The Technique That Broke Celsius’ 10-three hundred and sixty five days Scamper

I've never been a huge energy drink guy,but there's one I can't stop seeing. I know this one has crazy action sportsand everyone has some idea of who drinks this. But then, there's Celsius. It feels different. It doesn't reallylook like an energy drink. And in the last few years,it's everywhere. And I think that Celsius is a buy here. Whats up, I'm Gio.

And I drink Celsius! I was instrumentalin Celsius, Has anyone ever tested Celsius for methamphetamines? Celsius essential. Just a decade ago, Celsius was doing so badly,it was delisted from the stock exchange. It was on the verge of bankruptcy. But the company is now worth around $18 billion and is the fastestgrowing brand in the energy drink market. This is a story of how branding fresh teamsome luck Celsius from a little known weight loss drink in Floridaan international beverage powerhouse.

It's the early 2000s and this is what a can of Celsiuslooks like. Burn calories,reduce body fat, build lean muscle. And then finally,they get to lasting energy. Before Celsius became what it is today, it was barely marketed as an energy drink. Instead, it was an ideaby a couple from Boca Raton, Florida, to break into the $36 billionfunctional food and beverage market If you look at the company's websitein its early years,.

The drink had basicallythe same ingredients as it does now, notablylots of caffeine and no sugar. But they didn't call it an energy drink. Energy drinks have been with us for a long time. And, Red Bullwas really the pioneer in that space. And if you think about brand positioning,they were very clever, with the tagline of giving you wings,but also giving you this emotional energy, this confidence, Unfortunately, they all follow each other. So that's where we get into the erathat you're talking about,.

Where some innovators startedlooking at other ways to position this. And this is what Celsius choseto position itself as. A kind of magic health drink meant to fight the obesityepidemic. And very prominently, Celsius places itself as a drink that burns calories. To prove it Celsius paid for several studieswhich it still cites that tracked its supposedly health benefits, Specificallythe studies assessed the drinks thermogenic properties,which are basically its ability to heat up your body and burn calories caffeinealone is a significant contributor.

To this effect. Regardless Celsiuswas the first drink brand to use the word thermogenesis as a marketing tooland sold itself as a drink that burnt calories for youright as they're getting started. Celsius gets a new character in its story,Carl DeSantis. He's this old billionairewho made most of his fortune selling vitamins,and he lives near the founders in Florida. One day he is handed a case of Celsiusand immediately smells profit. He quickly made huge investmentsin the company and in 2008 helped take Celsius holdingspublic.

Here at the big board. The company immediately dumped moneyinto advertisements like this one the calorie burningdrink the burn, baby, burn. But all they were burning was cash. By 2011, the company continually reportedbigger and bigger losses and stagnating revenueand the stock tanks. people who triedthese functional beverages expecting to see big results in weight lossdidn't find them. it just didn't look likethey had really crystallized.

How they wantedthis brand to be perceived by consumers. Eventually in 2011,at this point, a penny stock after IPO at $16 Celsius delisted from the Nasdaq. And conspicuouslythe company makes some big changes. Seeing his investment is flopping, Carl Desantis forces out Celsius Management. And for a year and a half, the companyapparently went dark and didn't run marketing, and it practically disappearedfrom store shelves. But then in 2012, DeSantis startedpulling in his own dream team. This included a new CEO, Jerry David,who was known as the Turnaround King.

A different guy, John Field Lee,who later becomes the current CEO and the former president of Coca-Cola. The company also sought wisdomfrom a marketing guru named Jack Trout. quite a legend in the marketingand communication space. He's known as the founder and pioneer of these things called positioning theoryand marketing warfare theory. How was your productor your brand positioned? And then how do you defend that position? So in that sense, it is like warfare.

We had the cola wars betweenPepsi and Coca Cola, in taste tests, most consumers really couldn't tellthe difference between the two beverages. So really, the battle lied and what theyperceived about those two separate brands. in much the same way, Celsius tried tocarve its own space of perception in the And this was the start of the Celsiusthat we see today. Over the next several years. The company analyzed why it wasn't sellingand found a few big things First they really focused onwhat they called drilling deep. Instead of expandingto every market possible,.

They chose to constrict back to sixmain areas to master, focusing on how to get customersto buy again and again. once they mastered their strategy,then they would expand. Second, they rebranded their packagingand adjusted the way they marketed their product. while,this meant doubling down into weight loss. But then, as their currency, CEO said”we realized we had a great, amazing energy drink on our hands”and to make this energy drink stand out. They shifted its positioningto feel healthy,.

Not just claim to be on the package,though they still do that in a lot of placesas well. The brand itself in terms of toneand color and style gets really light. this was a categorythat was pretty hyper masculine. Celsius went the other directionand took this to a degree that didn't feel likeit was all about sort of disruption and rebellion. Through this departurefrom hypermasculine marketing, Celsius was able to achievea 50/50 gender split among its customers, which was very unique to Celsiuswhen compared to competitor brands.

To make buying a Celsiuseven more approachable, they started selling individual canswhich allowed consumers to try it out. Then lastly, Celsiusreally bought into the fitness world and came to embody a healthy lifestyle. Hence live fit. You'll see it around your salescycles, your berries boot camps. it has become a pre-workoutgreat drink for a lot of folks. so at the end of all of this, Celsiuswent from a calorie burning functional beverage to a healthyalternative in the energy drink market.

Celsius is turnaround. King effectivelypulled the company out of its slump seeing his work there was done. Gerry David leaves and in 2017Celsius joined the Nasdaq once again, and in 2018, John Field Lead, the CFO, got upgraded to CEO. Slowly but surely,Celsius took hold on American culture. We saw famous peopleholding in an Instagram post. And meanwhile COVIDgot people caring about their health. Which Celsius is brandingperfectly tapped into.

So at this point, people really wantto get their hands on a can of Celsius. but it took one thing out of their controlto really break through. in the beverage industry. if you can't get distribution, you're always going to be a very smallniche brand to really make it big in the beverageindustry, companies ultimately need to get mass distributionAnd the main way to do this is linking up with a big distributor and joining their established network,which also brings several other perks.

You really can't getwith local distributors. But getting into one of these networksis really tough. each distribution truck only has so much space. This is where Celsius got lucky. BeforeCelsius made its big moves,Bang energy was in a very similar spot. It had a giant list of regional distributorswithin the Anheuser-Busch InBev network when it jumped over to Pepsifor an exclusive deal.

So suddenly a bunch of these InBev truckshad a Bang energy sized spot open for another player. These distribution trucksare driving to their stores regardless. So they're incentivized to fillthat empty space in the truck and then on shelves, ideally with a drinkin the same market segment. So right on the heels of earning recordprofits in the second quarter of 2020 Celsius, snatched a bunch of these spotsBang left. And Celsius' stock starts skyrocketing. then in 2020, once againpaving the way for Celsius, Bang left.

Pepsi. Two years later, in 2022,Pepsi made a $550 million investment in Celsius to get a near exclusivedistribution deal with them. Through this Celsius,was able to streamline its distribution and get in a lot more places, Once you get into the store,you also want to get on the right shelf. And that shelf spaceis valuable to the retailer. If you can't turn enough product, they're going to put a different productin that location. But if you're a big brand like Pepsior Anheuser-Busch.

You have a lot of clout with those folks. If I'm going to get into thosefancy end caps or do anythingthat's going to try to get your attention for Super Bowl,they're the ones doing all of that. So if you come to the official energydrink section of this store. Celsius only has these two spotswhich are empty, but one. But if you go around the corner, they have this. When you have a big playerlike InBev or Pepsi, they can.

They can make those things workbecause the retailer knows if it doesn't work,they'll make them whole And that's what that allowssome of these brands like Celsius to get to the scalethey have today. so with Pepsi, Celsiusgot exactly what it wanted. Now they're in tens of thousandsof convenience stores, grocerystores, gyms and health shops. This is probably around the time you feltlike Celsius just came out of nowhere from its beginnings as a functionalbeverage to a genre defining energy drink.

Celsius is a cast of charactersbuilt a brand that now takes nearly 6% of a crowded energy drink space,which, though a low number is third place and $1.1 billion in sales in 2023 and Celsius continuesto add more flavors and product lines with remarkableprofit increases year over year. but we've also seen that fast risesdon't guarantee steady success. And in January of this year, despiteprofit increases of 336% in Q4 of 2023, Bank of America downgraded Celsius stock from buy to neutral, as analystsworried the company's.

Exponential growth is dwindling,the stock corrected in response. Beyond slowing earnings, recent congressional challengesto caffeine consumption by children have raised concernsfor the growing energy drink market as a whole,which is often advertised to youngsters. But exactly how much this will affectcompanies like Celsius is still TBD. Also, competition is always hotand ever changing. Looking at the energy drinks sectionof any store will prove this very easily. Companies dominating the market likeMonster and Red Bull don't want to budge.

For example, Monster released a zero sugar version of their usuallyvery sugary drink to draw in Celsius is health conscious consumer,and Red Bull is still very far ahead. it's clear Celsius has found its momentum. And it seems like they're holding strongto their playbook. The company recentlyannounced that within the next two years it will expand its global salesand distribution to international markets in France, Australia and New Zealand. But when you're selling a story, you neverknow when people might stop buying it.

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