After yesterday’s announcement that SYSTM Foods had acquired Humm Kombucha, we spoke with SYSTM CEO Andy Fathollahi to learn more about how the CPG portfolio company aims to use the low- and no-sugar beverage brand to lean deeper into the rising gut health trend. 

SYSTM Foods also houses beverage brands REBBL and Chameleon Organic Coffee. While SYSTM is aiming to style itself as a functional beverage portfolio business, he said having a clear purpose for each brand is key to its strategy. For example, after it acquired REBBL in 2022, SYSTM nixed the brand’s own gut health boosting Pop line, which Fathollahi said didn’t make sense for that particular brand. Humm, meanwhile, is perfectly suited for it.

Part of the company’s philosophy, he said, is viewing kombucha as an ingredient, similar to the way brands like Poppi utilize apple cider vinegar. What future innovation for Humm will look like is “TBD,” but Fathollahi said SYSTM intends to revamp the brand’s existing portfolio and rationalize SKUs while working to remain true to the brand’s original voice and vision.

Humm has frequently been on the forefront of kombucha innovation, introducing a Zero Sugar line in 2020 that provided what Fathollahi suggested was a powerful differentiator to other brands in the category with higher sugar content.

The main goal now is to reach new consumers and grow distribution, especially in the natural channel where Humm’s footprint is lower. To do that, he said creating delicious, functional products that appeal to consumers’ taste buds will be key.

“The consumer likes a delicious product, and the reality is that some consumers have decided they don't like kombucha because of that strong flavor profile,” he said. “I love it, personally, I think it's great, but it's not for everyone, and the really delicious product that is out there in that low-sugar gut health space has performed incredibly well.”

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⚡ Yerbaé ended the year with a unique partnership with Penn State’s NIL cooperative that includes bringing the energy drink to various Pennsylvania state retailers. Adding to those gains, the brand announced this week it was also going to be available in Mariano’s, one of Kroger’s Midwest supermarket chains. Starting next week, Yerbaé will be in all Mariano’s locations in the greater Chicago region with four varieties — Mango Passionfruit, Black Cherry Pineapple, Yuzu Lime and Classic Lemonade.

🌾 For those who live on the West Coast and have been waiting to try Graasi Barley Water, the wait is over. The plant-based, organic hydration and immunity beverage will now be distributed through select retailers in the region as it partners with KeHE and beverage broker Cascadia Managing Brands.

🎛️ After a successful launch in New York City in September, RTD cocktail brand Juice Runners is now available in the Windy City at Foxtrot. The brand’s mezcal-laced Paloma Remix is the first RTD cocktail release from hip-hop group Run The Jewels new beverage venture BARTJ.

🚛 Mother Kombucha has partnered with Mt. Sterling, Illinois-based distributor Dot Foods to expand its national foodservice footprint for both its beer bottle line of kombuchas and its probiotic sparkling water Agua Bucha.

🫖 Country musician Morgan Wallen-backed The Ryl Tea Co. has hit the mark with Target. The 16-oz, canned iced tea brand is bringing four SKUs (Raspberry, Peach, Lemon and Half & Half) of its functional beverage to select Target location shelves.

Organic iced tea company Saint James Tea has added Tom Kurtz as VP of sales and distribution to lead the growing brand’s field sales strategy and field teams. Kurtz comes with over 25 years of experience working in a variety of executive roles at PepsiCo, VP of sales and distribution at Poppi, and, most recently, was VP of sales for zero-caffeine energy brand Update.

👆 Coincidentally, the new year has brought a new job (at another iced tea brand nonetheless) to another industry executive with the same last name. According to Beverage Business Insights, The Ryl Tea Co. has brought on Ken Kurtz as president after he spent the last five years as CEO of Crooks & Marker, the canned cocktail venture from former Bai founder Ben Weiss.

🪇 Congo Brands, the maker of Alani Nu and PRIME, is taking a page from the Liquid Death playbook by signing the canned water brand’s former executive Mark Sherer to be the new VP of sales and distribution. Sherer formerly worked in similar roles at Bang Energy and at Red Bull for over seven years.

🥥 Canned coconut water brand 100 Coconuts has brought Monica Fleury in as its CMO. Fleury comes to the brand after running marketing for Biolyte for the last year and, before that, eight years working at HOA Brands restaurant group.

Where were you when you first discovered oat milk? For many Americans, the answer is in a coffee shop or in their kitchen holding a freshly brewed morning cup, and thus began a love story that shows no signs of weariness. As of this morning, Hood’s Planet Oat brand is the latest player to make a more concerted effort to capture coffee consumers via the national release of Barista Lovers Oatmilk 

🥛 As Adrianne DeLuca wrote in BevNET Magazine’s December cover story, the ties between coffee and plant-based milks are tighter than ever: along with more barista-focused oat milk SKUs from RISE, Minor Figures, Elmhurst and others, more niche varieties like pistachio milk (Táche) and coconut milk (Vita Coco) earned validation through on-premise coffee partnerships across 2023.

Just in time for Dry January, and further proof that non-alc is being adopted on a broader scale, Ritual Zero Proof will be hitting menus nationwide at restaurant chain Uno Pizzeria & Grill this week.   

🍸 Guests at Uno’s 71 locations can now order from a new line-up of non-alcoholic beverages including a Margarita, Hurricane, Old Fashioned and Peach Mule, or indulge in a classic cocktail with Ritual spirit alternatives.  

👍 Climbing sales of zero-proof products in the beverage industry fueled the move and “symbolizes the evolution of our offerings alongside the zero-proof movement,” Chris Dellamarggio, Uno Pizzeria director of marketing, told BevNET. Ritual’s alternatives give the company the flexibility to craft new NA cocktails from existing fan favorites and the freedom to explore new and creative drinks options moving forward, rather than being tied to canned options, he added.

🍽️ Ritual is one of the many brands pursuing the non-alc cocktail trend at restaurants and bars, as the category shifts from the direct-to-consumer platforms that boosted brands during pandemic lockdowns.

It’s high time for the non-alc category (👆 see Ritual’s partnership with Uno Pizzeria above) and everyone is cashing in on Dry January. Newly launched smart beverage cooler maker Rocco has only been on the market since November but is already tapping one of the beverage industry’s “cool kids” — non-alcoholic specialty bottle shop Boisson — with its first partnership to help build momentum for the modern appliance brand.

🍾 Boisson is sending a starter pack of NA beverages including Ghia, AL’s, Little Saints and Giesen Wines along with every Rocco fridge sold during the month.

🍸 The Rocco Super Smart Fridge uses compression technology to make a living room accessory (or trendy bar cart) for the dedicated beverage connoisseur. It features reversible racks, modular shelves with isolated cooling zones and a patent-pending sight system that lets users see inside their fridge using a smartphone.

Get ready for our January Community Calls! This month, learn how to navigate Whole Foods as a brand, dive into data-driven trends for building your beverage business, explore updates and best practices from the New Hope team for Expo West 2024, and hear from NielsenIQ on navigating today’s shopping trends. All of our January 2024 calls are free and open to the public – just register in advance and mark your calendar. Our first call focused on achieving exponential growth in CPG takes place today, Jan. 4, at 1 PM ET. Register for free.