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Current Position:Home » News » Beverages & Alcohol » Topic

Coca-Cola enters kombucha category with acquisition of Australia's MOJO brand

Zoom in font  Zoom out font Published: 2018-09-20  Views: 17
Core Tip: The Coca-Cola Company has acquired kombucha maker Organic & Raw Trading Co., which makes the MOJO brand of naturally fermented, live culture, organic kombucha drinks.
The Coca-Cola Company has acquired kombucha maker Organic & Raw Trading Co., which makes the MOJO brand of naturally fermented, live culture, organic kombucha drinks. Kombucha is a fast growing beverage category, boosted by growing consumer interest in natural and gut-boosting refreshments. The terms of the agreement have not been disclosed. This is the first time Coca-Cola has acquired full ownership of a brand in the kombucha category, signaling its intent to offer healthy beverages for all occasions.
 
Coca-Cola has over the past months announced a number of deals and acquisitions underlining its ambition to become a total beverage company. Earlier this month, it reached a definitive agreement to acquire UK headquartered coffee chain Costa Limited for £3.9 billion (approximately US$5.1 billion). In August, it was announced that Coca-Cola is to acquire a minority ownership stake in Bodyarmor – a fast-growing line of premium sports performance and hydration beverages – in a move that signifies Coca-Cola’s challenge to the strong market player Gatorade, which is owned by Pepsi. The company is also eyeing CBD for its potential in functional beverages, as we reported yesterday.
 
“Across Australia, we now have more than 165 products and 25 brands. The addition of MOJO kombucha fits perfectly with the growing popularity of organic, probiotic drinks,” says Vamsi Mohan, President of Coca-Cola Australia.  

Sold throughout Australia, MOJO kombucha is made from naturally fermented tea. Kombucha is a growing niche within the beverage area. The market has experienced rapid growth post-2016, with a four-fold increase in product launches from 2013 to 2017, according to Innova Market Insights data.

Launched in 2010, Anthony Crabb, Co-founder and CEO of Organic & Raw, has gone from creating MOJO in his home kitchen to producing one of Australia’s leading organic kombucha brands.

“Coca-Cola is a total beverage company with massive intellectual capital,” Crabb says. “We can learn a lot about consumer trends and marketing innovation, while Coca-Cola can benefit from MOJO’s unique understanding of fermentation and what it takes to build great-tasting brewed beverages.”

Crabb and Sales and Marketing Director Andrew Buttery will remain in their current roles.

Organic & Raw’s biggest selling kombucha is MOJO CRAFTED KOMBUCHA, a low-sugar, naturally-fermented, live-culture, organic drink.

“With this acquisition, Coca-Cola Australia can take a leading role in helping The Coca-Cola Company in the still-emerging, premium-probiotic kombucha category, which is the fastest-growing beverage category in Australia,” Mohan says. “This is a strong opportunity for us.”

Mohan lists an increasing concern for health and interest in sustainability as consumer trends driving MOJO’s rapid growth.

“Australians are increasingly after great-tasting, low sugar drinks that deliver additional functional benefits, such as gut health,” he says.

“They also support sustainable packaging options, and MOJO uses clear glass bottles that can be recycled. MOJO will play an important part in helping Coca-Cola meet our commitment to reduce sugar by 20 percent by 2025 and in meeting our sustainability commitments through providing recyclable packages,” he adds.

MOJO products are currently sold in about 4,000 health food stores, restaurants and supermarkets in Australia, including Aldi, Costco, Foodland, IGA and Woolworths.

Space for growth
Fermented beverages are on-trend, with year-on-year growth from 2016 to 2017 of 47 percent in the past two years, not including alcoholic beverages, Innova Market Insights noted in a presentation at this year’s Vitafoods Asia in Singapore.

Fermented, lightly effervescent black or green tea drinks, such as kombucha, contain multiple species of yeast and bacteria along with organic acids, active enzymes, amino acids and polyphenols produced by these microbes. They are positioned as a sustainable, well-being boosting alternative to artificial soft drinks.

Over 8 percent of global iced tea launches in the 12 months to the end of June 2017 featured kombucha in a growing range of flavors and formats, up from just over 5 percent in the 12 months to the end of June 2016 and less than one percent five years previously. Numbers rose nearly 60 percent in the 12 months to the end of June 2017, although still from a relatively small base.

The healthy positioning of green tea and kombucha is vital for growth. Nearly 96 percent of global launches in the 12 months to the end of June 2017 were positioned on a health platform of some kind, with clean labeling and digestive health key areas of interest.

Fermented boost

Fermented foods were tipped as the no. 1 superfood for 2018, underlining that consumers will be “going with their gut” by seeking out foods and beverages that improve gut health and overall well-being.

Coca-Cola’s move into kombucha space underlines this trend further, but R&D in the fermented foods and digestive health spaces is still ongoing.

“There are absolutely unexplored potential pathways and benefits for fermented foods,” says Jenna A. Bell, Ph.D., RD, SVP of Pollock Communications. “Over the past decade, science has begun to scrape the surface of the role of fermentation, gut bacteria and the gut microbiome in human health. I think that consumer interest in fermented foods will only drive more research and increase the availability of fermented foods.”

 

 
 
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