Sweet success
HOW TO ENGINEER A HIT PRE- MIXED VODKA COCKTAIL, WITHOUT ADDING ANY SUGAR.
MARKETING THE PRODUCT, THERE HAVE BEEN TWO PILLARS — TRIAL AND AWARENESS. WE KNOW OUR DRINK IS VERY UNUSUAL. THE HARD THING FOR US IS PEOPLE’S ASSOCIATION WITH LIGHT OR DIET ITEMS, SO GETTING PEOPLE TO TRY IT IS CRITICAL. — DAN BEACH, AWARE BEVERAGES
SOCIAL LITE FIT PERFECTLY BOTH SIZE AND AMBITION WISE.
Adesire to be bright-eyed enough for an early gym workout the morning after a night of partying led Kevin Folk and Dan Beach to begin dreaming up mixed vodka recipes.
The friends and business partners behind Aware Beverages Inc. met as engineering undergrads, and had always talked about starting a business together.
“We are both health conscious, both active, and when we went out with friends we would always drink vodka and soda,” Beach recalled, adding they were trying to avoid the type of hangovers associated with sugar- laden mixed alcoholic drinks.
They decided to try to create a premium vodka infused with powerful flavours, but no added sugar — much like carbonated waters infused with natural lemon and lime — and began playing around a few years ago mixing vodka with ginger and citrus in Beach’s kitchen. “We just started mixing flavours and to see which ones stuck,” he said.
“We settled on ginger and lime for one. And around that time I was sitting in a client’s office and a girl working there was doing a cleanse, and she had a big water bottle with cucumber and lemon and mint in it and I thought we should really do something with cucumber.
It took six to eight months to develop those two flavours. With just 80 calories per 355 ml can, SocialLite is one of the few alcoholic drinks in Canada with nutrition information and a calorie count on its label.
“The easiest way to cut back on calories is taking out sugar,” Beach said. “We had an idea that was born out of a selfish need, and we realized we weren’t the only people with the same problem. A typical or traditional cooler has between 200 to 400 calories in 355 ml.”
SocialLite’s development has been unfolding amid the rise of a societal trend that eyes sugar as a health hazard on par with tobacco. Beach points out that the World Health Organization’s new guidelines suggest sugar consumption shouldn’t exceed more than 10 per cent of an adult’s total daily energy intake, and that even a lower intake — below five per cent of an adult’s daily target caloric consumption, or roughly 25 grams of sugar a day — would be ideal.
Following that directive, one’s daily sugar allotment would be blown by drinking a single serving of Mike’s Hard Lemonade, a classic vodka cooler with 32 grams of sugar per bottle.
After developing the flavours, the partners turned their thoughts to the type of vodka they would want to use, keeping in mind that premium, small-batch vodka has a smoother taste.
“Most of the ready- to-drink market uses something called neutral grain spirit which is a low-grade alcohol and typically add a bunch of sugar to hide the flavour of the alcohol, colouring and different flavours.”
The pair approached Still Waters Distillery, a craft distillery in Ontario, and struck a deal.
So far, Folk and Beach have used personal savings of $27,000 to develop their product and secured a $ 190,000 loan from the Business Development Bank of Canada to set up the company and do an inaugural production run. Then came a sought- after pitch spot on the TV show Dragons’ Den last year. And while a spot on the program didn’t result in a deal, former dragon, investor and marketing pioneer Arlene Dickinson kept them in mind and recently came on board.
“A good idea with great, driven entrepreneurs never fades from your mind,” Dickinson said.
“I knew I wasn’t the only one who was tired of the sugary artificial coolers out there, and many of my friends order vodka and soda to help manage their sugar intake while still being able to enjoy a drink. The trend overall is towards healthier and artisanal mix ingredients. People want to have natural, sugar free taste experiences that are also delicious.”
Dickinson, who has invested in businesses from Balzac’s Coffee to a healthier-for you line of snacks, Dr. Joey’s Skinny Chews, invested in SocialLite through District Ventures, her new incubator for entrepreneurs in the food and beverage, wellness and consumer packaged goods categories.
“SocialLite fit perfectly, both size-wise and ambition wise,” Dickinson said. “They have already taken advantage of the desk space, mentors, sponsor assistance and programs. These will all add fuel to their growing business momentum in a meaningful way.”
Dickinson’s ad agency, Venture, will work with Beach and Folk on their marketing strategy and the agency has already helped them with packaging. “Marketing the product there have been two pillars for us — trial and awareness,” Beach said. “We know that our drink is very unusual. The hard thing for us is people’s association with light or diet items, so for us, getting people to try it is critical.”
After sampling at one Calgary liquor store, SocialLite sold 120 four- packs in less than four hours. Beach said the sampling success rate — those who buy after sampling — at some stores is 70 per cent.
SocialLite has distribution in 200 stores in Alberta and private stores in B.C., where Beach and Folk are trying to get into government stores, and it will be available at the Liquor Control Board of Ontario this spring.
Those three provinces account for 70 per cent of the ready to drink alcoholic beverage category of sales in Canada. “Ideally we will be in most, if not all, of the provinces,” by the end of 2016, Beach said. Once that is accomplished, the partners will look to expand into the U.S. and abroad.
Projected sales for 2015 were $ 250,000 — five times the previous year’s sales. Folk and Beach expect growth to continue after adding distribution this year, forecasting sales of $ 2- million in 2016, $ 5- million in 2017 and $10-million in 2018. The company is breaking even, and the founders expect to turn a profit this year.
Recently, the pair received a grant from the federal government’s National Research Council-Industrial Research Assistance Program to go back into the lab to develop new flavours.
“We are looking at citruses — blood orange and grapefruit — with some type of herb,” Beach said.
“We’d like to have a tradi tional ingredient and a non- traditional ingredient. There are some different elements you can add to drinks, whether it be sweet or sour or spicy. We’re going to evaluate a number of trends and see what flavours people enjoy.”