Got to meet Jennifer Cue yesterday at Beverage-Digest conference.
Nice lady. Seemed competent. Spoke of her 25-person company. Built and held together by the passion of the team. I was of the opinion, prior to yesterday's conference, that JSDA was a competently-run company, and that was reaffirmed.
Lemoncocco was available for testing. First time I had ever seen it "out in the wild" and I sampled it. I abhor coconut but strangely I can palate coconut drinks. Still, no coconut drink is for me and I'm not the person to judge its taste. It seemed to be received well by others I saw sampling it. Lemoncocco is reportedly less sweet than its European counterpart. It's not as "strong" as a normal coconut water drink. Probably aimed at a more "mature" audience than Jones. Might be a decent mixer with soccer moms.
Per Cue, Lemoncocco is a "tiny percentage" of their current revenue stream, which isn't surprising. What's the upside? Given the name, it's probably going to remain a single SKU item. I don't see this being a $10M drink. 99% of new beverages never reach that level. But can it be a successful niche drink that drops profit to the bottom line? I think it has a sporting chance of selling but not sure how much profit it can drop down to the bottom line. It'll be a volume producer, which is important for small beverage companies, but I don't think its going to be a value producer. Doesn't sound like it's going to go through the same doors as Jones Soda. So the distribution network will have to get wider (good thing) but its less efficient (preferable to have all your products go through the same doors). The efficiency is where the value arises, dropping crucial $$$ to the bottom line. I would've preferred a foray outside of Jones Soda to be a little more complimentary with the anchor product (at least distribution-wise). Lemoncocco does feel like a "passion" product for Cue, a drink she found in Italy, along with her husband, under the Tuscan Sun, que the romantic music.
Has some e-commerce appeal since its packaging is appealing to the eye, appeal to an affluent demographic, feels like a "summer treat", and its containers are aluminum cans, which are more cost effectively shipped through the mail. Jones is limited on the e-commerce front since it's mostly sold in bottles (weight prohibitive).
They've made headways with some retailers by going the "Italian route". In other words, Lemoncocco will show up in the international sections of grocers and be the only beverage in a food aisle. For example, located between the biscottis and the pasta puttanesca (whore's pasta). They just found some select distributors (who didn't require a contract) to distribute within NYC. Being married to an Eye-Talian from Brooklyn, I can tell you there are a lot of gi-nees in NYC. So, if there one city Lemoncocco needs to be sold in, it's NYC.
Couldn't get much color on Spiked Jones but the first shipment goes out in June. Not sure on JSDA's revenue recognition policy but most beverage companies recognize once a product ships. Should give Q2 a nominal spike. And I assume it will be sold in the same outlets as Jones Soda, which is a good thing.
