Why Is Coconut Water Suddenly So Popular?

The stories behind the stuff we buy.
Nov. 7 2011 12:45 PM

“Gatorade Is the Antichrist”

How coconut water suddenly became ubiquitous on American shelves.

(Continued from Page 1)

Soon enough, the target demo expanded to endurance sport athletes like cyclists and runners—who are very conscientious about nutrition and hydration and thus always on the lookout for new products that might give them an edge. Now, even pro athletes in the major sports leagues have caught coconut fever. A-Rod shills for Vita Coco, and Zico has signed basketballer Kevin Garnett as an endorser. Rampolla says several NFL teams purchase a steady supply of Zico to keep on hand for players. For most of us, drinking plain old tap water is probably an adequate way to hydrate after exercise. But coconut water, like regular sports drinks, does pack in potassium and other electrolytes that legitimately aid exercise recovery.

Despite triple-digit growth in the category for the last few years running, coconut water has still managed only 3 percent household penetration in the United States, according to Rampolla. To become more than a niche product, it will need to move beyond sports. To this end, Vita Coco has associated itself with a raft of nonathlete celebrities—including Madonna, who has become an investor and has brought onboard other Hollywood types like Demi Moore and Matthew McConaughey. Zico’s packaging suggests some not-so-jocky uses for the drink, including as a remedy “after a rough night out.” (Rampolla swears by coconut water’s efficacy as a hangover cure.) There’s precedent for this sort of evolution: Vitamin Water has already made the multistep transition from a specialty beverage for health nuts and celebrities to a general, mass-market sports drink, to something office workers quaff during their sedentary lunch breaks.

Making that leap requires not just great marketing but also great distribution. Coconut water has already made the move from the counter at the yoga studio to the shelf at the natural foods shop to the aisle at the Whole Foods. The key at this stage is to become a major seller at a big supermarket chain like Safeway or Publix.

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Beverage distribution remains a convoluted business. The big fellas like Coke and Pepsi can mostly get their way. But smaller brands are forced to cobble together a network of independent distributors to get their beverages in front of buyers. Distributors have limited bandwidth—they will bet on brands they think have promise, and then drop those brands if they don’t sell. In the New York area, Zico has partnered with the legendary distributor Big Geyser, known for establishing previous fledgling beverage brands such as Vitamin Water, Muscle Milk, and Honest Tea. In other markets, Zico will team up with food distributors, or even sometimes with Coke, to win proper store placement.

Rampolla says he’s studied two other single-ingredient beverage fads to see what clues they might offer for Zico. The first is Pom Wonderful, the pure pomegranate drink, which was rolled out with an expensive marketing campaign and soon became a bit of a sensation. Rampolla says Pom benefited from excellent distribution but is ultimately limited in the scale that it can achieve with its intense flavor. The second is soy milk, which could once be found only in hippie health food stores and now resides in the beverage aisle at my local Target. “It’s grown into a category that’s well over $1 billion,” says Rampolla, “but it’s all at-home use. It’s got no potential as a grab-and-go beverage. Coconut water can be both.”

Will we really see moms in Dubuque stocking their fridges with 64-ounce jugs of Vita Coco, pouring it for the kids at breakfast? I suppose it’s possible. But there are some stumbling blocks. Chief among them: I find coconut water to be … an acquired taste. Which may explain why I’m seeing so many other flavors added to it. (Vita makes a coconut water with acai and pomegranate—a faddish ingredient three-fer!) Besides, part of what makes coconut water so popular in Asia and South America is that it’s already there, cheap and abundant, literally growing on trees. Once you expend the energy to ship it here, package it in Tetra Paks or aseptic bottles, and plaster every bus in sight with Rihanna’s face, you lose a measure of that simple appeal.

My guess is that America’s infatuation with coconut water will eventually cool. We’ll push it to the periphery, over with those long-unsold bottles of pear juice and apple cider. And we’ll move on to some other, as yet unexploited natural ingredient—patiently awaiting its moment in the sun and on the supermarket shelves.  

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