Jones Soda recently put out a press release detailing their upcoming entry into the sparkling waters segment, launching three flavors of sparkling water under a product line titled “Au Naturel”. The press release in its entirety is available here, and BevReview.com covered some additional information talking about other products that Jones has previously launched and/or re-introduced: Jones Naturals, Jones GABA, and Whoopass Energy Drink among others. The link to BevReview’s piece can be found here. Jones Soda’s press release also indicated that the product line will be stocked in natural grocery stores, which mean that stores like Whole Foods, Choices Food Market, and Urban Fare may have these products in stock soon.
This is an interesting launch for Jones, since the most of their previous beverage introductions have been in the premium soda and energy drink categories. That is not to say that 24C, Jones Juice and Jones Naturals are not successful, but they have not been able to capture the same level of publicity and success that the other launches recorded. The launch of Au Naturel marks an entry into another completely new category, one with a different set of competitors and challenges. The launch still provides a level of similarity for Jones Soda since their most successful product launches share the following characteristics: premium and niche. For example, Jones Soda itself using sugar cane for a variety of their 12oz glass bottle sodas and Jones GABA doesn’t include caffeine. This gives Jones experience with bringing premium beverages to market – the category may be different but the experience and skillset should be transferrable from premium sodas to sparkling water. Also of significance is that sparkling water gives them a shelf presence in a different area of the grocery store, or in another set of grocery stores altogether. Au Naturel will be distributed in natural grocery stores at first, but may expand to regular grocery stores if there is enough traction.
On the challenges that Jones will face, they may be similar to the challenges that Jones Soda faced with launching their Juice, Naturals and Organics products. These other categories all have a different of competitors, and much more store-brand (private label) competition. Unlike sodas, the markets are less regulated and monopolized, making competition more likely. The category itself is more commoditized, and telling consumers to trade-up to premium sparkling water is a significant problem. Despite bottled water sales growing this past year, the category is currently challenged with educating consumers on the added benefits between tap water and bottled water. With all these challenges, does Jones Soda’s expertise with featuring premium soda transfer over into featuring sparkling water? Will Au Naturel be a short-lived offering, an experiment to see how another category may provide diversification for the company?
Even with all the challenges that the water category brings, I feel that this product launch has a stronger chance of success that some of Jones Soda’s other launches. The key difference is that water itself is seen as wholesome and healthy, and the market trends shows consumers increasingly prefer healthier alternatives. In order to compete with the more established sparkling water players, Jones may need to look to alternative channels to gain distribution and popularity. One suggestion may be to look for opportunities in the on-premise channel such as salad & health food joints, and smoothie & yogurt shops. By stocking their sparkling water in these establishments, Au Naturel aligns themselves with healthier alternatives that shoppers want. Gaining traction in the alternative channels leverages on these shoppers to look for their products in the traditional grocery store and gain more shelf space.
Since consumers expect their food and beverage options to become increasingly health conscious, Au Naturel’s entry into sparkling waters is preemptive and a good chance to diversify their product offerings. Should Au Naturel see strong sales in their current grocery stores, it is likely that their expansion into more locations would come quickly. Cross-border expansion may also be a possibility at that time, and hopefully that means I’ll be able to find Au Naturel locally rather than having to make a trip down to the U.S. to find it!