Red Bull vs. Kroger Is Bigger Than Energy Drinks

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0:37Mike Schneider:Hello, and thanks for tuning in to Taste Radio, the number one podcast for anyone building a business in food or beverage. I'm Ray Lateef, the editor and producer of Taste Radio, and it was my co-host for this episode, Melissa Travers and Mike Schneider. Kroger is drawing a line on the sand on pricing, and some familiar brands are disappearing from its shelves. We recap Taste Radio's San Francisco meetup before digging into the supermarket giant's standoff with Red Bull, which has halted shipments of the energy drink and the disappearance of Boar's Head products from some of its stores. We also clarify what's happening with Hoplark following its Chapter 7 filing and unpack what these developments reveal about the increasingly tense dynamic between retailers, suppliers, and consumers in a pressured CPG environment.

1:28Mike Schneider:I'll be honest, I love San Francisco and I'm kind of sad that we didn't have more time there. We had a fantastic meetup at the San Francisco Brewing Company and we saw so many fantastic people from the Bay Area and it just felt like I needed another day or two to absorb the city and its incredible people, including those that came to our event. I needed to drink a lot more soupies. or eat a lot more Soupies and hang out with just incredible founders there. Drink more Golden Disco. Eat more Nutty Hazel. Have some calligraphy wine. I even had some calligraphy wine. That is huge. Yeah, it was really tasty.

2:09Yeah, you never drink. I mean, when a founder asks me if I'll try their product, then I'll tend to do it. That Soupies, it was the soup with, I think it was ground turkey, daikon and seaweed. That was exactly what I wanted to eat after being on a plane all day. And anchovy broth. Oh, no wonder. Yeah, that's why it went right into your soul. No wonder. Fantastic stuff. It was good to see Jules Reyes from Mindful Drops and a secret tea project. Oh, you know, actually, that was one of my favorite items of the meetup. It's a squeeze bottle that has L-theanine drops in it, and you squeeze it right into your coffee.

2:44And I've been using this, and I love it. I'm a big fan of L-theanine and coffee anyways. I've heard it described by psychopharmacologists as sort of like a replacement for if you're on an ADHD med, this could, you know, I'm not a doctor. I'm not prescribing anything. I'm just saying. Do you know what this makes healthy eating? The interesting ingredient of the week. No, no, it's not even. I have another one. There's going to be two. Yeah. Yeah. The San Francisco meetup was rich in interesting ingredients. We also got to see YC from Hero Bread. Love that guy. He also brought the people who formulated his fantastic shortbread cookies.

3:22And he brought the shortbread cookies and those little pretzel bites. And right next to the hero biscuits was Nutty Hazel with their stir-free hazelnut spread. And you put those together and I did. And I was like, it was like, I found the entire Triforce. I was like, Lincoln, Legend of Zelda. I won the meetup. You saw me. I saw you. Did you see me glowing? I saw you glowing, but I don't know if I can say that you won the meetup because I feel like I also won the meetup. There are two winners? Yeah. I found not one, but two interesting ingredients of the week. The second one was with Nutty Hazel.

3:57So they use rice bran butter, which I had not seen before. So it's stir free. It doesn't separate. Rice bran butter is an upcycled ingredient. and Katie, the founder, said that it gives the product the texture of palm oil and helps the chocolate hazelnut butter not separate. And I haven't seen that before. So many great brands are there. We just got on a tangent, Ray. Sorry about that.

4:21Mike Schneider:No, it's okay. I'm just, you know, I'm trying to reminisce on the brands and people that I saw at the meetup as well. Great to see Michael Fisher. Michael Fisher from Rotten, who we also had on stage speaking. Mark Gallo from Mana Beverages. He was there. Pete Grego, an industry legend. Industry legend Pete Grego. Yes. The folks from Golden Disco were there. They were there to the bitter end. Bakeful was there. Love those people. Thanks for the support. And Golden Disco. Yeah. Tony Davis, the founder and CEO of Bakeful, which is such a remarkable brand. It is the kind of brand that we all hope for.

4:54Mike Schneider:And here it is with us. I think I described it on stage as current nostalgia, right? So it's a brand for modern times, but just soaked in nostalgia. Imagine all the Hostess cakes and pastries that you ate growing up, but in a much better for you form. That's Bakeful. And they have three different lines of products, including muffin full, brownie full, and donut full. The donuts. Those were the best. I have a weakness for donuts. Me too. And the donut full, bake full products are just spectacular. They were frosted in just the right way. We also saw Stephanie, is it Howie? I think it's pronounced Hottie, but I've never actually asked her.

5:32Mike Schneider:Hottie? Yes, but regardless, Stephanie is one of the most incredible people in our business. So supportive of early stage founders, so supportive of minority founders. And she is just someone who is a champion for early stage entrepreneurs and their products. It's just fantastic. She brought you stuff. I have what she brought me in my hand. I have the San Diego bar. So it is an energy bar that has coffee and a small amount of caffeine in it. And then she also brought me Mammoth Bars. These are raw protein bars. Those are so good. Are they so good? I haven't tried them yet. I'm so excited to try, especially the macadamia coconut.

6:10But Stephanie is the best because you always know you're going to get and try amazing things. I was this close to being able to try. Like she said, oh, I brought you guys this stuff. I do. I want you to try them though, too. I mean, I've tried them before. Mammoth Bars are fantastic. Cashew cinnamon or goji berry? Because I want the coconut. Yeah. All right. Thank you.

6:27Mike Schneider:Yeah, Stephanie has been working with Whole Foods for some time. She's based in the Bay Area. And if you haven't met her yet, connect with her on Instagram or LinkedIn. She's just, like I said, she's just the best. She also had Philosopher Foods raw stone ground pistachio butter, which I couldn't take back with me because I was flying the next day. But I haven't seen that anywhere. I'm so excited about it. Did you know that pistachios are one of the few tree nuts that are a complete protein because of their amino acid profile? Oh, interesting. I just saw that on that. Which makes them one of the interesting ingredients.

7:03Three interesting ingredients? Come on, man. Crazy. I'm done. I'm going home. Stephanie, by the way, is H-A-U-G-H-E-Y, for those of you who are trying to find it. Because we didn't know how to pronounce it, and you won't either.

7:14Mike Schneider:And I think I used a T to pronounce her last name, which is not correct. But anywho, you'll find her. Oh, he's Mammoth Bars? They're good. Obviously, a huge thanks to Josh Levy and his team at San Francisco Brewing Company. I mentioned Michael Fisher from Rotten, YC from Hero, Tony Davis from Bakeful. Vibrant Ingredients, Belay, and the Angel Group. Thank you so much for your support. Yes, absolutely. Our partners, our national partners for the meetups have been so critical to hosting these events. Again, Vibrant Ingredients, Belay and the Angel Group. And Bakeful was a great local sponsor for the event as well.

7:49Mike Schneider:Thank you all for helping us turn these events into something that's really special. Like we saw in many other cities, people are clamoring for these community meetups. People want to see each other, connect with each other, talk about the wins, the struggles. They want to meet investors. They want to meet people in the retail business. And people stuck around a lot longer than I expected they would. You know, San Francisco is a busy city. It was on a Thursday night. I assume people had plans, but people were there to the very, very end and then beyond. Everyone was pretty happy that there was an event like that in town and that they had a chance to be there and connect with each other.

8:29It was the networking was electric. Yeah. And I want to point out that no matter how early stage you are, it's never too early to come to one of these meetups. We had folks who had a product that they hadn't even packaged yet. super new Aloha, the molasses beverage that we saw there, I thought was so interesting. That's really good. It was really tasty. It was in a form factor that I wasn't expecting. It was like a tiny plastic bottle. I thought it was soy sauce at first. And then I just told everybody it's soda because this business is so hard and you look at something and you see it, you get a second to get somebody's attention.

9:04And I get that she was sampling, but still like it's one of those things where you're like, what is that? Yeah. So to that point, no matter how early stage you are, it's never too early to come to one of these meetups. And you know, that product, Loha, the molasses beverage, addressed a need that I haven't seen in CPG before, which is iron deficiency because iron supplements can really ruin your stomach. So I thought that was really interesting.

9:26Mike Schneider:Nice, yeah. One more big thank you to Adrian Hahn from Big Dopamine PR, who has been a big champion of these meetups and helped us secure a location at San Francisco Brewing Company, a place I'd like to go back to sometime in the near future. Perhaps in January when the Winter Fancy Fair is being held in San Francisco. Can I shout out Brigitte Coleman? She was my event buddy. Tried all this stuff together and gave me her opinion on it from beyond brands. I mean, she had some really good perspective. I love Brigitte. Yes. One more meetup coming up this year. One more big one. One more. Oh, yeah.

10:03You might need a passport for this one.

10:04Mike Schneider:This one's happening across the pond in London. October 21st in Notting Hill at the offices of Trip. We will be there from 5 to 7.30 p.m. We want to see you there as well. If you're based in the London area or really anywhere in Europe or are visiting the area, you've got to sign up. Tasteradio.com slash meetups. Yeah, it's a good reason to take a trip to Europe. I think the Golden Disco team was saying that they might just hop over. Are you serious? Yeah, yeah. Well, there's a story behind that. Well, yes, yes. She's always got a story. That's the reason she was in Chicago. Her family lives there.

10:40But that'd be so cool. We've seen a lot of Golden Disco lately. I'd like to see more.

10:45Mike Schneider:I would like to see more folks at our meetups. And I would love to see everyone. And I mean everyone. Me too. I know what you're going to say. BevNet Live, Knox Live, and BrewBound Live, all which are happening this December. It's just one of these times where you're probably wondering to yourself, how do I evaluate this year and think about my plans for 2027. And these events are fantastic opportunities to enhance your strategy for, again, the end of this year and 2027. So prepare yourself by meeting the investors, the retail buyers, the consultants, the operators, the service and supplier partners that you'll be meeting at all these events.

11:30Mike Schneider:You wanna register now because you wanna secure your place. not only at the hotel, if you want to stay at the hotel, but we want to make sure that you have an opportunity to fully understand what you're getting into, create a schedule and a plan for yourself to make the most out of the events. There are so many brands who have told me that they found a big retailer or a primary investor at BevNet Live or Nosh Live. And sure, it might happen during a one-to-one, but it also might happen in the elevator. It might happen at the after party. It might happen anywhere. And it may not even be that you meet the investor.

12:05It may be that you meet the person who introduces you to the investor. So there's so much opportunity there. And that's another set of events that you can never be too early. Even if you're thinking about starting a CPG brand, it's a great event to attend to help you avoid really costly mistakes right out of the gates. Or if you've been around for 15 years, then that's a great time to come too. You're thinking of your next round of innovation and you need to validate it or you want to see what's going on in the industry and pressure test what you're thinking about for next year. It's just a fantastic place to go to be able to do all of those things.

12:41And then also just make those personal connections that you can't make by sitting in front of JetGPT and typing some stuff in and getting a bunch of AI slot back. Right. If you're raising money, if you're thinking about raising money, it's a no brainer.

12:54Mike Schneider:Come see us. And we just announced a new slate of folks that will be available for our one-to-one meetings, including three folks from Whole Foods. Those people are Sammy Kiefer, who's a category merchant, Candice Ternus, who's also a category merchant, and the incredible Samantha Fletcher, a senior category merchant. We'll also have Austin Hinkle, who's a category manager for coffee, tea, and energy drinks for INFRA. INFRA stands for Independent Natural Food Retails Association. and Stephen Jabbour, who is the Chief Sales and Operating Officer for Specs. These people will all be there for meetings, available for meetings at BevNet Live.

13:36Mike Schneider:This is brass tacks foundational kind of stuff. You meet this person, they give you a little bit of feedback on your brand, your idea, you follow up, and hopefully all that turns into your products on shelf at Whole Foods, Specs, or independent retailers across the country. You know, it would make me really happy if Sammy Kiefer oversaw the dairy category. What? Oh, my goodness. Oh, wow. Okay. That took me two seconds. But Melissa with the dad jokes. Oh, thank you. Love it. Wow. That one threw me for a loop. Well done, Melissa. So good. Hey, listeners. This September 10th roundup brings jobs at cpgjobs.com from Barrel RM, Revolution Brewing LLC, and Good to Grow.

14:25Harkin Sweets, Russian River Brewing Company, and Trade Turbine keep it rolling. Check opportunities and apply today. Need great people? Put your opening before category pros following the industry. Reach operators, sales leaders, supply chain pros, and retail buyers spending more time with candidates and less on mismatches. At cpgjobs.com, post your opening. Use code TASTERADIO26 and save on the listing. Your inbox should reflect the parts of CPG that matter to you. Choose from BevNet's seven free newsletters covering beverage, food, beer, spirits, careers, education, and more. Sign up and select your favorites at cpgmedia.com slash newsletter.

15:12Mike Schneider:Hasn't been announced yet, but I hope and expect that we'll see some folks from Kroger as well. For those of you in the Midwest, Crochet. Crochet, yes. Crochet's been in the news quite a bit. Quite a bit. Over the last couple of weeks. And a big reason why is because they're standing their ground on pricing as it relates to some pretty prominent brands, including Red Bull and Boar's Head. Melissa, what's going on here? It's a big deal. So Kroger, and this is 2 ,700 stores underneath all of the Kroger banners. Kroger is pulling Red Bull from their energy drink set over a pricing dispute. So Red Bull hiked their prices for the third time in four years.

15:56They also allegedly cut their trade spend by 43%. Yep. So they've been pulled. Trying to do both. Yeah, man. They've been pulled from the energy set. And in that article on Nosh.com and BevNet.com, it was reported that other brands like C4, Ghost, Monster, Alani are all taking up the space that Red Bull left. Kroger is also bringing back Bucked Up and Reign. So lots of opportunity for other brands. And this is a big move. We haven't seen a move like this since Costco and Coca-Cola in 2009. Like that's the biggest one we've seen in the U.S. Yeah. And they made a pledge to cut prices back in May in order to retain that customer base.

16:47And they're really drawing a line in the sand here.

16:51Mike Schneider:Separately, Kroger has removed Boar's Head deli meats and cheeses from several of its stores in regional markets, including Ohio, Kentucky and Indiana. So Kroger is moving its Murray's house brand into some of the spots where Boar's head was. Kroger's CEO, Greg Foran, alluded to the fact that Kroger's private label items may move into spots where they're seeing brands be overpriced. that instead of selling items that they see as being overpriced that are branded, they will move their private label products in there. And I also want to point out, you should go to nonbase.com because I have a fantastic podcast on the ins and outs of private label, everything you need to know by Derek Brawley.

17:42So nonbase.com slash podcast, because private label is something everyone needs to understand right now. This is a huge, a huge thing for the industry. and you look at it as, okay, is Kroger going to lose consumers because people go to Kroger just to get their Red Bull? They're going to lose some, obviously that's going to happen, but there's going to be a lot more industry pressure that we're not even talking about from co-packers, distributors. There are so many logistical changes and money being lost everywhere on this Red Bull thing.

18:12Mike Schneider:I wonder because this is one of those cases where you have an iconic, immense brand in Red Bull but you also have an iconic immense brand in Kroger. And it's almost like the, what is it? The unstoppable force versus the immovable object. And what we're seeing, I think, and no stain on Red Bull, an incredible company, but I think we're kind of seeing Kroger win here because there are alternatives. You mentioned quite a few, Melissa. And I wonder how many people are such Red Bull enthusiasts that they're going to say, I won't drink anything else but Red Bull. I have a feeling you're going to start to see consumers of Red Bull try other products.

18:57Mike Schneider:Or just leave Kroger. But why would you? Let's say Kroger is the dominant grocery store in your area. And as a consumer, as a shopper, are you going to really make that extra trek to go somewhere else to go get your Red Bull? Maybe. Maybe you'll get it delivered from Amazon. I don't know. Have you seen Red Bull fans lately? I don't know. Well, consumers nowadays are making more grocery trips than they had been previously, which shows us that, you know, maybe you buy your meat at this place because it has either a good product or a good price. You're buying these certain staple items here because you get a good price.

19:30But I think this shows that retailers, or at least Kroger, is willing to risk losing a well-known brand to hold price. At the same time, I think that consumers are maybe also willing to forgo a brand that they've been loyal to for a large number of years because they also need to be saving money as well.

19:50Mike Schneider:Well, case in point, we were talking about private label. You were talking about private label. And there's a reason that private label sales are up because in general, they're usually more affordable than branded items. A note at the end of that story about Kroger dropping Red Bull in Boar's Head says that Kroger reported sales of its store brand items, including deli and prepared foods, were up$420 million over the past year. So what's to say that Kroger won't even launch its own energy drink product at some point? Perhaps that won't have as much, I don't know, success as its Murray's deli meat brand?

20:28You think they're going to launch a race car brand and get Max Verstappen too?

20:31Mike Schneider:No, but I'm saying that at the end of the day, if you're a consumer and you want a lot of caffeine in a beverage, what difference does it make if you're trying to save a couple bucks or a buck per can? People are squeezed these days and you might be willing to drop Red Bull as a consumer so that you can save, I don't know,$100 a year. And the Boar's Head loss is a huge one as well. I think a lot of us in the natural products industry may not buy Boar's Head or may not be loyal to it. But, you know, I was born and bred in Massachusetts. And like, if you have a family event and you're serving Boar's Head, like, it's a pretty nice event.

21:16I mean, people have been loyal to Boar's Head for so long. There's a deli in my town that still has a sign out in front saying we serve Boar's Head meat. So this is a really big deal.