Summary List Placement
In less than a decade, Zico coconut water went from one of the fastest-growing upstart beverage brands to one of hundreds Coca-Cola decided to relegate to the history books.
At least, that was its trajectory until Mark Rampolla read about the beverage giant’s reported plans to kick the brand as part of a culling of its portfolio last October.
“I immediately reached out to my contacts at Coke and asked them if it was true, and I let them know that we as PowerPlant might be interested,” he told Insider in an interview.
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Rampolla had founded the coconut water brand in 2004. By 2013, Zico had helped make the coconut water mainstream, racking up sales and touting it as a healthy alternative to traditional soft drinks. Toward the end of that year, Coca-Cola acquired Zico in full after taking a minority stake for $15 million in 2009. Rampolla ultimately moved on to other projects.
Now a co-founder and managing director at PowerPlant Ventures, which invests in food and beverage companies, Rampolla huddled with his team to see whether they might acquire the company he helped found. Eventually, they made a bid, and Coke agreed to sell the company to PowerPlant. Rampolla did not disclose the price PowerPlant paid for Zico.
A Coca-Cola spokesperson did not say whether the beverage giant had considered selling Zico before confirming plans to phase the brand out in October. The spokesperson said that Coca-Cola “made the decision to shift our priorities away from Zico and focus on brands we can expand globally.”
“We are incredibly proud of the work we achieved growing Zico when it was a part of The Coca-Cola family of brands and wish PowerPlant Ventures continued success as they take the Zico brand on a new journey,” the spokesperson said.
‘I’m surprised that Coke has not done a better job at distribution’
Under the deal, PowerPlant will acquire “the brand, not the business” of Zico, Rampolla said.
The new entity, called Zico Rising, will re-establish relationships with retailers and other customers that sell Zico. “We are in the midst of rebuilding everything from scratch, but with a running start,” he said, adding that the ownership transition should be “almost completely seamless for consumers and for retailers.”
Coca-Cola attributed its initial decision to phase out Zico to a broader reorganization of the company, which has also involved getting rid of smaller brands like Tab or Delaware Punch. But Rampolla, who left the brand shortly after its sale to the Atlanta-based soda maker, pointed to challenges within Coke’s division for emerging brands as well as some strategic decisions as reasons why Zico didn’t meet expectations.
Leadership at Cocoa-Cola’s Venturing and Emerging Brands unit, which the company says works with up-and-coming brands “with a billion-dollar potential,” has changed frequently in the time since Zico joined the company.
“That’s difficult,” he added. “Having consistent …read more
Source:: Business Insider