FOOD & BEVERAGE

Grow with the Flow

Since the birth of bottled water, manufacturers and execs have been trying to cut down on plastic and appeal to the conscious consumer. As these things often go (see: the death of the metal straw), the movement fizzled out as boxed water lost its novelty. But in 2013, Nicholas Reichenbach was inspired to spark another conversation when he came across a mountain of plastic bottles at Burning Man. (No, it was not an experimental art installation.) Two years later, Flow hit the market.

Now, the sustainable water brand’s hit the public market.  

On Wednesday, Flow debuted on the Toronto Stock Exchange. The reception so far has been lukewarm, despite investors eager for ESG plays. 

• The company’s stock price dropped a third, to $5.67, at the end of its first day.
• Shares continue to hover around $5. 

Bottles be damned: Reichenbach started the Canadian company, his 11th, using sustainable (plant-based, compostable, 100% recyclable, and 68%-75% renewable, to be exact) packaging and natural alkaline water from his family’s artesian spring in Ontario. 

• He partnered with Tetra Pak to build the brand beyond a Burning Man passion project. Flow uses the “Tetra Prisma” format, first popularized by coconut water packaging.
• Flow is now in 20,000 stores, and net revenues reached $20.3 million in the first half of 2021, up 97% YoY. 

“We definitely hit a bull's-eye on a consumer that really wanted a product like this,” Reichenbach told Retail Brew. “We focused all our marketing and consumer insight against the consumer that buys natural grocery...the wellness consumer.”

• 75% of Flow’s 18 million customers are women, he added. “They want better-for-you products, but also better for the planet.”

• Flow is a certified B-Corp, which means it satisfies the highest social and environmental standards. 

Why go public? Flow’s growing fast. “We’re an asset-heavy company. We have vertical integration, which means that we own the springs. We also started building out our facilities in Canada and Virginia...All that infrastructure is over $100 million,” he explained.

• The next step is expanding its direct store distribution. 
• Reichenbach hopes to move to a dual listing with the Nasdaq in late 2022.

“We'll continue to grow our asset infrastructure as we scale into the US. The reason why we're going public is to support that asset growth and support the growth of the brand.”—JG

APPAREL

Brand new (again)

Gilly Hicks is getting another revamp, this time with gender inclusivity in mind. 

The Abercrombie & Fitch brand introduced 100+ gender neutral underwear, loungewear, and activewear options this week. 

• “The brand is celebrating a new purpose focused on helping Gen Z,” Kristin Scott, A&F global brand president, said in a statement. 
• Gilly Hicks also announced a new “Future Stretch” fabric that “accommodate[s] a variety of body types.” 

The new assortment is paired with a new standalone store—no gendered sections here—in Columbus, Ohio, its first since locations were shuttered and Gilly Hicks was folded into Hollister shops.

• More stores might be on the way, depending on how things go in the Buckeye State.

All inclusive: Retailers from Pacsun to Nordstrom are turning to gender fluid clothing to appeal to younger generations. 

• Abercrombie & Fitch introduced its first gender neutral line, dubbed “Everybody Collection,” in 2018.

Zoom out: Gilly Hicks has gone through several brand iterations since debuting in 2008. So far, none has stuck, but gender inclusivity might be the silver bullet. 70% of consumers between 16 and 24 agree or strongly agree that “gender doesn’t define a person as much as it used to,” per a December 2020 Wunderman Thompson survey of 1,000 Gen Zers.—KM

SPONSORED BY KLAVIYO

When You’re Tight, You Text

Think about it: Whether it’s with your G-ma, your best friend, or your dog walker—you text because you’re tight like this:

So why should your brand’s relationship with customers be any different?

Klaviyo tells us that customers are craving more personal ways to connect with their favorite companies—and brands that do it right are seeing unmatched reach and performance from SMS (aka that sacred smartphone real estate reserved for the tightest of relationships).

With Klaviyo’s powerful and intuitive text message marketing platform, you can have that engaged, opt-in audience at your fingertips, while driving even more revenue at a fraction of the cost of paid advertising. 

By the numbers? Klaviyo users who harness the awesome power of text see an average ROI of 24X.

It’s time you got tight with your customers. Try Klaviyo SMS for free. 

INTERNATIONAL

Looking for alternatives

Plant-based meat has taken off in the US, but Beyond Meat is looking across the Pacific to grow its brand. Beyond Meat is now available on e-commerce marketplace JD.com, in an effort to grow sales in China. 

Meat your maker: China is the world’s largest meat market, and meat alternatives are scarce, Reuters notes. 

• The expansion will boost Beyond Meat’s availability in major cities like Beijing and Shanghai and eventually to 300 cities across the country. 
• JD.com’s cold warehouses will deliver Beyond Meat to consumers within 48 hours of ordering.
• Beyond Meat is currently available in China at 3,300+ Starbucks cafes, select KFC, Pizza Hut, and Taco Bell locations, and Alibaba’s Freshippo markets.  

Uphill battle: Plant-based meat alternatives might struggle in China, where consumers are concerned about food safety and taste. 

• “Currently, it is a solo dance by the manufacturers, the consumers are not joining the tango,” food industry analyst Zhu Danpeng told Reuters.
• Beyond Meat competitor Impossible Foods entered Chinese grocery stores in October 2020, followed by Nestlé’s Harvest Gourmet in December.

The big picture: Despite some hurdles, the payoff could be huge. Online fresh food sales in China are predicted to top $46 billion this year—that’s an 18% bump from 2020.—KM 

WHAT ELSE IS BREWING…

• US retail sales increased 0.6% last month in a surprise rebound.
• Johnson & Johnson recalled five of its six Aveeno and Neutrogena spray sunscreens after finding a potentially cancer-causing chemical in samples. CVS followed suit for two of its products.
• Paytm, an Indian digital payments startup, aims to raise up to $2.2 billion in an IPO.
• Amazon was sued by the US Consumer Product Safety Commission for selling hazardous products.
• Dollar General wants to hire 50,000 new employees by Labor Day.

SPONSORED BY LEXER

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SWAPPING SKUS

Today’s top retail reads. 

Back in session: As offices slowly reopen, companies are relaxing dress codes and giving joggers and leggings the thumbs-up. (WaPo)

Buyer’s market: Restaurants are taking advantage of cheap leases in Manhattan as retail rents hit record lows. (CNBC) 

Right on target: The pandemic had a drastic effect on the global supply chain, but companies were mostly able to meet their sustainability goals despite the disruption. (WSJ)

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ICYMI

Catch up on the Retail Brew stories you may have missed.

• Model No. expands its sustainable furniture marketplace
• Big Cardboard is thriving after 2020’s online ordering bonanza
• ReviewMeta wants to helps online shoppers reality check shady Amazon reviews

FRIEND OR FAUX?

Three of the stories below are real...and one is most definitely not. Can you spot the fake? 

1. The person who paid $28 million to go to space with Jeff Bezos now says they’re too busy. 
2. KFC will reveal four of the 11 herbs and spices used in its fried chicken. 
3. Coors Light made actual beer using rink ice from the Stanley Cup Finals. 
4. Off-White is releasing a mobile game. 

Keep reading for the answer.

FRIEND OR FAUX? ANSWER

You’ll have to pry that secret recipe from Colonel Sanders’s cold, dead hands.