In 2014, three entrepreneurs went on Shark Tank and secured a $1 million investment from Mark Cuban for their party punch Beatbox Beverages. The wine-based portable drink is 11.1% ABV and the 5-liter package contains the equivalent of 34 mixed drinks. Now, the company is offering an extension called MixTape, an individual-sized 500-ml. version of BeatBox. With the equivalent alcohol content of three mixed drinks, MixTapes sell for a suggested price of $2.99-3.99 each.
I recently spoke to BeatBox Beverages’ CEO Justin Fenchel, CXO Brad Schultz and COO Aimy Steadman about the brand’s expansion and what’s next for BeatBox.
Beverage Wholesaler: What’s the most recent news for your company?
Justin Fenchel: The big theme of this year is our brand new product line, MixTape, which we call the world’s first adult juice box. It’s a single-serve option that joins BeatBox, our party punch that’s now in 500 Texas accounts and will soon be available at WalMart. We’ve been hiring an amazing team of people from the distribution world, filling out our team to explode sales of BeatBox and launch MixTape.
BW: What’s the difference in the distribution model and the consumer demographic you’re trying to reach with MixTape and your original product?
Brad Schultz: After starting with RNDC in Texas, we quickly expanded to California and Florida, and now we’re in 18 states. A lot of people who saw us on Shark Tank have been waiting for us to get to their state, so everyday we’re seeing email requests for new stores.
Justin Fenchel: In terms of demographics, there’s definitely a difference between the two products. The five-liter has been popular with younger Millennials (21-25). It’s great for parties and the beach because it has no glass. The individual product, MixTape, has a much broader appeal because it can be purchased for personal consumption.
BW: What have been your biggest challenges as you’ve expanded?
Brad Schultz: From a distribution perspective, the reason we’re hiring is to help navigate the distributor world and make sure we have share of mind. And it’s also about awareness – we’re creating a new category and new consumption format, so that has to be conveyed to the consumer at the point of sale. Getting distributors to work for us, and getting consumers to know who we are have been our biggest challenges.
BW: Are you targeting big box stores for retail sales in the markets you’re entering?
Justin Fenchel: A lot of our success with BeatBox has been with those types or stores. If you’re going to make it in this industry, you ultimately need chain support. So as we show that we have regional success, we’re taking that data to bigger and bigger chains.
Aimy Steadman: MixTape is helping us penetrate the convenience store channel, which we couldn’t do with the five-liter product because it was too large. With single-serve, we can open a lot more convenience accounts, which we’ve already started doing in Texas.
BW: What regulatory hurdles have you overcome during the first couple years on the market?
Brad Schultz: Regulations are crazy – each state you go to is like launching in a separate country. In Florida we couldn’t sell a five-liter size, so we had to create a special three-liter version. We’ve been trying to figure out which stores carry which beverage categories, and where we want to be placed within the store. We’re wine-based, but we don’t attract the traditional boxed wine consumer. So we want to be with spirits and RTDs and other party products, as well as in the cold box. It’s always challenging to push our distributors to ensure we’re in the right places.
Amy Steadman: One thing we’ve looked at for MixTapes is working with beer distributors, because they’re in convenience stores more often – sometimes every day. But of course some beer distributors can’t sell wine, and some choose not to as a business decision. But it’s definitely something we’re looking at closely.