O-H-I-O! Other than that kind of annoying chant, what’s the easiest way to know that someone is from Ohio? They will usually tell you! As an Ohioan myself (see what I did there?), I’ll admit we don’t have special water that allegedly pumps through New York pipes that make their bagels and pizza so great. We also don’t have much sunshine like Florida, but there’s always one interesting insight I share with my startup CPG entrepreneurs about Ohio. Throughout much of the last few decades, Columbus has served as America’s top test market for businesses trying out new products in the real world before deciding to roll them out nationally. The demographics of Ohio’s state capital have always been indicative of the rest of the United States…just on a smaller scale where you can see high-rises and rural farmland within a 15-minute drive.

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Short-term arbitrage or long-term strategy? Either way…is it time for supplement brands to start hedging those TikTok Shop bets? It shouldn’t be news to anyone at this point, but the U.S. House of Representatives overwhelmingly passed a bill last week that would give ByteDance about six months to divest the U.S. assets of TikTok or face a ban. If that desired result sounds familiar, it’s because the idea of a TikTok ban has roots in the Trump administration. In fact, a deal was even worked out where Oracle and Walmart would become minority owners in ByteDance. That deal eventually fell through, and Trump’s ban was struck down by a federal court. By the time Biden came to office, he rolled back Trump’s executive order and began private negotiations with TikTok. ByteDance was founded in 2012 and is now valued at just under $300 billion. ByteDance is often seen as the world's leading company on algorithms because its flagship apps TikTok (and TikTok’s sister app in China) are powered by commanding recommendation engines that make its apps extremely attractive to users. And it’s those powerful algorithms within the popular Gen-Z app that are at the heart of this ban TikTok national security debate. American lawmakers are concerned about TikTok’s relationship with mainland China. Like with most big Chinese companies, China's ruling Communist Party has set up a party branch at ByteDance. Scrutiny over ByteDance expanded further after the government took a stake in its local subsidiary that awarded the Chinese government a board seat at the subsidiary. So, American lawmakers are worried that the Chinese government will pressure ByteDance to share U.S. data gathered on TikTok, which the CCP could potentially use for nefarious reasons. In this content, I'll also share my strategic game theory breakdown on why banning TikTok has now become a lose-lose situation. Additionally, I share details around the social commerce trend that's powering TikTok Shop. The meteoric rise of TikTok offers supplement brands a plethora of opportunities from brand storytelling to sales expansion and various collaboration strategies. Whether it’s FitTok/GymTok advice, Hot Girl Walks, hydration in those Stanley Cups, or under-desk treadmills, TikTok has defined many health trends. So, it shouldn’t surprise you that as much as 85% of the total U.S. market TikTok Shop sales were with health and beauty products. One of the biggest health category merchants has been RYSE, which I'll share comments from its founder Nic Stella in regards to the power of leveraging TikTok. But don’t let those huge RYSE TikTok Shop sales numbers blind you because there are still risks for functional CPG brands beyond those stemming from the total ban of TikTok. This was something I recently talked about with one of the top CPG industry lawyers Ryan Lewendon. But either way, I don’t see a future without social commerce. It has now become too entrenched, too popular, and too valuable within the U.S. market. Moreover, details were leaked on an Amazon and Meta partnership where customers would be able to shop Amazon’s Facebook and Instagram ads and check out with Amazon without leaving the social media apps. As social commerce continues its rapid ascent, it cannot be overstated enough that supplement brands must adapt their digital strategies to fully exploit these emerging customer relationship channels to maintain a competitive edge in this increasingly dynamic business landscape.

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I grew up the typical Rust Belt kid eating mostly a hodgepodge of way-too-sweet, packaged foods and beverages. I’d like to think my “white trash palate” has evolved in the last few decades, but some things are harder to kill than 50 Cent. And you might be asking yourself…what does this have to do with your conversation with the founder of the energy drink brand Gorgie, Michelle Cordeiro Grant? Well…at this past year’s NACS Show, this recovering artificially flavored and sweetened Energy+ drink enthusiast tasted a few naturally sweetened and lightly flavored Energy+ drinks that were great…one of which that left an impact on me was Gorgie. So, naturally I wanted to lean-in further, especially after learning about the founder’s unconventional yet fascinating path to the CPG industry. In our conversation, Michelle explains how that business superpower allowed her to think differently and inspired many key strategic elements within Gorgie. We also breakdown the growing importance woman are playing within the energy drinks market. Plus, take it a step further and explain why it’s the perfect time to apply a much-needed female-first lens to the beverage category. Additionally, Michelle shares important lessons she’s learned in year one building an energy drink brand. Finally, we talk through some untapped exploratory sales channels and what Michelle’s lifestyle branding goals are for Gorgie long-term. But these are just a few of the fascinating topics within our recent conversation…

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Maybe making beer that uses vaginal yeast as one of its key ingredients isn’t going to take off anytime soon, but that doesn’t mean sex no longer sells within the CPG industry. We’ve come a long way from gas station boner pills, as the once-taboo sexual wellness space is booming…with the category now widely available at mainstream retailers. From a CPG strategist point-of-view, this is the time for entrepreneurs to remix sexual wellness products that do not meet modern-day consumers’ expectations. Whether that’s in any of the subcategories from sexual performance to reproductive health, remember that having a great product is only the entry fee to compete in today’s CPG market. Embrace the fact that although more consumers are becoming comfortable discussing these intimate topics, you can enhance your brand experience by helping navigate these difficult conversations and leaning into community building strategies.

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CELSIUS and PepsiCo. Nutrabolt and Keurig Dr Pepper. Bloom and Nutrabolt. NOBULL and TB12. What do these deals have in common (besides the fact that you’ve seen me break each of them down in content on my channel)? The only law firm in the world dedicated exclusively to the CPG community, Giannuzzi Lewendon. While insights from those massive deals are weaved into our conversation, I took the law firm’s partner Ryan Lewendon through my gauntlet of A to Z “CPG land” impactful topics. To be completely honest…this is the type of conversation for those REALLY into the CPG industry. Ryan and I talk about how integral the “divine triad of CPG” is…plus the importance of maximizing strategic optionality by building the brand with intention, both from organizational and customer-facing variables. We also ponder what the future of CPG looks like when its data-driven with layers of artificial intelligence. Moreover, we talk about the good, bad, and ugly around the strategic partnerships involving celebrities and the creator economy. Finally, we take that a step further and talk about today’s kingmakers (algorithms) and why the rise of social commerce has its possible downsides within functional CPG product categories. But these are just a few of the insightful topics within our recent conversation…

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During marathon sessions, gamers are only interested in unhealthy snacks and caffeinated drinks. I mean that was the long-held stereotype, right? Hey…don’t snipe the messenger though, I’m simply attempting to triangulate what the heck Bodybuilding.com is thinking with its recent move! Most functional CPG products do not arrive out of nowhere; they’re remixes of existing ones. And in a few rare cases, remixed CPG product innovations don’t have “easy to understand lineages.” Like when Bodybuilding.com remixes its sports nutrition private label that’s called REMIX Nutrition. Back in August 2020, REMIX Nutrition launched a collection of protein powders with officially licensed Hostess snack flavors like Twinkies, Zingers, and Cupcakes. Now…you guessed it, REMIX Nutrition has been remixed into a gamer-focused supplement line. So, maybe it’s a cheeky way to pay homage to that debunked stereotype?

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Within trendspotting content (when I first started YouTube in 2018), I mentioned how the growing energy drinks market (with all those jolts of stimulation) would eventually lead to a state of overstimulation where consumers would increasingly start shifting more attention towards relaxation. Admittedly, A LOT of my mindshare given to that hypothesis was likely directed towards leveraging a particular trending agricultural ingredient. And this is where synchronicity between Ben Witte (Founder/CEO of Recess) and I likely began. Yet, this phenomenon continued as we both saw the evolving marketplace in a manner that required brands to market the solution, not the ingredient. And I mention all that “separate but intertwined” backstory because our “great minds think alike” dynamic builds extensive layers of insights within our conversation about arguably the next big CPG space. Ben and I will cover how spotting that early marketplace insight helped inform key decisions at Recess that built powerful strategic optionality. We also dive deep into what’s driving the “better for you Relaxation” space and how Recess is intentionally building a broad-reaching platform business within that emerging category that’s inclusive of three distinct product lines, numerous formats, and only slightly nuanced value propositions. Additionally, we breakdown the strategic differences between what is needed to create a new category versus going into an existing category and trying to capture market share. As a special bonus, I got Ben to walk us through his “Recess Flywheel” strategy that has been creating more and more rapid retail growth. But these are just a few of the fascinating topics within our recent conversation…

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Many years ago, when I started proclaiming that the best and brightest sports nutrition brands could compete against any large CPG incumbent when it comes to functional food and beverage…oldhead CPG industry folk (especially beverage people) thought I was crazy. But at this point…I can just let that one super important beverage category retail sales scan data do most the talking for me. Energy drink brands that have roots in the supplement industry now account for over $3 billion in retail sales. And while most know the growth stories of CELSIUS, C4 Energy, GHOST, and Alani Nu, by now…I’m going dig a layer just below those brands and highlight a fast-charging challenger that could soon crack the top 10 best-selling energy drink list. In my wide-reaching conversation with Nic Stella, we cover topics like how his ability to spot early internet content and commerce connections have become a foundational element to the growth behind RYSE and RYSE Fuel. We also talk through a few different strategic partnership strategies…from flavor licensing to sponsoring UFC champions and professional sport teams. Moreover, Nic gets REAL about the beverage business and outlines a growing trend that I’ve long dubbed “the great beverage mirage.” Finally, we talk through his decision to lean into TikTok...which made him a key character in the brand story and catapulted RYSE to the top categorical spot on TikTok Shop. But these are just some of the insightful topics we talked about in this episode...

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CELSIUS and Ferrari. Monster Energy and was Mercedes-AMG for many years but is now with McLaren. And you can’t overlook the current top Formula 1 team…Red Bull. It’s probably hard to imagine now, but there was a time in the early 1990s when there weren’t any energy drinks sponsoring F1 racing teams. Similarly, it’s probably hard to imagine now…but in next thirty years we might be saying the same thing about supplement brands. Now…I’m sure every F1 racing team has some type of product allocation arrangement with certain supplement brands, but that’s rookie-level sports marketing tactics compared to the recent THG and Williams Racing partnership. THG Ingenuity will provide Williams Racing with a broad range of services, including across technology, ecommerce, and sustainability, while Myprotein will assist with nutrition. Will this be the tipping point for the supplement industry to dive deeper into F1?

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Billion-Dollar Vibes Only. But does CELSIUS have what it takes to jump either Red Bull or Monster Energy in the next several years? Celsius has now been fully integrated within the PepsiCo distribution system now for the last year and also fully integrated into PepsiCo’s annual planning cycle. Celsius Holdings (NASDAQ: CELH) had quarterly revenue of $347 million, which was up 95% YoY. More importantly, Celsius Holdings smashed through the billion-dollar mark in its full-year revenue numbers. In 2023, the energy drink brand generated $1.32 billion in revenues…which was up a staggering 102% YoY. According to IRI last 52-week data, Celsius was the number one brand driver of unit and sales growth in the energy drink category. Celsius was responsible for 31% of the category growth, driving $1.09 billion in incremental sales. In addition, according to the trailing 4 weeks of IRI SPINS all tracked channel data for the period ending December 31, 2023, Celsius is now securely the third-largest energy drink brand in the category. Its market share went from 4.9% in the third quarter of last year to 10.5% now. And I don’t want gloss over this accomplishment…because it’s the first time in over a decade that an energy drink not named Red Bull or Monster Energy has had a 10% share in the U.S. market. Celsius energy drinks saw massive growth in convenience stores, foodservice (e.g. fast food restaurants), mass retailers like Walmart, the club channel in retailers like Costco, and the Amazon marketplace. CELSIUS is now the best-selling energy drink on Amazon and also number one energy drink brand on Instacart grocery marketplace. So, it’s safe to say that CELSIUS is the official energy drink of the Internet Generation. Additionally, the early international market development groundwork starting to formalize with CELSIUS forming a new relationship with Suntory Beverage & Food and also saw the first major international market expansion under the PepsiCo umbrella, as sales and distribution activity in Canada began in December 2023. It's my opinion that international expansion presents significant opportunity for incremental growth over the next three to five years. With Celsius at basically full distribution now…the TDP growth will have to come from increased items carried per store. Because while the average items carried per store has increased exponentially since the PepsiCo partnership…it still lags Monster and Red Bull considerably. Going forward, Celsius will increase items per store through a combination of product strategies like flavor expansion, scaling the new Essentials lineup, and reintroducing iterated line extensions like fizz-free. Additionally, they will seek more store placements like leveraging cold display activity in Celsius-branded coolers. Finally, I recall a "called shot" by Celsius Holdings CEO John Fieldly three years ago and explain why I wouldn't bet against his crystal ball predictions as “the energy drink category is now a 3-team race.”

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