During the last piece of Celsius Holdings content, I asked “what happens after you get to the moon”, which was a reference to passing the $100 million sales mark that’s elusive for energy drink brands that don't also have a national distribution contract or share a cap table with one of the five large beverage portfolios. At $50 million in 21Q1 net sales ($200 million run rate), I guess they have their sights set on reaching Mars to complete this space exploration analogy. Within the larger retail and distribution performance, I breakout three specific channels for different reasons that show why Celsius Holdings should have a lot of runway left to grow for many years in the energy drinks market. Celsius Holdings has proved over the last 15 months that it can compete on the same level with the big players in the energy drink space. It’s strengthened distribution channels combined and increased market awareness has positioned Celsius to take even more market share away from mainstream competitors. What’s next will be interesting for the brand, as they could grow organically to $250M in revenue over 2021, but still be at a crossroads that could see themselves readying for the sell-side of an M&A deal.

Did Glanbia Performance Nutrition benefit from pent-up global demand or is something else at play here? Glanbia Performance Nutrition 21Q1 net revenues increased 17.6% YoY on a like-for-like basis from both strong pricing and volume increases. While that growth is extremely strong, leadership did note on the earnings call that about one-third of the consumption growth can be attributed to inventory builds with retailers. As part of the Glanbia Performance Nutrition transformation program, the company again adjusted the organizational and reporting structure. Instead of the recently instituted “Lifestyle”, “Sports Nutrition” and "International/DTC", it will now be "Americas" and "International" only. That being said, Glanbia Performance Nutrition hired two new leadership positions; Chief Growth Officer (focuses by brand) and Chief Commercialization Officer (focuses on channels). Additionally, with almost three-fourths of Glanbia Performance Nutrition revenue is now made up of Optimum Nutrition and Slim Fast. Even with increased advertising spend on both brands planned through the entire 2021, I do think these brands have different 5-year trajectories though, and outside of increased CAPEX spending, Glanbia will need to utilize it's strengthened balance sheet to be more aggressive with M&A. We've yet to see any deals yet from Glanbia Performance Nutrition side while competitors have been gobbling up prime targets.

While the “COVID-19 Effect” challenged Glanbia in 2020, the well-timed transformation plan and improving environment around long-term secular trends should make the company stronger for the future. That being said, problems still lie on recalibrating the GPN brand portfolio and one they will have to address head-on in the next year if they want to sustain their market leadership against large CPG portfolios like Nestle.

Positive in-store (and digital) same store comps will attract a larger pool of interested franchisees and the “COVID-19 Effect” lingering further only strengthens the consumer behavioral pattern around prioritizing all things health and wellness. This combination makes The Vitamin Shoppe potentially very attractive for prospective franchisees. With a run rate of almost $1.2 billion, the specialty supplement retailer would be back to the 2014-2016 height of company (from a revenue perspective). This is no small feat and should be getting more attention than it does because they would be achieving it with a smaller store fleet. While it hasn’t been the flashiest turnaround, the Vitamin Shoppe has quietly been putting in the required work in the gym to now be able to flex its bigger muscles in the market.

Bellring Brands (NYSE: BRBR) growth storm has further strengthened from the recent performance of Dymatize Nutrition, but what takes the active nutrition brand portfolio to the next level? BellRing Brands is a portfolio that owns a collection of convenient nutrition brands like Premier Protein, Dymatize Nutrition, Powerbar, Joint Juice, and Supreme Protein (recently shuttered), which was previously wholly-owned by Post Holdings. A fast-paced and busy lifestyle is pushing consumers to switch to quick and healthy meal options. This has resulted in the increased household penetration of RTD protein shakes that promote active lifestyles. In this latest podcast episode, I'll utilize the recent BellRing Brands earnings report, earnings call, and publicly disclosed news as the backdrop to discuss what it could mean to the overall active nutrition market in the liquids, powders, and bars formats. Because Premier Protein makes up 84% of the portfolio’s total revenue, I’ll dive deeper into that brand, but also provide more commentary on the turnaround story that's happening at Dymatize Nutrition. Finally, I run through the four strategic pillars of Bellring Brands that will unlock organic growth. Only time will tell how this plays out, but Bellring Brands will certainly be an interesting name to pay close attention to in the near-term.

Today’s consumers are increasingly wanting more than simple products. The value they are looking for comes from experiencing the use of a product that is tailored to their specific needs and preferences. Delivering such experiences often requires complex and integrated systems that can no longer satisfied by functional CPG brands only offering “off the rack” products without additional value creating ecosystems. That being said, is it time for your functional CPG brand to deploy an ecosystem strategy? Any functional CPG brand undertaking this level of strategic shift must remember that discovering new customer value through ecosystems is a process (not a project). Most successful ecosystems started with a broad idea of where the potential for new value might lie, and only after learning through customer feedback loops and embracing an iterative innovation mindset does a winning combination emerge. Ecosystems that are successful in the long run need to be adaptable and be ready to modify their designs in anticipation of shifts in markets, technologies, regulations, and public sentiment. Designing an ecosystem is a major undertaking, but one that’s well-designed has the potential to create entire new industries or substantially shape and transform existing industries.

To help explain ecosystem strategies better, I'll utilize three diverse case studies from functional CPG brands already deploying them in the market; Proper Sleep, Nestle, and Revive MD. 

Increased transparency is great for every supplement industry stakeholder, right? Ask any key leader within the supplement industry and they will mention that there’s a clear connection between increased transparency and consumer trust. As more consumers add supplements into their daily routine, it’s imperative every player within the value-chain embrace a greater level of transparency to ensure that only high-quality supplements enter the market in order to reduce risk to consumers. While transparency is an evolutionary standard, the brand side of the supplement industry has mostly obliged with this consumer demand for more information. That being said, supplement brands will start demanding more from the supplyside (ie. ingredient suppliers, flavor companies, and contract manufacturers) that eventually turns transparency into full blown traceability. Without a doubt, the supplyside will respond and eventually provide “full traceability”, but what happens next might catch them those supplyside companies off guard!

Even before it’s announcement to buy The Bountiful Company, Nestle was quietly becoming one of most important players (if not the most important player) in the supplement industry. If you haven’t heard by now, Nestle agreed to buy a collection of brands from VMS portfolio The Bountiful Company for $5.75 billion. I believe this M&A activity has huge short-term and long-term implications for the entire supplement industry. In the short-term, supplement companies will have to contend with a new powerhouse that will seek to gain pricing power and additional market share. In the long-term, Nestle has the upper-hand right now on a larger portion of the personalization equation that will define the CPG industry of the future. While “scraps” will always fall from the table of giants to feed a group of peasants below, an increasingly competitive market will force many sports/active nutrition and VMS brands to adapt or die.

How can the first fitness influencer in history help us anticipate the future of influencer marketing? What’s happening today is not new, with most being remixed strategies and methods from years, decades, and even sometimes centuries past. Recently, I was reading an Economist article that made me ponder the trend of fitness influencers. If asked when did fitness influencers start, you might say person XYZ from Facebook, Instagram, YouTube, or Web 1.0 Internet forums or blogs. If you’re a bit older you might say Arnold Schwarzenegger, but what if I told you the “first fitness influencer” came to relevance in the late 1890s. For my bodybuilding fans, you will recognize the name as he’s immortalized with being the trophy given to the annual Mr. Olympia. Though other Victorian strongmen faded from memory, Eugen Sandow remains a household name in the fitness industry. Why are these lessons from Eugen Sandow so important now?

After a year-long delay stemming from the “COVID-19 Effect”, The Vitamin Shoppe finally opened itself up to a refranchising process. As many of my followers know, I’ve said The Vitamin Shoppe would move to a franchise model since their acquisition announcement in August of 2019. The franchise disclosure documents should have been ready in 2020, but the “COVID-19 Effect” created an uncertain business environment where it was better to dig in and execute on existing plans without rocking the boat. Now that we have publicly disclosed information and interested parties can apply to be a franchisee, I wanted to provide you with an overview of those details, discuss how they compare to their biggest competitor GNC, explain why this refranchising is happening, and most importantly discuss what’s could be coming next at The Vitamin Shoppe.

I’ve always believed that Hip Hop and CPG entrepreneurship are linked together. Firstly, Hip Hop is seen as counterculture to other music genres, which is similar to CPG entrepreneurship in today’s “technology” filled founder landscape. Additionally, Hip Hop and CPG entrepreneurship are both centered around being salesmanship and the ability to hustle. Moreover, Hip Hop music is rooted in remixing (or sampling) previous music, and this iterative innovation process is also core to the CPG industry. Finally, Hip Hop is more than music, it's a cultural lifestyle...which anyone in the CPG industry knows it functions in the exact same way. This is probably why you see so many hip-hop artists that are involved with CPG entrepreneurship (or investing). Unfortunately, we never got to see if Notorious B.I.G. would have made this list before his untimely death, but he did provide us hints likely would have been a great CPG entrepreneur. So, what can you learn from the hip-hop legend?