[00:00:03] Ray Latif: Hello, and welcome to another edition of the BevNET podcast. I'm Ray Latif. I'm here with John Craven. We are at the Spindrift offices in Waltham, Massachusetts, just down the street from the BevNET offices in Watertown. We're joined by Spindrift founder and CEO, Bill Creelman, and Strick Walker, who is the chief marketing officer of Spindrift. Thanks so much for having us, guys. Yeah, thank you. this big rebrand or sort of label refresh that you're launching pretty soon. And sort of the ideas and the concepts and the strategies that went behind or that are part of this rebrand. And we had visited and spoke with you guys a few days ago. And leaving that conversation, we came back with this sense that the word real is so important to everything that you do as it relates to your business strategy and your marketing strategy and now this rebrand. Let's start there. You know, why is real the differentiator? Why is that the such, you know, the important word for you guys at Spindrift?
[00:01:14] Bill Creelman: Maybe I'll start. I mean, I think it, I don't know that it was, it's any different than six years ago when we began as a brand. I think what happened, if I could go back a little bit in time, is we started making Spindrift using fresh ingredients. really to kind of challenge the category. And I think we would all agree over the last six years, there's just been an incredible evolution in sparkling beverages. And we, from the beginning, have wanted to be a challenger brand and really kind of disrupt what was happening. So without really knowing where the category was going, we did what felt right to us, which was take fresh juice, squeeze it, and just make the best product we could. I think what we found over the evolution of the product is that increasingly we felt that there was confusion in the category, that starting with soda is just The fact that sodas have all kinds of weird ingredients that I think everyone now is turning the can around and looking, it was really incumbent on us to just come back and be really super clear with our consumers to exactly what makes us different.
[00:02:20] Ray Latif: Yeah. And Strick, again, we were talking about this last time. It's incumbent on consumers to you to educate consumers about what's in your can and what's real and what's not real. And there is a lot of confusion still out there about what's in sodas. And you're kind of starting to sort of want to strip that all down and say, look, You understand what sparkling water is, you understand what juice is, that's kind of who we are.
[00:02:40] Strick Walker: Yeah, that's right. The good news for us in marketing or communication is that it is such a simple message. It's real fruit, bubbles and water. So it really doesn't get much more simple than that. And frankly, I think the space is just so full of concoctions and confusing functional beverages that it's just getting harder and harder for people when they You know, they've got 45 seconds essentially to choose a beverage and they're looking at the wall of options. We're just really excited that we have such a simple proposition. It's just as if you were at home and you squeezed a grapefruit into sparkling water. I mean, it's the same thing. So it's pretty simple. And there's such a void of real ingredients we find in the category that consumers are really responding to the real fruit option.
[00:03:23] Ray Latif: And John, I know you had a question about, you know, the sort of dynamic as it relates to, you know, the craft soda side of what they do and then the sparkling water side of what they do and how, you know, you're sort of fighting on two fronts, not necessarily fighting on two fronts, but you're sort of, you are on two fronts. Sorry, I thought my microphone is falling down as we as I asked this question. So perils of perils of I guess, I'm just sitting here laughing at you trying to with your plastic.
[00:03:50] John Craven: All right with your gear.
[00:03:51] Ray Latif: We're back at it. I interrupted your your line of thinking there.
[00:03:55] John Craven: No, that that's all right. That happens when we're doing these. Yeah, sometimes. Fortunately, no one can see it. And I don't know, maybe this will get edited out. It's interesting that you guys have played sort of in two categories that, as Ray mentioned, you know, craft soda is something that kind of has its own trajectory. And then there's this sparkling, you know, flavored water. It's almost as if you're sort of straddling like the high end and then you're dealing with pressure from the super low end, you know, flavored. How does that all sort of come together for Spindrift kind of as a company and keeping that message like kind of consistent? across both product lines?
[00:04:31] Bill Creelman: Well, I think, first off, we don't have all the answers, obviously. And I think we're still very much in the first inning of this game. We're one of a variety of brands trying to figure it out. You know, my philosophy is always just to be true to who you are. When we evolved as a company, we started with sparkling water, real fruit and a little bit of cane sugar. And that product still remains, you know, really core to our business. It's really an entry point, I think, for a lot of consumers. They find us out in the food service world at their favorite bakery or cafe or coffee shop. What we found as we evolved, and again, it wasn't really an outward journey, it was just an inward journey, is that we all in the office started wanting to try to have something more on a day-to-day basis that we could really enjoy outside of the meal occasion. And that's where we came up with the idea of why don't we just remove the sweetener. So we don't think about it as really two distinct categories. I know certainly the classes of trade that the two products play in are distinct. We really think about it as a single experience. It's someone looking for a product that has, you know, kind of fits their lifestyle, fits who they are. They're going to an amazing sandwich shop and they're excited to try chicken that's been made from scratch, delicious breads. To me, that's an occasion you'd want to have a sparkling water or a sparkling beverage of a similar quality. And then there's just going to be other occasions during the day that you might want something that's a little bit less sweet.
[00:05:58] John Craven: And I guess as far as this rebrand, which we're looking at it here, we can't show it yet or really talk about it in detail, which is, it looks great. I'll say that much. Thanks. Definitely looks like a step forward and sort of one of those packages where when you look at it, you kind of, honestly, it feels like a big step forward, even though there's nothing wrong with the current packaging. And that seems to be something that we've talked about a bunch lately between brands like Dry Soda going to Dry Sparkling. And this is sort of a similar evolution. Can you talk about just what we were trying to achieve with the change.
[00:06:29] Ray Latif: And I just want to build on that real quick. I mean, it's interesting because BevNET, when we do our best of awards for the best of 2015, we awarded the best water product to Spinsurf Seltzer. And so, you know, we like obviously the liquid and the packaging. The question is always like when you do something like this, if it's not broken, why fix it? And you guys, in essence, are saying there isn't necessarily anything broken, but the messaging can be tweaked a little bit to really broaden our consumer base.
[00:06:53] Bill Creelman: Yeah, I'll let Strick speak to the process a little bit more. I mean, for me, just because we're starting to have some success in a couple of classes of trade, it doesn't mean that the journey's over. I mean, as an entrepreneur and as a brand that's challenging convention, you have to remain curious, you have to hold on to the past, but you also have to really be constantly thinking about the future. And I think, as I just said, I think we're still super early in this process. But we do have a lot of funds saying, wait a minute, why are we changing all of these things? It's working, people are responding. But we did feel like there were some open questions. We know that we heard from our consumers and we've really listened hard to all of the various social channels and the website write-ins. And the general consensus is that there wasn't anything wrong. really landing on a message that we could all rally around and really articulate in this confusing category was really necessary for us.
[00:07:52] Strick Walker: I would just add that in terms of the package redesign, we really just wanted to get that real fruit proposition out there in a very clear, very simple way. Our goal is to be as transparent and as simple as possible. So again, when you're standing there at lunchtime or you're at Trader Joe's or you're at Panera or wherever, you don't have a whole lot of time to make a decision. We just want to make sure you understand what you're in for if you grab a spindrift. So we just brought that sparkling water and real fruit message to the forefront, just trying to be as simple as possible. And to me, I think it's almost shocking that real Fruit really doesn't exist in the sparkling category. So we just want to take advantage of that proposition. And it's really become a brand proposition, even more than a product proposition. Frankly, we sort of feel like we all just celebrate real, just real ingredients made by real human beings with a real connection to, to the environment, which explains a lot of our environmental work and 1% for the planet participation. And so real has become a real brand conviction, frankly, and we wanted the packaging to very clearly say that.
[00:08:52] John Craven: And on that, it seems like just from talking to you guys, you're almost, and I find this kind of funny, like recalibrating people's sense of flavor and color of the liquid when it comes to what happens when you mix fruit and sparkling water. It should be clear and zero calories. And you guys have kind of an interesting mix where you have, I think it's the blackberries flavor that's really bright in color. And then there's this cucumber one that I'm drinking here. That's basically clear. What kind of challenges does that create for you? And to be clear about that, we're talking about the seltzers.
[00:09:22] Bill Creelman: It's funny. We, we. I've been out in the market recently with buyers and we'll sit in front of a competitive set and they'll pour the first clear product, pour the second clear product and we'll pour our product and literally it brings the meeting to almost a grounding halt. There's almost disbelief and surprise that our product, that there would be color in a sparkling water with real fruit and I think that really speaks to the state of where sparkling water is and carbonation is. There's the disbelief meter has swung so far over that people I think have almost become to accept a certain amount of added color and flavor. And so I think we really view this process in particularly the repackaging as a way to kind of bring them back. It shouldn't be surprising that your raspberry lime seltzer made with raspberry puree and fresh lime juice is red. That should be what it looks like.
[00:10:18] Ray Latif: Yeah, and you guys did a lot of qualitative research on this, and it was pretty interesting to hear you talk about the process itself, going into people's homes and in certain areas of the country and really looking inside their refrigerators. And, you know, it's a process I'm not familiar with, and you guys undertook it and found some really great learning lessons from it. Stuart, can you talk a little bit about that?
[00:10:36] Strick Walker: Yeah, definitely. I mean, we always try to just stay really in touch with the consumer and we were still small brands. Engaging with our consumers is always really important just to make sure we maintain an understanding of what they're going through every day and what they're drinking and why. So we did some qualitative research where we actually wanted to go into people's houses Amanda Huang out with them for a couple hours and just talk to them about why they make the choices that they make. relative to food and beverages, frankly, for themselves, for their kids, just to figure out where people are with respect to soda or how they feel about bubbles or not. I mean, again, it's such a confusing, rapidly evolving category that maintaining that connection with consumers is really important. And I always find that as opposed to doing focus groups or something like that, if you really just go hang out with someone in their home for a couple hours and then they take you through their kitchen and they show you their refrigerator and you get to meet their kids and their spouses and it becomes a much more meaningful, insightful kind of experience. And so we learned quite a bit. from that research. And again, we just sort of try to, whether it's at events or cruising around retail environments, we just try to stay connected to consumers to maintain that empathy. And it's really helpful for us as we think about product innovation or messaging or anything. And I think the biggest takeaway for me was again, just that it's a very confusing space and, you know, whether it's cranberry or berry or blackberry or unicorn berry, it's always clear and it's zero and it's artificial and it's alternative sweeteners. And people just want to know, similar to the way, you know, they're very food conscious these days. They want to know what they're drinking too. And it's hard. It's hard for them to sort through it.
[00:12:14] Ray Latif: Yeah. John mentioned that, you know, when you do these retailer comparisons or you go to retailers and you compare different sparkling water lines, different soda lines and things like that, the reaction sometimes is, well, your product looks different than any of these other products. You know, why? Was that the same kind of reaction you got from consumers? Are they kind of like confused about your proposition and the fact that for your seltzers, at least they're not zero calorie. They're not, well, some of them are not zero calories and they're not clear, you know, they're not transparent.
[00:12:42] Bill Creelman: I think that's how you know you're doing something right. If you look at all the entries that are coming in, they're all very, very similar looking. They're basically doing a different version of a well-worn path of sparkling water with natural flavor. And so from my perspective, we try to stay out of businesses that other people are doing. So real innovation, I think, always has an education component to it. And in this case, we felt that it was an achievable education that by putting in the real ingredients naturally, some calories are going to show up. There's calories in raspberries, there's calories in limes, but we felt that the dimension of flavor that came with that and the relatively small one or two calories or zero in the lemon or one in the, that it was a manageable amount of calories to still kind of participate in the sparkling water product type.
[00:13:30] Strick Walker: It's a reintroduction often, you know, they just kind of, and, and many people do it at home. You know, when you talk to a lot of people, they're squeezing lemons into sparkling water or grapefruits, or it's a reintroduction almost to fruit. And we just embrace the calories. Yeah. The raspberry lime has got 10 calories and. And it's red. And once you have that conversation with people about reintroducing them to fruit as opposed to the kind of artificial flavors and sweeteners and things that they're getting accustomed to, it's like things become very clear and people love it.
[00:13:59] John Craven: Well, it seems like the fact that you've managed to create products that have a lot of flavor and also they're low in calories and sugar, which is different than, say, some of the sparkling 100% juices that are out there. Is that something that you see as, again, a challenge, an opportunity, not being 100%? I mean, it seems like before Spindrift existed, that was kind of where all the sparkling fruit-based products were going, weren't they?
[00:14:23] Bill Creelman: Yeah, definitely. Yeah, I think it is a challenge for sure. And I guess to go back to our earlier conversation, for us, it's about finding somewhere to tell a story. And ultimately, when we started the brand in 2010, we took the product to a lot of different environments. And the one that was the most responsive was the food service environment. The folks that were making amazing salads right in front of you or making sandwiches right in front of you, and they got it as it related to food. I think we then just kind of spoke their language where you wouldn't necessarily tell your consumer that you would take the same thinking that you know where your food comes from, you should know where your beverage comes from. So we didn't really think about what was happening in the rest of the space. We really just kind of stayed with what made sense to us because we're frankly all consumers. We're all farm to tablers, you know, we're all out there participating in this movement that's happening in food. And so that's really, really where we go instinctively when we do our product development work and brand work.
[00:15:22] Ray Latif: And food service is still, you know, you started with food service and it's becoming a critical channel for a lot of different brands, a lot of different products. It's funny, I was at Penn Station yesterday and I stopped by this little sushi place. I don't know if you should be eating sushi at Penn Station, but I did. Probably not. It was pretty good. But the beverages they had, it was just like such a difference from what it was five years ago. You might've had Sprite and Coca-Cola and stuff like that. And there were teas, there was kombucha, there was sparkling water, there was high-end juices. It was really interesting to see that. It was pretty eye-opening. But you guys are really, you're doubling down, you're really pushing the gas on food service, trying to go even deeper with that on a really national level. Is that a critical aspect of your business strategy at this point? Is that really making food service the driver of sales off-premise?
[00:16:03] Bill Creelman: I don't know that we think about it that way. I mean, we started out with, as I think many brands do, you know, in our local market, making product and selling it to the people that would buy it. So it happened to be more of the smaller independents, you know, the flour bakeries. You know, these spots, Boloca, you know, the people that I think are setting the trends around the lunch occasion. So what's happened over time is just that now we're starting to get, it's the same starting point. It's just some bigger footprints. And I guess that's number one. Number two is we think of it even six years later is still a great starting point for people that want to try an individual can or bottle who may not want to make a full investment in a larger format. It's cold. The product is cold. Generally, if it's in a cooler, it smells delicious. There's food. There's generally some music. It's well lit. It's a great place to experience a brand for the first time. You know, it's an exciting from a sales perspective, it's incredibly challenging. We have a crazy network of distributors servicing these folks. So it is a commitment for sure, business-wise. You really have to decide you want to be in this space, but we believe and continue to believe that it's important for us. But at the same time, we also recognize that people want to buy it in take-home formats too. You know, if you love it, you're drinking it every day, then it's almost an obligation for us to then say, let's make this available in a way that you can go home and enjoy it with your family. That's more of our approach with food service.
[00:17:31] Strick Walker: Okay. I think culturally we align. I just feel like we align with food service pretty well. I mean, they're entrepreneurial. They're really thoughtful about the food. They're chefs. They're just, they're just kind of moving quickly and making choices. And so we really, that resonates with us culturally. And so you'll see us telling stories about our favorite food service partners. We did a little video about chopped salad. We're doing some profiles on dusty buns and Boccolone in San Francisco and you know, Mei Mei Kitchen and a lot of these food service organizations that we really respect. And they carry Spindrift because, as Bill said, they want to be thoughtful about their beverage options as well as the food options. And so culturally, it's just a really important piece of our brand, frankly.
[00:18:11] Ray Latif: Yeah, it's interesting hearing, Bill, you had mentioned Beloco and Flower Bakery. These are two local brands here in Boston. I've never heard of Dusty Buns. Where's Dusty Buns? San Francisco.
[00:18:19] John Craven: San Francisco. Yeah, yeah. Ray's writing it down.
[00:18:22] Strick Walker: You gotta get out there. It sounds like it. They're not really dusty.
[00:18:29] John Craven: Hey, this guy eats sushi in Penn Station.
[00:18:32] Ray Latif: Yeah, exactly. He's a risk taker. Yeah, exactly. One last thing I wanted to sort of talk about was there's money that you need to sort of drive this engine. And you recently, earlier this year, did a pretty significant raise, raising over $7 million. What is that money going toward? Can you tell us about the right partnerships? Why the partnerships that you make on that fundraising level are just as important as the ones that you're making at the distributor and retail level?
[00:18:53] Bill Creelman: Yeah, I think when we talk about the brand, we really talk about it extending all the way through the investors, you know, if you decide to go that route. And so, you know, my process was really to always find investors that are complimentary, but that are also going to challenge you. And I talk about our group that we have now is really among the choices, and we are fortunate to have some choices as asking the best questions. And I think your investors have to believe in your mission. I know when we started, A big challenge for me is that people coming into the natural food world, they'd say, what are your sales like in sprouts or whole foods? And when your strategy is early on was really all about food service, it was tough to answer those questions. And so you had to ask yourself, is there an alignment issue here? Do I want to bring people in if they don't really believe in the mission? And so we're very fortunate now to have investors that really believe in the whole opportunity, this idea of really transitioning people and evolving the sparkling category. As far as how we're using the funds today, I mean, the strategy that you've heard us now articulate, it remains the strategy. I think had we had this interview six years ago, I think a lot of these same things would have come up. So it's expanding, continuing to expand food service. It's building the team. It's the articulation of a disruptive message is expensive. It would be far easier to just kind of toe the line that the more established brands have taken. And so, you know, by going an alternative direction, we need to be able to fund that. And that's really what we're doing.
[00:20:24] John Craven: Great. And I guess one last question, just to put it into perspective for you guys. Bill, you previously had built Stirrings, I guess, maybe a different time and place in the world then. And Strick, you've worked with companies like Patagonia and 1% for the Planet, among others. How does this sort of entrepreneurial experience compare with what you guys have done in the past?
[00:20:45] Strick Walker: Yeah, it's been a really fun ride. I've been here for almost a year at this point. And, you know, rapid growth is exciting and we've added a number of new people. And I mean, I signed up with Spindrift because I really believed in what the company was doing. And you mentioned 1% for the Planet. I was there for a few years, kind of helping to put that org together. And Spindrift has been a member of 1% since the very beginning for the last five, six years, meaning that 1% of revenue before anyone gets paid goes to environmental organizations. And so, I've just always really believed in the mission. I believe in providing consumers with something real, something with real fruit, with ingredients that they can understand. So I'm really just personally aligned. And it's been a real journey. Like you mentioned also, I've spent time in apparel and sort of footwear. So the food and beverage business is new to me. So I'm learning a lot every day and having a blast.
[00:21:33] Bill Creelman: Yeah, as you said, I mean, it's a different time. What excites me is tackling a big challenge like carbonated beverages. I mean, six years ago, people thought that sodas were going to go away. I mean, that was really the problem that we set out to solve. And now it's changing, it's evolving. So personally, to find a kind of area in this much bigger category that we can really bring to life for people is incredibly exciting. You know, we also brought on the benefit of, I think, having done it once before, you know, the importance of a team. And so while I obviously started the idea, there's now Strick and we have an amazing team that's really bringing it to life. And so that's sort of doubly fun to be sharing it with other people.
[00:22:14] Ray Latif: Awesome. Very cool. I've been waiting to do this the entire time we're here. Ani, I want to open the spindrift seltzer made with fresh squeezed grapefruits. I'm going to have a sip. Instant review. Outstanding.
[00:22:25] Strick Walker: Great stuff.
[00:22:26] Ray Latif: So, all right. I really appreciate you guys having us here at the office and taking the time to speak with us. Good luck with everything, including the rebrand. Looking forward to seeing how it all pans out. Awesome. Thank you guys.
