, into the Generation now. I call it Generation Now.
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B
Generation Now. Generation Now.
- [02:12]
C
No, it's not X, Y, Z. It's Generation now. Get with the program, man. The big question we're going to ask Jordan later today. CPG guys, be active on TikTok. But before we do that, make sure you're subscribing to our podcast on your preferred listening platform where you can get the latest episodes. Go back to consume some of the 500 plus episodes we've already published today. We are pleased to have with us a guest whom I've been discussing being on the show for over a year. So we're going to get to it as soon as possible. So join us in welcoming Jordan Bass, co founder and CEO of Hop Water, the hop infused non alcoholic sparkling beverage that's making serious waves. Get it, Peter? Hop making waves in the functional beverage space. Jordan's background spends finance, brand building and strategic ops. And with Hop Water, he stepped into a white hot consumer insight. People want to cut back, not miss out. No booze, no sugar, no regrets. Bold flavor, functional ingredients, satisfying taste of hops. He's building a brand that sits right at the intersection of wellness, moderation, social connection. From TTC to retail, Hop Water is indeed showing up strong in the marketplace. Jordan, welcome to the show. How you doing man?
- [03:21]
A
I'm excited to be here with you two legends. And let me start by cracking a Hop Water here.
- [03:25]
C
I love that hat, by the way.
- [03:27]
A
Thank you.
- [03:29]
C
For those of you, hopefully we'll get your hat on one of the clips on social media. We're excited to have you. Needless to say, Jordan will include in the digital show notes of this episode, links to your LinkedIn profile and of course the hot water. So I'm going to kick it off and obviously the first question that the audience wants to ask you, not just me, how water? What's the aha moment that sparked the idea why the name? You left a career in finance and business to launch a beverage startup, arguably one of the hardest spaces. DST control and owned by Mega Brands, Coca Cola and PepsiCo and all the several beverage brands under them and their bottling systems. What's the courage here? How do you take that leap?
- [04:10]
A
For sure? Yeah. Well, first of all, I mean from a entrepreneur stand, what I've always admired entrepreneurs. You talked about it being a hard category and I think like starting a brand and certainly starting a beverage brand is just like one of the hardest things that you can do in business. And always like testing myself. I'm a endurance athlete, like to kind of push the limits and so that was kind of always appealing. But my aha moment for the business. I'd like to say my co founder and I were kind of on independent paths to the same conclusion. We both have always been healthy outdoor lifestyle guys love drinking beer. I grew up in a small town in Northern California and kind of the heart of the craft beer revolution. I recently saw a New Yorker cartoon that said craft beer isn't a hobby and I felt like that was intended for me. And so you Know, love drinking craft beer, love doing outdoor stuff. And I found that as I got older and busier that there was just a bunch of occasions where I wanted that moment of cracking a cold one, but didn't want the alcohol, calories, carbs, et cetera. And Nick, my co founder, is former Marine competitive athlete, he would say the same thing. And we kind of found that we were drinking a bunch of berry flavored Lacroix and that wasn't that satisfactory. After having a couple at the office or returning to non out beers, they were still high in calories and carbs didn't quite hit the spot. And so when we didn't see something in the market that kind of fit that need, we said, you know, let's go build it ourselves. And part of my aha moment was that my wife had actually gotten pregnant with our first and I found that I was drinking a bunch of double IPAs on the couch at night and that didn't really align with my fitness routine. I was training for a triathlon at the time and said like, okay, you know, there's got to be something better out there. So we started tinkering in our backyard and, and eventually came up with what became Hop Water. And we were fortunate that when we launched it, there was a bunch of other people that loved the product too.
- [06:09]
B
Hey, Jordan, welcome to the podcast. We're really glad to have you here today. You're down in la, I know, but you said you're from Northern California. I'm a little suspect you're probably one of those horrible Giants fans. I'm a Dodger fan. So we're going to walk away from baseball for right now. Let's talk about Hopwater's actual product. I'd love to understand as you went about creating it, because you mentioned that effort in your last response. How did you think about balancing the functionality you were looking for? Adaptogens, nootropics with taste and consumer satisfaction? Because it's one thing to have something functional, but if they don't like the way it tastes, you're kind of dead in the water. So tell us how you balance those two competing, seemingly competing challenges.
- [07:00]
A
Yeah, I mean, I think you nailed it. I mean, I think in cpg, if your product doesn't taste good, you're done for it. Like there's maybe there's a few small niche areas in that are super functional where you can get away with not having a good tasting product. But first and foremost, product has to taste great. So you're right, that was the primary filter And I think when we look at what our consumers are looking at, it's certainly taste first, function second. However, what we saw in the market and what we looked at for our own personal need was when you have that moment of kind of like cracking the cold one part of that is that downshift moment from work to play or from, you know, your work to the weekend, whatever it is. And having some functional, like cracking, having a beer is functional to some degree. And so replicating that in our product, we felt was an important aspect. Two, when we did kind of our desktop research, we found that 82% of consumers are looking for functional in their everyday beverage. And I think if you step back, it just makes sense with consumer trends like everyone's busier, everyone's lives are impacted. And I think consumers are looking to get more out of everything, out of every product that they're. That they're consuming. And so with that both taste and functional benefit, we are able to deliver more value to the consumer. So that's one, and then two. To your point, just during the kind of formulation process, we were very careful to make sure that functional didn't impact the taste negatively. And I think, you know, with our product, the hops, the flavor still come through. You still get that piney, citrusy aspect of the hops that are kind of the most prominent in the, in the beverage.
- [08:38]
C
So, Jordan, flavor development, right? Take us through the portfolio. What kind of flavors do you have? How did you actually develop them? And then the flavors that you currently have in the marketplace, what's the early consumer feedback? Retail feedback, because you're not just non alcoholic, you're functional. And that dual positioning, how's that working out for you?
- [08:58]
A
For sure? Yeah. Well, so when we launched the brand, we launched with three original flavors. One that I'm drinking now, which is our blood orange, mango, and our classic flavor. And funny enough, blood orange is actually still our number one seller today. We've expanded the portfolio from there. We have, I don't know, eight, ten flavors now, including ruby red, grapefruit, lemonade, black cherry, lime, and several others. You know, when we first kind of developed the product, we utilized our. We have like kind of a proprietary digital testing method that we utilize. And so we actually will do, like any good CPG company, we'll do desktop research. We'll see what flavors are trending in the industry, but then we utilize social, as you kind of talked about earlier, and we'll actually test the flavors with our consumers before we ever even launch it. So we not only See what consumers say they like in surveys, but we'll see what they engage with and what they're willing to interact with. And it gives us another level of conviction before we ever launch the flavor. And then what we'll do now that we're in both E commerce and retail is we'll launch our products in E commerce. We'll see does that actually. Will the consumer actually purchase the product? And what are the kind of metrics look like? And then we'll take that, take the best winners to retail. It both gives us the conviction that we've got a winner that consumers will actually buy, but it also gives us the initial data for the retailer to say, hey, among our other flavors, this ranks X, Y and Z. And so that gives some nice conviction to the retailer. I'll tell you a funny story. When we first launched and formulated the beverage. So when we launched the product in late 2020 and when we were formulating, it was kind of right when Covid had hit, right when the pandemic had hit, we actually, we started formulating prior to the pandemic, all normal kind of process. And then Covid hit and we were kind of like on our last round, we'd already been through several rounds. We were right there about to finish it, and our partner was kind of like, we don't know what to do. Like, halt on everything. We're like, no way. We have to continue. We've got to. We got to finish this up. So anyway, we convinced them to finalize the formulation. We go up and meet them, and they come out literally in like hazmat suits with the products on a tray. We're in the back of our car with the trunk flipped up. We taste it. We're like, look at each other. Like, this is it. High five. We got it. And that was how we locked in our final formulation.
- [11:25]
B
All right. It's so much to unpack there. That's a great story, George.
- [11:29]
C
I got a. I got a follow up for him. Right. And that is going back to the retail world. How do you actually solicit feedback from retail? Are you talking to merchants? Consumers live.
- [11:40]
A
Yeah. In terms of flavor development. Yeah. So certainly. Yeah, we'll share samples with our retailers early on. We also have a great network of distributors and, you know, some trusted distributors we've worked with for a long time. And so we'll get new products in their hands. I mean, those distributors have such great insights into the market. They've seen so many brands and what works and what doesn't work. And so yeah, we try to bring as many people into the formulation process as possible. We also have a group of kind of loyalists that we've developed as a tasting panel. And so we'll actually solicit both flavor input from our consumers, from our kind of loyalists. We'll go say, hey, what flavors would you like to see next? But then we'll also include them in early tasting panels and send them raw samples and get their feedback.
- [12:27]
B
Jordan One of my favorite books that I think entrepreneurs probably are generally familiar with is Geoffrey Moore's Crossing the Chasm. And it's about startups and what it takes to get the end of that hockey stick and start shooting up. You start at D2C. When you start D2C in beverage you're up against one of the biggest costs, which is the freight cost because you're shipping a beverage. It is heavy by nature. Right. And then you moved into retail. I'd like to understand from the distribution standpoint how you manage that ship your shift successfully. And I'd love to know about what your first big retail win was and how that taught you about actually crossing that chasm and scaling this business.
- [13:17]
A
For sure, yeah. I think first of all E Comm is I think complementary to retail for us and they're totally two different structures to run as you talked about. So the point we launched in E Commerce that allowed us to quickly get product to the consumer, quickly get feedback. You referenced that book. I think another book that I like for startups is the Lean Startup and in that they talk about just rapidly iterating launch before you think you're totally ready to get feedback from your consumers. And E commerce allows us to do that quickly. And in the early days that was really helpful. I think now it's a way for us to one, interact with our most loyal consumers. But two, it's also a way to drive trial for consumers and get product into consumers hands. And then as they become, as they repeat further and they see products on the shelf at the retail, they they shift into a retail customer. You know, as far as the our first big win. So we launched E Commerce we very quickly we knew obviously we were a beverage brand. We're going to build into retail. So we quickly moved into retail. Erewhon was our first retailer as you might suspect in Southern California. So we moved into the natural channel. They were a great proof point. We continued to build in the natural channel and then we kind of started to look at kind of crossover retailers and then conventional so Wegmans out on the east coast Was probably our first like kind of crossover retailer. Great retailer, great retail partner today. And then ATV was really our first big win in conventional grocery. Again, an amazing retailer and great partner today and we've been able to learn a lot with them. I like to say to my team, and one of my favorite quotes is that as you can have this vision of a great product, you know that consumer is going to like, but if you can't execute and get that product to your distributor, to your retail, to your retailer, get all of the right pieces in place like you're dead in the water. And I think to your question about E commerce versus retail, that was probably what taught me or was the biggest lesson is just in retail execution is so, so critical. In E commerce you're more focused on the marketing side and the digital ads. Right. Like the fulfillment part is not that hard to do in E commerce or in retail. That route to market, that aspect of getting on self, staying on shelf takes a lot more effort and is super important to the brand's success.
- [15:59]
C
I want to get back to discuss the difference. You said two different structures to run online and digital and then retail. We of course, Peter and I are practitioners three decades, some of the largest brands in the world. We've touched from Pepsico, J and J Whatnot, cvs, Dunhumby, you name it, right? Tell us why the difference? How do you operate them and what's the different thinking? You've been there. You yourself are very omnichannel in nature. So how do you keep those things functioning independently or do you bring them together at some point?
- [16:33]
A
Yeah, you know, so in certain areas I'd say that we have our teams or our work streams are a little bit more separate and some of them are more integrated from a company standpoint. Myself and our executive team are always thinking about how both channels are complementary to our overall business. So as I talked about, you know, I think E commerce, we do a lot of digital ads with E commerce. That creates brand awareness and drives trial, which complements our retail business. So that's a really important area that they cross over from a logistics standpoint. When we first launched, we actually used to have two totally separate logistics networks. We had different warehouses for E commerce and for retail. Over time we're able to bring those together and fully integrate those so that we have the same warehouses serving our retail business and our E commerce business. So I'd say over time the organizations have melded more and we've been able to bring them together. And you know, and part of that is just training. Like I knew both kind of sides but not everybody understood the way that retail and e commerce functioned. And so we'd have some. A great retail leader and we need to train them up on e commerce or vice versa. And great e commerce leader and needed to train them up on retail. So it's been a little bit of the evolution of the organization.
- [17:48]
C
It's the dilemma of the large brands. Right. To figure out how to do that and bring it together. So what about online visibility and conversion? Do you see a difference in each of the channels? One easier one harder? Does one feed the other?
- [18:01]
A
You know, I think that. And maybe just backing up. I also was fortunate to work for a large CPG company where I was able to see the way that a good e commerce and built the way that the e commerce business operated. So I had kind of that experience and was able to leverage that for our business today. I think in terms of conversion, in the way that the different channels operate, from a marketing standpoint, they operate quite differently. As you guys know, in the retail game, you have a couple seconds at the shelf to message to your consumer and you really. And to win your consumer. And you don't have the ability to have 10 different messages at the retail shelf. Like you have to have a focused message. So a couple years ago, we changed our tagline to positively refreshing, which encapsulates both the refreshing nature of the product, that kind of moment, you're cracking a cold one. But also the functional benefits on the online space, we can have 20 different messages tailored to our specific consumer group. And we do, you know, we. I mean, it's not. They're not like completely different, but we're able to hone the messaging a little bit more specifically for that specific customer demographic. So I think the two channels from a marketing standpoint do operate actually quite differently.
- [19:17]
C
And all the process and bureaucracy of the large companies. Are you just happy that you don't have to deal with it again or have you found that as you scale, you've had to bring a bunch of process in?
- [19:28]
A
You know, we've tried to bring. Certainly as we've scaled, we've had to bring process to operate more efficiently. We've tried to bring process in the areas that it's helpful. So in logistics and manufacturing and quality control and those types of things, process is incredibly important. You need to get that right every single time. You know, in marketing, we try to be a little bit more open to new ideas and innovation and try not to be so rigid. To your point, I Think in the larger companies, you get maybe a retail message that works super well. And then you try to translate that to the digital world, whether it's E commerce or digital in general. And you need to be a little bit more experimental. You need to be open to whatever the trend is or speaking in kind of a more digitally native language. And so we try to be more creative in kind of digital and E commerce.
- [20:22]
C
Awesome. Let me remind our audience that today we're speaking with Jordan Bass, CEO of Hot Water.
- [20:27]
B
So, Jordan, if you need to do things that are a little more edgy from a digital perspective, I know a father of pop stars that isn't But a growing TikTok influencer that you could probably bring on board as a. As a brand ambassador. I'm just saying.
- [20:47]
C
Love an intro as well, Peter. CPG Guys can use it.
- [20:50]
B
Yeah, well, exactly.
- [20:51]
A
Good idea.
- [20:52]
C
Could you ask that person to wear CPG Guys gear, perhaps?
- [20:54]
B
Exactly. By the way, Jordan, you will. You will be getting a CPG Guys T shirt.
- [20:58]
A
Nice.
- [20:59]
B
After the event. And the big aspiration is for those that come on the show five times, kind of like Saturday Night Live, they get a CPG Guys varsity jacket, wool and leather. It's very nice. It's high end. So there's. You got four.
- [21:13]
A
Nice. Well, we'll have to return the favor and get you guys one of these hats.
- [21:17]
B
I. We love that. We love that. Okay, so let's talk a little bit about brand building. What have you found so far has been particularly effective at building brand awareness in a highly competitive category. You know, you've leaned into wellness and lifestyle messaging. How do you ensure as you're building brand awareness that the authenticity in your branding is not only prevalent, but is well recognized by the audience as you are creating this for sure.
- [21:52]
A
Yeah, there's a couple items in there. One is kind of like the maybe tactics of brand building and awareness and then is kind of the messaging. You know, I think we talked about big cpg. When you're a big CPG company, you can go buy a, you know, 20 or $50 million TV campaign and you can, you know, blanket with awareness that way, when you're an emerging brand, obviously you don't have the budget to do that, so you have to find other ways. And digital for sure, is the best way to do that. And I think it's how most, you know, young emerging brands are built. So we lean on digital really heavily to build our brand awareness. And then I think the other thing that you talked about, you talked about authenticity and how we've kind of built, I think, as an emerging brand, one of the things that you need to do early on is identify who your loyalists are and who your community is. And then because you don't have that $50 million campaign or TV campaign to blanket everyone in America, you want to gain high awareness with that consumer that is likely to purchase your product. And that's really what we did. We identified who our core consumer group was, our consumer groups were, and then went hard at the events, the digital things that those people were seeing. And so things like events where they're at, you know, whether that's yoga events or whether that's beer festivals, whatever it is for our, you know, specific wellness consumer. And then getting cans in hands is such a critical and, you know, maybe overlooked area in beverage. Like, just getting the liquid to lips is one of the most important things I think, that you can do in beverage. So we spent a lot of time and effort doing that. I was just actually at the All Star Game in Atlanta, and we probably handed out, I don't know, 5,000 cans to consumers. And the amount of consumers that that, like, introduces to the brand is incredibly valuable.
- [23:43]
C
Peter, what is an All Star Game? What is he referring to?
- [23:45]
B
I have no idea. Do they look up at the sky at night with a telescope? Is that where they see all the stars?
- [23:53]
A
Exactly, exactly.
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C
They're looking for the SpaceX satellites.
- [23:56]
B
We're going to have to look into that. Sri.
- [23:58]
A
I want to go back to your piece on authenticity, too. You asked about how do we stay authentic. I think for us, in the beginning, I maybe referenced that we built this brand for ourselves. So I think authenticity is just kind of built into our DNA. We're fortunate that we're, like, building the product for ourselves, for our families, for our friends. And so. And we live in Southern California, and the brand is kind of built on the Southern California lifestyle. So it's really like, what are we doing? What are we seeing? What are we living? And so I think, again, authenticity is just built into the brand. Maybe that's a little bit of a difference to what you referenced earlier with kind of big cpg is that we're not saying, oh, this is the demo we want to target, and we're sitting somewhere completely different and trying to imagine what our consumer likes. We know what our consumer likes. We are the consumer. And so we're able to, I think, just, you know, build a little bit.
- [24:46]
C
More authentically so cans and hands. So let's talk about community. How's the community responding to cans and Hands. Are they picking up cans and hands. Who is the hop water ideal target consumer for you and how do you actually stay engaged connected with them? And how are you building this community you just referred to?
- [25:04]
A
For sure. Yeah. Multiple ways. We like to call our consumer the enlightened overachiever. And you know, I think that that person. Whoa, whoa, whoa.
- [25:11]
C
Hold the presses. Peter, do you know any enlightened overachievers or unenlightened overachievers or enlightened underachievers? I'm just bitter he didn't invite us to the all Star game.
- [25:21]
B
Sree, you're still on the hands on cans as a romantic brand marketer, to me, it was always about the liquid to lips. You know, that's what I'm still focused on.
- [25:32]
A
I think you guys fall into our enlightened overachiever category. We certainly welcome you, Ed.
- [25:37]
C
First time somebody's called us an overachiever, Peter.
- [25:40]
A
Hey.
- [25:40]
B
Hey. I graduated in the top 75% of my class in college. I'll have you know, it's never too late.
- [25:46]
C
Did I graduate? I don't know. But community, Jordan, you're a.
- [25:49]
B
You're a hokey. Sree. I don't know if they call it graduation or what, but hey, what happens in Virginia stays in Virginia.
- [25:57]
C
Well, they say Virginia is for lovers, but community, Jordan.
- [26:00]
A
Yeah, so look, I think community, you know, building is very important again for a smaller company. And we use multiple ways. Talked about a little bit of them earlier. I think our direct to consumer business is a way that we're able to talk specifically to and directly to our loyalists. And so that's a nice way to build community, you know, that we're able to directly email those folks, get responses, etc. See what they're engaged with. And then we try to be, you know, really involved with our consumers on social. So I'd say up until very recently, I was going in and liking and commenting on every post where someone would tag our product. You know, I was doing the customer service for a long time. Actually, one of our customers just posted on LinkedIn that they found my number randomly and they had a custom. They had an issue and they called me and I picked up and helped them with the issue. And they were. They were talking about how they kind of have become a loyalist from that. And I love those interactions. Right. I'm able to not only help someone with a problem, but then understand, like, what do they like about our product? What encourages them to buy it? And we use that in our. In our, in our Business to get feedback from our consumers. So that's one way. Another way to build community is talked about is just events like we talked about the All Star Game. But we go to a bunch of beer festivals, we go to, you know, yoga festivals, et cetera, and just physically interact with our consumers. I think for a young emerging brand, putting a face to the brand, whether it's myself or it's the rest of our team, which are all brand ambassadors, is so important. It just gives kind of, you know, real like connection with the consumer and with the product. So. So I'd say social events and real community engagement through our digital platforms.
- [27:46]
C
You're saying we have that many intellectual overachievers?
- [27:50]
A
Oh, yes. We have tens of millions of them.
- [27:52]
B
All right, I like it. Sri. We aspire to be in that group.
- [27:55]
C
All right, Someday, someday.
- [27:57]
B
I know. Let's, let's, let's take it back up to 30,000 foot level for a second here. Jordan, where do you see the future of the functional beverage space heading in the next three to five years? Is this a permanent cultural shift around drinking behavior in moderation or is this just like a little blip in the history? And I think probably not, but I'd love to hear your thoughts on it.
- [28:26]
A
Yeah, look, I mean, alcohol isn't going away. Like it's a huge category and it's going to continue to be a large category for a long time. You know, that being said, I think consumers drinking behaviors are changing even within the alcohol category. Right. Hard seltzers weren't a thing a number of years ago. Now it's a meaningful part. RTD's, etc. Are.
- [28:45]
B
Can I ask you about that? I saw one that there's a hard seltzer that now has a zero version. Isn't that just seltzer? Like why would you pay. I'm sorry, that's, that's like taking, that's like. Well, I don't know.
- [28:58]
C
It could be sourced from hard water.
- [29:00]
B
Sri, if you can make a brand out of commodity purified water the way some companies have, like, and you can get consumers to buy that, more power to you. But it's a. Yeah, I'm just.
- [29:12]
C
30 years in this industry, we know too much about ingredients and commodities.
- [29:16]
B
But you know, like Jordan, so at least one of the CPG guys doesn't drink alcohol anymore. The other one has falls off the wagon every now and again. We won't mention him by name. It's not me. But you know, I'm assuming that you're targeting people that aren't just me that are, that do drink alcohol and have value. I'm just like, do you see this as being something that people who. I guess what I'm saying is from the behavioral shift, people who still drink alcohol may just want something where they get some of that experience without another experience in between their time stream. Like, what are your thoughts around this?
- [29:57]
A
Yeah, for sure. I think moderation is a long term trend and it's certainly not a fad. Long term trend. I don't think anyone's saying it's a fad at this point. Like we're seeing the leading indicators of what generation now, as you put it, is, you know, saying about their consumption behavior. And what we see is that 75% of our consumers drink alcohol. So there's 25% that don't drink. They're great consumers. We love those consumers. We want to serve them with a great product. The largest portion is consumers that are moderating. So whether they're taking their Tuesday night off, they're taking the week off, they're taking the month or the year off, they're still enjoying an alcoholic beverage. And I think what those consumers used to do is they would turn towards a glass of ice water or a soda that was filled with calories and sugar. And now we're giving them a great alternative so they don't have to miss out. They can still have fun without missing out, basically. And also for the beer aisle where we typically sit, we're not losing that sale to a glass of ice water or sugary soda. We're bringing that consumer down the beer aisle. We're reinvigorating the non up beer set, making it a destination, not a kind of pariah in the corner and somewhere that consumers actually want to go and seek out a great product. So yeah, I think that, you know, we're seeing moderations, a long term trend. You know, today non out beer is a little less than 2% of the overall beer category. If that grows to 5, 10, 20%, I mean, you're talking about a massive shift and a huge growth opportunity for brands like ours.
- [31:30]
C
How are you staying abreast of these trends? Do you read a lot? Is it LinkedIn? Are you just talking to retail a lot? Is it all of the above or you're listening to the CPG guys?
- [31:39]
B
Do you listen to any relevant podcasts by chance?
- [31:42]
A
Of course. The CPG guys podcast, my number one source for CPG news. Yeah, no, it's all of the above. I mean, I'm, I'm constantly reading, certainly all of the trade periodicals. They have great data, honestly, and about the industry. I'm of course reading all of the business periodicals and then talking to people. I talk to consumers, talk to retailers, talk to distributors. So, yeah, all of the above. And I think as a leader of a company, it's your job to stay informed on all of the trends.
- [32:10]
C
It's time for advice. You ready to shout some advice, Jordan?
- [32:14]
A
Sure.
- [32:14]
C
All right, so startups, lots of fun once they scale. You're in that mode right now where you've scaled. There's a lot of fun going on. You're in retail distribution, which is always fun to manage, but you've reached a stage where you've scaled. The journey could not have been easy. Or maybe it is. And we're just, we'd love to know, how was that journey? What would you never do again? What is it that if you knew now that you did, you'd replicate in 15 seconds and say, that's the only way I want to do it. AKA what's the advice you want to give? Others who are listening in are budding founders or hope to be founders, Especially in the beverage segment for sure.
- [32:51]
A
Yeah. First of all, to your point, building a brand is very hard. Like there is get ready to grind, get ready to, you know, put everything into it. And I think that's not only for me, but that's for our whole team. Like everyone's thinking about this on the weekend, in the evening, like it is full on. So get prepared for that. I like a challenge, so that wasn't a problem for me. But you should just get your head around that. I think from advice standpoint, you know, maybe there's a couple of things on beverage, but I think just CPG more broadly. One in beverage and really CPG is raise more capital than you think you're going to need. It is definitely a capital intensive business. Consumers, and I don't blame them, are not going to give you any forgiveness for poor quality or poor, you know, marketing or your product not being on shelf because you don't have the budget to do that. Like, you know, they're going to compare a Coca Cola, a Coca Cola product to your product and you need to, you need to, you know, be up on the game. So raise more capital than you think you're going to need. Two, I think is for me personally, one of the things that I learned was not to get too caught up in paralysis analysis, like, do the analysis like, you know, look at everything, but then just make the decision and go. And I will Give my co founder a lot of credit here. He was very helpful. He'd been through the journey before and was a. It was nice to have someone with complementary skills where we get to the point where we've done all the analysis. Then it was just like, okay, what's the decision? Let's go, let's just take the risk, let's move forward. I think that as a budding entrepreneur or looking at a concept, you try to like, think of all of the eventualities, okay, well what is consumer going to secure or what could happen here? Like, could this not work because of X, Y and Z? And the reality is you just can't see all of those until you get going. You'll see so much more and you'll see the solutions as you get going. So I think just get going.
- [34:53]
C
On the capital side, it's actually great advice. But one of the things that holds people back from capital or two different paths here. One is they don't have the credibility to raise a lot of capital. But the other one and more important one is they don't want to give away equity. So how did you manage the second one for sure.
- [35:09]
A
Look, I think like you can, I mean this is classic sort of startup advice, right? You can own a smaller piece of a big thing or you can own a big piece of a small thing and you just really have to, I think, make that personal decision on what you're looking for if you want a fast growing startup. I don't know of many fast growing startups out there that haven't raised capital and brought in investors. So I think you just have to get your head around that. And frankly, investors can add a lot of value. You know, we brought in investors that have helped us strategically, both with introductions, connections, advice. So you know, it's not just capital. You can also get like a real benefit from having smart people around the table that have done this before.
- [35:48]
B
I'm intrigued by the fact that you gave your co founder credit for coming up with some really great ideas. I may have to try that sometime. I'm not. It's a little unfamiliar to me. I just, I just don't want to feed his ego.
- [36:00]
C
But you'll, you'll stay, you'll stay a boomer luddite for a long time, Peter.
- [36:06]
A
I probably will.
- [36:07]
B
Sri. All right, so Jordan, let me close this out with Looking to the future. What's, what's next for Hop Water. Is it about new flavors? Is about new formats? Is it about international expansion? Is it about all three? Like what is Your what is what's on your roadmap for growth that you'd love to share with our audience?
- [36:28]
A
For sure. I think it's going deeper with what's working. You know, we're still in teens percentage acv. Like there's still so much to do in terms of retail distribution in the US Both within our existing channels, but in new channels also. So we've started expanding into the C Store channel, which is a new area for us. I think that's a huge long term growth opportunity over multiple years. We have a really exciting retail launch in the next couple of months. A big retailer nationally that we'll be launching with in October.
- [37:02]
C
Congratulations.
- [37:03]
A
Thank you. Appreciate that. So one we've been working on.
- [37:05]
C
Let us know how the CPG guys can amplify that for you when you get there.
- [37:09]
A
Cool. I will. Yeah. It's one we've been working on for a long time, so I appreciate that and I certainly will. And then we have a couple new product launches. We just launched our iced tea and lemonade which is doing really well. It went nationwide with sprouts. It's going into a couple other retailers now, so that's getting really good traction. And then we have a limited edition offering an LTO that we're launching, I think in October, our spiced Apple. So seasonal product that we'll be launching. So that should be a fun launch.
- [37:38]
C
How awesome. As we actually wrap up here, Peter, you know, one big takeaway for me. There's one sentence that has stood out in my head. You know, I asked Jordan what's the best advice you can give others who want to be an entrepreneur. And I think the takeaway, biggest takeaway from this episode. While Jordan said a lot about just running the business, starting it up, flavor profiles, ACV concerns, ACV development, new ideas, new growth. The ones message that stands out, make sure you raise the right capital as a founder. Thoughts, Peter?
- [38:10]
B
Yeah, I agree, Sri. I'm still stuck on the liquid to lips.
- [38:14]
C
I think that hands and hands baby.
- [38:15]
B
That's going to be the hashtag that goes on cans and hands. Liquid to lips. I think that'll be the hashtag on the T shirt we immortalized Jordan with. But no, to me, it's very much about that. How do I deal with the complexities of physical retail and the fact that it takes a lot longer? And at the end of the day, for all the glorious marketing, the design of the can, the flavor of the product, like if you don't have it visibly present for consumers at retail, none of that matters. You just, you gotta get it in their face. If it's not in their face, they're not gonna pick it up for sure.
- [38:55]
C
What a terrific conversation. Let me thank audience for listening to this episode. Do leave us a rating and a review on Apple podcasts, Spotify or a favorist listening platform. Cause it informs us how we're doing as well as if we're having the right conversations with the right guests. To all of you, thank you from Peter and me, to all our sponsors, whether of this podcast, our parties, events, hosted dinners, having us at panels. Thank you, thank you, thank you. Without you, the show doesn't exist. You make the show happen. Jordan, it was a pleasure talking to a fast scaling functional beverage founder. Thank you for joining us on the show.
- [39:31]
A
Thank you for having me. It was a pleasure Peter.
- [39:32]
C
Always fun doing this with you week over week. Thank you for joining me as always, Peter.
- [39:37]
A
I love it.
- [39:37]
B
Sree, this was another great episode. I'm looking forward to being an actual consumer of hop water. This is. And you know what he said? They shut. They sell it at Wegmans. Guess what just opened in Connecticut. Sree, you know this our first Wegmans store. It's now my weekly shopping destination. Can't wait to give it a try.
- [39:59]
A
Love it.
- [39:59]
C
Hands in hands, baby. That's what's going to happen with Peter this weekend. And that's a wrap of this episode of the CPG Guys.
- [40:17]
B
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