How one brand is retaining its challenger status

Coconut water might be growing in popularity but it is still a relatively niche product. According to IRI, household penetration has nearly doubled over the past two years, but still only stands at 7.5%. Compare that to other soft drinks, such as juice, where penetration is above 50% and its clear coconut water is still just a small player in the market.

However, it is in strong growth. Coconut water saw sales rise by 8% in 2016, making it the second biggest contributor to growth in the chilled juice category. And Vita Coca is the biggest player, with a majority market share of 50.4%, according to the brand, despite launching here just seven years ago.

The brand’s EMEA CEO Giles Brook says Vita Coco has grown quickly by positioning itself as a “lighthearted and engaging brand” instead of “preaching” to consumers about its health credentials. That doesn’t mean it isn’t proud of those though, with Brook keen to highlight that coconut water has 40% less sugar than fruit or a smoothie.

“In the early days, we did utilise celebrities such as Rihanna. But we’re continuing to evolve; If you look at our current campaign we are wanting to promote escapism and make a more emotional connection,” he explains.

That current campaign is Vita Coca’s first foray onto national TV as it looks to double household penetration and raise awareness among health-conscious consumers. The multimillion pound ‘Reach for the Beach’ campaign will run for four months over summer and include out-of-home, digital, experiential and PR activity.

“Not for concentrate juice has 55% household penetration – that’s where we’d like to get to. In another two years we might not get to that specific figure, but we would at least like to double or triple awareness. So was now the right time to go on TV? Yes,” says CEO for EMEA, Giles Brook.

We are more of a challenger brand than we first started. We have invested more heavily and can get greater reach, but we don’t forget where we came from.

Giles Brook, Vita Coca

TV advertising is just one part of the strategy. Equally as important, says Brook, is getting as many consumers as possible to try the brand.

“We work tirelessly to put products in people’s hands. Our TV campaign is very important for us, but this year we will also be sampling one million units,” he says.

Despite the multimillion pound marketing investment, Brook insists Vita Coco has maintained its challenger brand status. It remains an independent business and wants to disrupt soft drink incumbents like Coca-Cola and Pepsi.

That challenger status is also shown through the brand’s opportunistic behaviour.

“When one of our campaigns goes live, every single person in the company, including finance and HR, is pounding the street to sell the brand to consumers. Over the two days [after it launched] we brought on new outlets for the company – that’s the sort of thing a challenger brand does. It’s about how you act and behave,” he explains.

“We are more of a challenger brand than we first started. We have invested more heavily and can get greater reach, but we don’t forget where we came from. So we’re doing lots of sampling, lots of small touches that we know made us successful in the first place.”

Another advantage Vita Coco thinks it has over some rivals in the soft drinks space is that it won’t be affected by the sugar tax, which is coming into force next year and will see a Government levy placed on all sugary soft drinks, except milk-based or fruit smoothies. Brook predicts the tax will provide the brand with a competitive advantage.

“[All we do] is crack open a coconut and take the coconut water out. People want products that are natural and simple, they want ingredients they can understand and don’t want artificial sugar. It will give us a competitive advantage, as our product hasn’t been messed around with,” he concludes.