Poppi vs Olipop: Soda’s Second Coming | 6

0:08Back in the 2000s, soda became a four letter word. Once people realized just how much of an impact sugary drinks were having on their health, soda pop lost its luster. Full-calorie soda sales dropped 25 % during the early to mid-aughts. But over the past few years, the soda scene has experienced something of a renaissance. The standouts of this movement? Poppy and Olipop. By now, you've probably seen these brands on social media. Their aggressive social marketing strategies have these colorful cans in the hands of practically every influencer. The two companies position themselves as functional or prebiotic sodas claiming to have added health benefits, unlike traditional sodas like Pepsi and Coca-Cola.

0:54And this concept has really popped off. The functional beverage industry is worth an estimated$54 billion in North America alone. Olipop's valuation is nearly$200 million, while Poppy has larger growth than Monster Energy, Gatorade, Liquid Death, and Vitamin Water, according to Forbes. Couple all of this with a rising sober curious movement among millennials and Gen Z, and you've got a recipe that could breathe life back into an industry that's been falling out of favor. Today, we're cracking open cans of both poppy and olipop, somewhat literally, I might add, to understand how these sodas got so popular and find out what's next for soda's second coming.

1:39Stick around.

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3:49From Wondery, I'm David Brown, and this is Poppy vs. Olipop. So does Second Coming.

4:15To understand why this busy renaissance is happening right now, we need to take a quick trip back in time to the origins of soda pop. For centuries, people have turned to soda as a bubbly alternative to plain old water. In fact, soda caught on as far back as 77 AD in Europe, where people discovered naturally carbonated mineral springs that were believed to have healing powers. People thought, oh wow, these are magic waters. We can bathe in them and drink them and we'll become strong and healthy and it will cure all our diseases. Tristan Donovan is the author of Fizz, How Soda Shook Up the World, which chronicles the history of the bubbly beverage.

4:54And so it became this kind of idea that, oh, it wouldn't be great if we could just make this magic water instead of having to travel hundreds of miles to actually get to it. So essentially, humanity had this kind of several hundred years quest to try and make basically what they saw as magic water, which was basically fizzy water. By the 18th century, the quest succeeded as European scientists learn how to carbonate water. But bottling these drinks wasn't the cleanest or most hygienic process. So by the 19th century, soda makers started getting creative. In order to hide any debris that may have been included by accident, they used caramel to darken the color and sugar to mask any unpleasant taste.

5:40It was around this time that a Harvard professor looking to make some extra cash came up with the idea of something called a soda fountain, which rocketed pop to the top of American culture and opened the door for more experimentation. Other people copied that idea. Then some of them started thinking, well, actually, we could offer a range of different flavors, a bit like the syrups you get in modern-day coffee shops. It's like, oh, would you like all soda water with a bit of celery extract in it? And And so really it came out of there, and that's when the explosion of different flavors came about, and it became woven into American life.

6:18Another reason for soda's explosive popularity in the 19th century was the rising temperance movement in the United States. This was essentially the precursor to Prohibition, where drinking alcoholic beverages was seen as morally bankrupt. And to make soda even more appealing to the masses, merchants started promoting it as a kind of antidote for common illnesses. The 1800s were really kind of when soda was promoted as a health drink, and not just because of the temperance movement, but you also had all the sort of snake oil merchants going around, going, I've got a potion that will cure all your illnesses.

6:56And the two kind of intersected. To keep up its reputation as a health drink, Soda makers started adding ingredients that they thought at the time could cure people's ailments and help sell the drinks. Early versions of Coca-Cola even contained cocaine. Cocaine was seen as a wonder drug back in the middle of the 1800s, and it was legal. So these kind of chemists were like, oh, we'll put some cocaine in this drink because it's curative and people will want it. Now, adding cocaine to Coca-Cola didn't last that long, and the practice was in fact banned by 1903. But by then, soda was everywhere. Coca-Cola, Pepsi, Dr.

7:36Pepper had all hit the scene, leaning into their pharmaceutical routes well into the 1950s. Dr. Pepper, the cold weather drink. We say the cold weather drink because Dr. Pepper is a blend of pure fruit flavors with a lemon base. That lemon base tends to alkalize your system and helps keep you away from bad cold. all through the winter month, Christmas Day when all your friends and guests drop in. Give them the drink that's good for life, not only tastes good but is good for them. Dr Pepper, Dr Pepper time starting out now with Fisher's Hornpipe. So if you get back to the 50s and 40s, there's lots of, say, Dr Pepper ads where it's like, we've got loads of sugar in this, it's great.

8:20To people kind of go, maybe all this sugar isn't that good for you. As doctors began to understand the negative effects of sugar on teeth and overall health, soda's advertising started to shift. And soda marketing kind of changed to being more recreational. And particularly during the cola wars, if you look from the 60s through to the 90s, it was about youth and having fun and going out with your friends. And it was nothing to do with health.

8:55The world of steam You heard it on the D &D And I'd like to buy the world a cup And keep it company This famous Coca-Cola ad from 1971 was considered to be one of the greatest commercials of all time. It features a large group of hippies of all different backgrounds singing together holding bottles of Coca-Cola. By tying itself to the counterculture movement of the times, Coca-Cola was able to rebrand for a younger generation of consumers. The health concerns hadn't disappeared, however, and by the 1980s, the diet soda craze began. Coca-Cola finally came out with Diet Coke, and that was really kind of the big turning point where suddenly, oh wow, there's like proper diet sodas.

9:46I mean, they'd been around, but somehow there was something about the marketing of Diet Coke that really just got it over the line. And suddenly it's like, oh, I'm going to stop drinking Coke and have Diet Coke instead. And then pretty much everything followed. You know, it's like, oh, now there's Diet Dr. Pepper, there's Diet Fanta, there's Diet everything. Things were looking great for big soda. By 1998, soda sales had peaked, with customers drinking 53 gallons per capita in the United States. Little did they know all that success was about to flatten out. You had people and campaign groups starting to go, you've got to stop drinking all this.

10:27This stuff is just liquid candy. And that really kind of hit home. I think, you know, these things always take years. You know, it's like turning around a super tanker or something. But it really, by the end of the 90s, the message had broken through. And people were like, actually, this is not good for you. Fast forward to 2016 and soda consumption was at a 31-year low, with bottled water outselling the former pop stars. Several cities including San Francisco, Boulder and Philadelphia introduced taxes on sugar-sweetened beverages. The beverage industry was at a crossroads, forced to figure out how it could stay relevant among a consumer base that just wasn't buying the sugary drinks of yesteryear.

11:11Soda sales have fizzled about 14 % in the past decade, but cola companies are making moves to turn things around. Consumers are ditching sugary drinks for healthier alternatives, or as soda companies put it, code red. With consumption falling flat, the soda market was left with a gaping hole. So the big companies entered into full acquisition mode to try and fill it. In 2016, Pepsi bought Kavita Kombucha, and Dr. Pepper's Snapple Group bought the flavored water called Bi, which claims to be full of antioxidants. And also that year, at farmer's markets in and around Dallas, Texas, husband and wife duo Stephen and Allison Ellsworth were introducing an apple cider vinegar-based health drink called Mother Beverage.

11:59Apple cider vinegar, I mean, it's just been around forever to help with health. and, you know, to promote wellness. So it's just, you know, a brand to taste good, be healthy, but, you know, it's a refreshing beverage too. You don't just have to drink it to be, you know, healthy. That's the founder, Allison Ellsworth, speaking at an event for the beverage industry publication BevNet back in 2016. She began experimenting with apple cider vinegar while traveling for work. She found herself constantly feeling sick and run down and had read online that the stuff might help. Here she is in a recent interview with the Today Show.

12:35So I started drinking apple cider vinegar every single day for about two weeks, and I felt so much better. I was like, how can I make a better-for-you soda that's all clean ingredients? So I went to my kitchen, and I just started experimenting. Allison and Stephen got an investment of$125 ,000 from family and friends to bottle and sell their experimental soda. In 2016, Mother Beverage was discovered by Whole Foods and began selling in select locations to the tune of half a million dollars in sales. Then in 2018, the outlook for the company and the couple's future changed dramatically. A nine-months-pregnant Allison appeared alongside Stephen to pitch investors on Shark Tank.

13:20Hi, Sharks. I'm Allison Ellsworth. And I'm Stephen Ellsworth. And together, we're the co-founders of Mother Beverage based in Dallas, Texas. We're here seeking$400 ,000 in exchange for 10 % equity in our company. All right, sharks, who wants to take a shot with me? So as you guys know by now, that was a shot of apple cider vinegar. Oh my God. Well, I started drinking apple cider vinegar or ACV to detox and lose weight. There were a whole bunch of no's from the other sharks, but they did get one yes. Rohan Oza invested$400 ,000 for a 25 % stake in the company. Oza has a background in the beverage industry.

13:59He helped develop vitamin water and then developed and sold the drink Bi. In 2020, Mother Beverage relaunched with a new name, Poppy, a play off of soda pop after realizing they couldn't trademark Mother and they needed something a little catchier. But Poppy wasn't the only hot new bubbly drink hitting the market during soda's identity crisis of the 2010s. While Allison and her husband Stephen were infusing apple cider vinegar at Dallas Farmer's Markets, beverage industry veterans Ben Goodwin and David Lester were concocting their own good-for-your-gut drink inspired by kombucha. We are Ovi Probiotic Soda, and we've grown a ton since we first started with Newly.

14:43That's Ben Goodwin in a promotional video for an independent grocery store from 2015. The probiotic pop wasn't quite catching on at the time, so Ben and David decided to sell it in 2016. They earned$100 ,000 from that sale, which they used to start a new brand of gut-friendly soda. Meet Olipop, a new kind of soda. Naturally sweet, nothing fake, supports digestive health. Delicious soda that's actually good for you? Yes, please. In 2018, Olipop was born, the same year Allison and Stephen Ellsworth pitched Poppy to Shark Tank. Now, unlike Poppy, Olipop doesn't contain apple cider vinegar. Instead, its cans have fruit juice as well as a blend of botanicals, plant fibers, and prebiotics.

15:35And like Poppy, it derives its name from a reference to pop, Midwestern slang for soda, combined with oligosaccharides, a.k.a. prebiotic fibers, On a podcast from a couple of years ago, Goodwin shared that Olipop's ultimate goal was to win over fans of traditional soda. The priority at the end of the day is the soda drinker, right? It's because it's the biggest bucket. It's where the most kind of harm mitigation opportunity lies. However, like everything else, you've got to earn your stripes. You've got to earn your way there. So that's why we started in the natural channel, which is typically a more early adopter consumer.

16:15By 2019, the company raised$2.5 million in seed funding. Olipop then gained its own bevy of celebrity fans, raising$39.7 million in 2022. Here's Olipop co-founder David Lester talking about their partnership with singer Camila Cabello. Got put in touch with her because she was drinking the product itself. And she spoke really passionately about and was really interested to partner with us. Six years later, these brands have more than caught on. But are they just the flashy, dare I say, buzzy new option? Or do they have real staying power? When we come back, we're pulling tabs on our very own test kitchen.

16:59If you'll pardon me for just a moment, I'm going to pick pop the lid on a couple of these. Stick around.

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18:44Welcome back to Business Wars. We've been talking about the two biggest competitors in the functional soda wars, Poppy and Olipop. Both brands have strong distribution channels right now. You can find them at big box stores and grocery stores nationwide. The drinks seem to be pretty similar, though. The packaging is colorful and playful, with both advertising digestive health benefits right on the can. Ann Guillen is a retail reporter for the information who's written about both brands. I asked her if similarities would come back to bite one of them. Now, Poppy and Olipop use different ingredients, but they might seem very similar to the average consumer.

19:24I know that if you're shopping for them at the grocery store, you'll find them in the same section. Has that similarity been a problem for the brands? I don't think the similarity has necessarily been a problem for them yet. I think the fact that both of these brands have been able to grow so quickly, I think, really demonstrates that there is a lot of interest in this kind of product. Obviously, they're so similar, you kind of can't help but compare them. But I don't think, you know, one has grown at the expense of the other at this point. Well, when you have two good-for-your-gut beverages with similar marketing and social media hype, there's only one way to really sniff out the differences between the two.

20:09Or should I say, sip. Well, now I mentioned that I saw these in the store, and so I couldn't help but pick a couple of these up just to give them a try myself. And I know this is non-scientific. But if you don't mind, if you'll pardon me for just a moment, I'm going to pop the lid on a couple of these. I decided to orchestrate my very own taste test with Ann Guillen as my witness. Okay, this is the Ollipop ginger ale. It says here 50 calories. Trying to make out here only 17 grams of carbs. Watch out for that. Five grams of sugar. And this is the ginger ale flavor. And I have to say, I saw a bunch of different flavors, and the ginger ale just kind of seemed the safest.

20:56So here we go.

21:02It's a good flavor. It's a very good flavor, Olipop. But it's not as tangy or tart as I was expecting from a ginger ale. I will say that. But it goes down really smooth. It's like a, I was going to say like a flat can of dry, but that's not fair. It's a very smooth tasting ginger ale. For the record, David, ginger ale is my favorite olipop flavor. Oh, is that right? So I picked good. I would say you made a good choice. Oh, very good. Very good. All right, well, let's try this one now. This is the poppy. This is the locally grown for me since I'm in Texas. Here we go. This is, oh, this is wild berry.

21:4316 ounce.

21:47Boy, a lot of fizz there. A lot of fizz.

21:54Wow, very flavorful. That's very flavorful indeed. This says it has 30 calories. Carbs are about eight. So about around half what the other was. What did I say the other? They're both very good. They're both very flavorful. One is a little bit fizzier than the other. Was that your take? I presume you've tried this poppy as well? I have tried both. I have tried Olipop and Poppy. And I actually maybe am a bad test subject because my favorite thing is sparkling water. And to me, what makes a good sparkling water is if it has a lot of fizz. So I would say that both Olipop and Poppy don't have quite as much fizz as I personally would like.

22:45But I think they get very close. Mm-hmm. For a drink with only about five grams of sugar per can, it's pretty tasty. It's also non-caffeinated, which is appealing to folks who want the fizz but not the buzz. This, Ann says, is what will keep customers coming back for more. People are looking for another beverage that, you know, it kind of satisfies that craving for, I want a sweet, fizzy beverage, but I want one that, you know, where I can drink one every day, where I wouldn't necessarily drink Coca-Cola or a Sprite every day because it has a lot of sugar or I don't want to have that much caffeine.

23:26So I think that the digestive or the gut health benefits might not be what kind of draws every single new shopper in. I think that a lot of people are looking for an alternative that is probably a little bit healthier for them than the options that have been out there previously. And something that they can feel good about having on a more frequent basis than maybe they feel like sodas only every once in a while or something that they can't have every day. And that idea, a sort of rebranding of soda, is exactly what these companies are trying to communicate in their advertising. Here's a recent ad from Olipop.

24:09Delicious soda that's actually good for you. Anything else is a compromise. Olipop, a new kind of soda. And here's an ad from Poppy that aired during the 2024 Super Bowl. This will be the last moment you ever think of soda as being a dirty word. Soda! As being bad for you. filled with unclean ingredients and unnecessary sugar. Because this is Poppy. This Poppy ad came with a nearly$7 million price tag and reached more than 29 million viewers. Anne Guillen explains the significance behind the costly commercial. Poppy, by doing the Super Bowl ad, I think it's an indication that they're in a kind of interesting point in their growth where they're really trying to go reach a national audience and not just this niche health-conscious consumer.

25:01You know, what is going to make the difference if there's a can of Olipop and a can of Poppy right next to each other in the fridge at the grocery store? What is going to make you pick one over the other? And you're likely to pick the brand where you saw their ad on your way into the store or you saw their TV commercial. And so I think they both have had to invest in a lot of this kind of brand building and brand awareness so that when they are right next to each other on the shelf, you feel inclined to pick one over the other. Anne also points out that while Olipop and Poppy have the look and feel of other direct-to-consumer brands, they're really doubling down on this more traditional advertising strategy.