• 🍶 How Sake Brewers Are Chasing Trends
• 👀 Juan Soto's New Energy Partnership
• 🥃 Spirits Respond To Trump’s Tariff Threat
• 🛒 Walmart Rolling Back DEI Policies
• 📈 Heritage Distilling Completes IPO
• 🧑‍⚖️ Workers Sue Kroger, Albertsons 

When we last caught up with THC-infused soda brand Drippy back in April 2023, the brand was eager to pitch itself as “an enhancement” rather than a replacement for experienced smokers. With that in mind, California’s regulated dispensaries seemed like a natural place to start.

But as with just about everything we probably believed a few years ago, that accepted notion has been upended. Amidst anemic sales and burdensome regulations for suppliers, California’s promised cannabis beverage bonanza has yet to materialize in a massive way for small operators like Drippy, and, with consumers beckoning in other states, the brand is keen not to waste time.

Drippy’s solution has been to pick different battles; namely ones outside of California. In pivoting to hemp-derived THC, the brand has retreated from regulated dispensaries in the Golden State. Co-founder Alleh Lindquist acknowledged the brutal economics of a channel not optimized for beverages which left Drippy with few feasible alternatives.

“By the time we were delivering product to dispensaries, we were losing money on it,” he said. “We didn’t have enough capital to truly tackle that market and take it on and sustain the losses that are necessary to grow the business there.”

That means reaching into hemp-derived THC, but aside from that, the drink itself hasn’t changed: it’s still a full-sugar soda experience (80 calories, 20 grams of sugar per can) boasting rapid onset and an elevated body high from the combination of 10mg THC and 10mg CBN per 12 oz. can. 

The move is also a recognition that the heavy users that Lindquist believed would represent Drippy’s biggest fans are just one segment of its consumer base. Feedback showed interest from a much wider audience, including the much-prized “canna-curious” drinkers that Drippy was originally looking beyond. That helped confirm that Drippy’s embrace of art, music and counter-cultural style was working, and encouraged the team to focus on differentiating the brand through direct-to-consumer sales and marketing.

Things were “fast and kind of sloppy” as Drippy jumped into D2C ecommerce back in February, but in the months since, a new website and set of Meta ads has given it a foundation with which to build. After doing around $250 a day in sales prior to the rollout, the brand jumped to doing $4,000 per day in just two weeks, Lindquist said, with some ads converting $4 for every $1 spent. 

BevNET Insiders can access the full story later today to learn how the brand has hurdled production constraints and maintained its D2C muscle. 

With sake’s roots going back to ancient China, the rice wine has been through many evolutions. Now, many brewers are chasing global trends to bring American drinkers into the sake fold. 

🍜 Sliding into the $10 billion RTD market in the U.S. is one way sake makers are hoping to find inroads into American shelves and bars. SummerFall, a sparking yuzu and sake canned cocktail, is going after the convenience occasion and aiming to appeal to natural wine drinkers. The brand is also making its way into casual Asian eateries of all kinds to change the misconception that sake only pairs with Japanese cuisine. 

🥂 Other brands are taking a fancier approach: HeavenSake blends champagne techniques with sake brewing traditions, and – in a down wine market – is aiming to give higher-end consumers and restaurants a different experience but with that same low-ABV, luxury feel. 

🇯🇵 But warming up American palates to foreign beverages has historically taken years and big education budgets, luckily more Japanese brewers and emerging American sake breweries are up to the task.

BevNET Insiders can access the full deep dive.

Fresh off a World Series appearance with the New York Yankees, MLB slugger Juan Soto is one of the most desired free agents in American pro sports this year, so fans and media alike were sent on an emotional rollercoaster when he announced his next team: Celsius.

💬 Soto posted a short video to his Instagram account yesterday of him appearing at a press conference and captioned “The announcement you’ve been waiting for.” In the clip, he says it “wasn’t an easy decision” before pulling out a Celsius branded cap and taking a swig from a can of the energy drink. “What? You were expecting a different announcement?” he concludes.

🧢 Sports media and fans took the “trolling” announcement in a mix of stride and anxiety, with one top comment on the post stating “I”m telling my therapist about this” while others looked for potential clues on where Soto might land, such as the “Yankee blue” color scheme of the Celsius cap (we wouldn’t read too much into that, personally).

⚾ The four-time All-Star has been offered contracts from the Mets, Yankees, Red Sox, Blue Jays and the reigning champion Dodgers. But wherever he ends up, Celsius is sure to be there.

President-elect Trump made yet another statement on tariffs this week, vowing that his first day in office he'll issue an executive order to charge Mexico and Canada a 25% tariff on all products coming into the U.S. 

🗣️ We’ve tackled the implications of tariffs on spirits before, but the Distilled Spirits Council of the U.S. (DISCUS) is now weighing in: “Imposing a tariff on Tequila and Canadian Whisky from two of our largest trading partners could kick off more retaliatory tariffs on American spirits to Canada and Mexico,” read the statement. (Mexico’s president has since signaled that the country is indeed prepared to respond with retaliatory tariffs of its own.)

📝 Under the renegotiated NAFTA (the United States-Mexico-Canada Agreement, or unpronounceable acronym USMCA) Tequila and Canadian Whisky are designated as distinctive products, where they can only be made in their country of origin. Same goes with mezcal. “Slapping a tariff on Tequila and Canadian Whisky will not boost American jobs simply because they cannot be produced in the United States,” continued the statement.

📊 The stats show how linked the trading partners are just via spirits alone: In 2023, the U.S. imported $4.6 billion worth of tequila and $108 million worth of mezcal, and tequila/mezcal supplier sales (a bright spot for the industry) in the U.S. were up 7.9% totaling $6.5 billion. The U.S. also imported $537 million worth of Canadian spirits last year.

🇲🇽 The two countries also represented the second and third latest export markets for U.S. distilled spirits in 2023: exports to Mexico reached $139 million and hit $255 million in Canada. 

Go Deeper: What Does Trump Mean For Spirits?

Walmart is among the latest – and largest – companies retreating from diversity, equity and inclusion policies (DEI), buckling to pressure from conservative groups to “end wokeness in corporate America,” according to NPR. 

⛔ As part of the sweeping changes, confirmed this week to The Associated Press, the retailer will no longer consider race or gender to improve diversity when offering supplier contracts.

🗣️ "We've been on a journey and know we aren't perfect, but every decision comes from a place of wanting to foster a sense of belonging, to open doors to opportunities for all our associates, customers and suppliers and to be a Walmart for everyone," Walmart said in a statement.

Heritage Distilling Holding Company Inc., a spirits portfolio business with an array of whiskeys, vodkas and canned cocktails, has closed its IPO for $6.75 million, several days after it began trading publicly on Nasdaq under the symbol “CASK”.

• Heritage’s portfolio includes military-themed whiskey line Special Operations Select, premium bourbon and rye line Stiefel’s Select and flavored vodkas, in addition to a Heritage-branded line of canned cocktails with flavors like Blood Orange Vodkarita and Gin Jam Fizzzz.
• The Washington-based distillery announced its plans to go public this fall and began trading on Nov. 22.

💬 On LinkedIn, co-founder and CEO Justin Stiefel said: “Proud of our team for pushing through and thankful for our fans and customers for allowing us to get here as the first pure play craft distillery to complete a full IPO.”

Kroger and Albertsons have found themselves entangled in yet another lawsuit after a longtime Colorado grocery store employee filed a putative class action yesterday alleging both chains conspired to suppress workers’ wages, reports Law360. 

📝 The report claims Kroger and Albertsons entered into unlawful no-poach agreements amidst a 2022 strike against Kroger-owned King Soopers by United Food and Commercial Workers (UFCW) Local 7. 

🔍 Earlier this year, Colorado Attorney General Phil Weiser filed a lawsuit to block the proposed $24.6 billion Kroger-Albertsons merger. His suit, in part, also challenges the alleged no-poach agreements. 

👀 Whereas Weiser’s suit seeks to punish the grocers for allegedly entering into the no-poach agreements, the new class action suit looks to recover lost wages for the over 18,000 unionized workers.