Full of energy

Up to Leeds and the home of BOOST Drinks, sited outside the city on a large and pleasantly landscaped industrial park. There is no factory here, because BOOST’s energy drinks business model outsources production, as it also does the logistics, leaving the merry band of BOOST-ers at head office free to concentrate on refining, innovating and marketing a vibrant brand that is one of the true impulse channel originals, and still exclusively available within it.

The legend is that, like Apple Computer, the company – Simon Gray’s bold brainchild – basically began life in a garage (a version of what they proudly remark about projects in Yorkshire: “Designed in a pub. Built in a shed.”) Of course, that’s not the whole truth, but it’s not far off. Twenty years later – the anniversary was last November – volumes have grown, alongside double-digit jumps in turnover, which took the firm to over £27m, with £50m in 2022 a realistic target after the new distribution deal with Rio.

“It’s been a huge transformation,” says Gray, as we settle into his office, “not just for BOOST but for energy as a whole.”

Back in 2001 the category was much narrower, even slightly moribund, and that was where Simon saw his chance. I say that I read how stimulant energy is now the largest soft drinks category, in impulse, anyway, with stimulant shoppers spending 92 per cent more than other soft drinks shoppers, so these are fans who repeatedly and loyally purchase their favourite energy boosters.

“There you go. In 2001 it wasn’t even a category and was quite different to the stimulation energy market as we know it now, which is, gosh, something like 30 per cent of the whole soft drinks market. It’s massive.”

What was the cause of the change – or rather the amazing transformation?

“Even when Red Bull came along, I don’t think they had the vision of where they were going to be today. But lifestyles were changing, 24-hour shopping was starting, and convenience living was the big thing.”

Proudly Yorkshire

BOOST is a brand that grew up with the category, and with the channel itself, so different to what it was two decades ago. And part of BOOST’s identity and appeal is also that of the convenience channel, its heart being in the neighbourhood, so to speak.

The slogan “We love local” is right there in huge letters on the outside of the BOOST building. You were a local lad, I say to Simon. You stayed local, you’re locally loyal, you went to Leeds Metropolitan University and started your career here Leeds, too.

“Yes, I’m a Leeds lad born and bred,” he says. “I was the energy drink drinker, and I was the shopper when I was at university, when the category was just in its infancy. I came out with a business degree and I ended up working for a food wholesaler.”

This was the only time in his life, as it turned out, that Gray would be an employee as opposed to an employer. He quickly got itchy feet.

“I set up a small food wholesale business myself for a year or so, which was more like a lifestyle job, and then met a few manufacturers along the way through normal trading business. I approached them about trademarking a brand as the category was growing. And our original launch was a one litre bottle of energy, so it was like four cans of traditional 250ml Red Bull-style products in a bottle for a pound. So as a consumer, as a student, you’re thinking, ‘Well, I would buy it.’”

That very first BOOST sku was definitive: it came on the back of a bigger brand, went beyond the format and gave great value that set it up as a serious competitor from the get-go.

“I felt like I knew what people wanted and, while I guess the taste profile was key, because I was the student, I was really looking at a better value-for-money proposition.”

Even today, the bargain BOOST price, just like the convenience-channel availability remains a key part of the brand profile.

“My parents were in business, and I guess I’d grown up around that value-for-money principle,” says Gray. When I approached the manufacturer and said that this is what we wanted to try and pioneer, the convenience sector generally was where people were shopping energy, so it lent itself naturally to convenience retailing.”

Gray is super aware that the first BOOST drink “had no divine right to succeed”, and he had no sales team to help it do so.

“But we had some sales agents that we got introduced to and they started carrying our brand. They knew a lot of the local wholesalers, the East End Foods, the Hyperamas, and would recommend our product, and these wholesalers were looking to develop a category, and saw something a bit different in BOOST.”

Where did you get the name, incidentally?

“I should also give a shout-out to my wife here,” Simon laughs, “because it was probably only 24-48 hours before we launched, she suggested we changed the name of the brand from Blast to BOOST. It was going to be called Blast originally. And the rest is history. “

The history is one of steady success, built on a reputation for witty, brash promotions and a presence centred not so originally on the consumer, but on the retailer visiting the cash and carry warehouse. Wholesalers got to know and respect the brand early on, and it spread from there.

“It started in convenience retail with local independent wholesalers, and then from there it scaled up to some of the more national operators, so Nisa came on board quite early; Bestway came on board, and it started to give us more of a national footprint.

It is partly thanks to BOOST that energy and convenience have come together like a horse and carriage. Gray estimates that fully 75 per cent of energy drinks volume is bought in convenience retailing. It’s a successful, home-grown category that is now a central pillar of the channel – and they did it without ever having to worry about the mults. And that comes down to Gray’s agile and savvy business model.

The perfect model

“We’re not the manufacturer so we’re not just chasing supermarket volume to turn machines over,” says Gray. “It’s quite a virtual model. I guess there’s lots of brands now that are using co-packers rather than doing manufacturing themselves. We’ve always put our trust in people that are very good at what they do. We’re pretty good at brand building and connecting people, and that’s what we’ve done. We’ve nurtured relationships over the years. If I have one skill – not a superpower, but a skill – it’s bringing together people in all the departments that are better than me at what they do, because I’ve done all the jobs over the years.”

He sees how successfully the model works, allowing the business to grow without getting bogged down in plant and capital. “Yes, you need more space, you need more trucks, you need more suppliers, you need more pack formats. But the principles of having something that flexes, especially in a world where you need agility, has stood us in very good stead.”

BOOST, like the impulse channel, did well during COVID, and Gray has spoken before of the changing customer landscape ahead of us. How do he see things changing now we have emerged from the pandemic, but perhaps into the path of an oncoming recession express train?

“Food and drink generally is not untouchable, but it is fairly recession proof,” he says. “I think the last recession was different because the whole world hit a wall, and it was unheard of. And we kicked on as a brand in that recession, a bit like Gregg’s, Primark, EasyJet and all these kinds of brands that weren’t built for the recession – Aldi was the number one example.

“Thinking about the end of this year and the recessionary impact, I think it’s going to affect everybody to different degrees, and I think the people at the lower end of the disposable income scale are going to be hit harder with this one. But people are still working, they’re still doing stuff. The days are getting harder, longer, so it’s about functionality. This is where BOOST plays its role, getting you through the day.”

Gray says that shoppers want value but also, now, health and well-being are important, meaning these items are probably more on the radar. But he says that in the short term, availability seems to be vital.

“As long as you can get it to a consumer, they’re almost happy to pay a premium as long as they can afford to pay the premium,” says Gray. “That will be interesting to watch over the next few months. But as a as a value-for-money proposition. I’d like to think that we can offer people choice, and we can possibly bring people into the brand where they have never shopped with us before.”

Doing right by Rio

It’s likely that BOOST Drinks’ fortunes will prove counter-cyclical, again doing well in the downturn. The recent Rio tie-up is a case in point. It is BOOST’s first distribution deal, allowing the company – which now operates as a happy challenger brand in the four areas of energy, sports, coffee and protein – to move across into fruit soft drinks.

“I suppose I saw our vision was to be in all sorts of functional drinks and we’re always looking to be the challenger brand to whoever the market leader is. So we’re starting off with stimulation energy, we then move into the sports drinks, and then Starbucks when they pioneered iced coffee, Monster …”

Gray’s attitude is that while those brands tend to play in one category, BOOST plays across them all: “Because the same consumer is probably looking for different products for different needs states,” he explains.

“That was the brand side of what we do as BOOST. With Rio it was a bit different. We’d started to think about the partnership concept to grow our business model, and also to take out some cost and spread some synergies across the supply chain. Also, we were thinking about brands where potentially we could offer a leg up into convenience retailing because of our supply chain and our network of contacts.

“With something like Rio, it offered us leverage into food service, because they’re a big food service player. So that gets us into wholesalers and into customer conversations that we weren’t in before. So it worked both ways. The beauty of this one is, it had a decent amount of scale that it brought to the conversation. You become more of a scale player within soft drinks when you’re talking to, buyers. Then, when you’re talking to the supply chain side of businesses about logistics, you can bring umpteen pallets of this and a few pallets of that. The whole thing just scales well.

“But the biggest beauty of it all is that it’s made in the same manufacturing plant [as BOOST], which we didn’t know about! What I did know about – and this is why there’ll probably never be another one that’s as perfect as Rio was – it was also warehoused in the same logistics operation as well.

Jackpot!

“Yes, it was almost set up for us, we just had to harness it. And that’s been great. The trade have taken to Rio and they recognise the branding, even though it’s not had a huge amount of love given it in recent years. And that’s where the marketing team and the sales team can really drive it.”

He says that despite this success, BOOST is not looking to employ a full-blown brokerage model. “That’s not what it’s about. But if there are potentially at times one or two brands that complement what we do, can be incremental to what we’re trying to do, don’t bring too much complexity, because it’s quite a simple SKU portfolio as well – then yes.”

Stay sweet

The BOOST operation is beautifully streamlined. It’s distinctive, it’s coordinated, the pricing is coherent, it has its appeal, and it is loyal to convenience. I wonder whether Gray sees the brand staying in convenience? Is Rio much in the mults?

“Rio had a bit of history in the mults,” he says, “and we need to work with those guys on a brand plan for the mults. But for us, convenience is what we understand. It’s where the action is at, and we see great opportunities, we’re winning business all the time, new shoppers coming into it, new retail listings within convenience – we’ve had some great business wins in the last year or two.”

Convenience it is, then. For two decades BOOST been a big part of the channel’s vibrant growth, but how long can it boom for? How does Gray see soft drinks changing? Rio, for example, is not like a fizzy pop, it’s a fruit-flavoured sparkling spring water, indicative that the whole category has changed somewhat, away from sugar towards natural ingredients, artisan products, energy, away from the old-style pop.

“Clearly there’s a there’s a long-term agenda in terms of health and well-being,” he agrees, “but life is getting tougher and people still have needs. And interestingly, even though we’re below the sugar levy with the all the BOOST brand products, within this category sugar is part of the energy.

“It’s a slightly different proposition to traditional soft drink because you’re using it as part of your day, and you’re driving further, you’re burning calories doing sport, whatever it may be, and I think people know that sugar is in it, and as long as it’s managed effectively, it’s no problem.

He believes the challenge lies in education. “Because these aren’t just soft drinks. If you just drink one [BOOST] every day, yes, they have calories, even though they are reduced calories below the sugar tax, but they help drive you through your day and get through more.”

In other words, shoppers have minds of their own and there is a limit to the nannying by the state, even if people are prepared to be sensible and listen to advice (rather than orders about what they can and cannot consume).

“You asked about the stimulation category,” Gray says, “and you might have thought a couple of years ago, that it would be maxed out. But then bigger formats come out, new, interesting flavours come out, the concept of gaming got driven on, and arguably now people are working harder and longer just to stand still. That means these kinds of products are coming more to the fore.”

And the category is adept at absorbing and synthesizing and giving expression to changing lifestyles

“Where we’ve moved into iced coffee, it’s become the fashion and the coffee shop culture is booming,” he explains. “Well, it’s just stimulation, just caffeine in another form. So I guess it’s evolving but at the same time, I think our marketing director told me the other month, is that there’s only 20 per cent of the population actually engaged with the category.”

If that’s the case, then the sales parabola is barely off the X-axis.

“When’s it going to stop? Long may it continue, but we’ve got to evolve within it. Like I say, we keep taking sugars down, we keep making sure that packaging is the right format. We’re always looking at where we can do things more excitingly and differently, all those types of things. So yeah, I still think there’s a lot of mileage in the tank.”

Totally Juic’d

About a decade ago, BOOST ventured into smoothies, but soon left. Even so, fruitiness remains a powerful draw, and that’s where Juic’d comes in – combining energy with sheer fruit power., but it also fits in with a slightly gentler image of energy that fits with an ageing – and widening – consumer demographic for the energy sector.

“I think you’d be surprised, from an impulse perspective, at the number of people who are drinking something like this,” says Simon. “The gaming fraternity or people working at home these days. A 500 ml can just get you through the day. The one litre bottle is a more resealable one. It’s for the fridge. It’s for van drivers, commuters, that kind of thing.”

Way beyond The Valley of the Teens, then?

“The student mark is our entry point,” he says. “That’s what we focus on. And again, I suppose I was the student. When we go back to the question of how big the category can get, the 20-odd-year-olds of 20 years ago are now 40-odd-year-olds. That means where it was just 20-year-olds in the category it’s now 20- to 40- to 50-year-olds.”

Gray says that right now, he bulk of the marketplace remains 18- to 30-year-old, male and female. That’s where the heavy consumption is, and the market is growing – and getting more competitive – all the time.

“You’ve got to stay, on the front foot,” he says. “We’ve got a lot more shopper data now, which means we can see when people are doing things, why people are doing things, how they want to be doing things, but It’s about getting the balance right.”

Staying on the front foot means being visible, and BOOST has always been good at that – was that the secret sauce that helped the brand establish itself as different from the mainstream?

“As a private business and a challenger brand you have got a bit more creative licence. We’re answerable to nobody, but as a challenger brand, you’ve got to be able to cut through. Some brands, cut through harder than we do. I think we have our moments, and I think we cut through really well in wholesale.”

I tell him that it all looks as if it is going wonderfully to plan.

We have found things that work for us,” says Gray. “Our activities have grown bigger and better, the stuff we do in cash and carries is great and we are told it is best in class. Our purpose as a business is energising everybody in every way.”