‘Empathetic’ Market Strategy Drives Outsize Growth for Beverage Bai

‘Empathetic’ Market Strategy Drives Outsize Growth for Beverage Bai

Beverage brand Bai has experienced meteoric growth since its 2009 founding, significantly by following a market strategy that focuses on empathy with consumers and distributors. In 2015, an Inc. profile reports Bai’s three-year growth at 2,210%, for 2015 revenue of $119.9M. In 2015, Forbes ranked Bai No. 13 in its America’s Most Promising Companies list. And this year, Bai earned a Breakthrough Innovation Award from Nielsen.

But it’s possible you’ve never even heard of Bai. Founder and CEO Ben Weiss says about his company:

“We've been able to build a $125 million company, and only 7 percent of people have ever heard of us…. When I created Bai, I went to health food stores and set up my folding table and learned what consumers loved and didn't love about the brand…. Selling at Costco is a week of 10-hour road shows on your feet. Most brands our age wouldn't do those road shows, because there's nothing glamorous about them. From the outset, we never took the fact that we have a fantastic brand for granted. We were very patient in an industry that is notorious for not being patient.”

If you haven’t seen the product, you soon will. Bai secured a national distribution agreement with Dr. Pepper Snapple Group. As with any successful brand, though, this success did not happen overnight. Bai took the time to build brand awareness, loyalty and retailer relationships by thoroughly understanding both consumers and distributors.

Understanding How Consumers Feel about Beverages

‘Empathetic’ Market Strategy Drives Outsize Growth for Beverage Bai

Bai is heavily focused on consumer research, specifically on identifying consumer pain points with existing beverages. The brand’s product portfolio has been carefully designed to provide “beverages with no barriers” that address consumer discontent with existing beverage options:

  • Juice: Antioxidant Infusion and Cocofusion
  • Soda: Bai Bubbles
  • Water: Antiwater
  • Tea: Antioxidant Supertea

Weiss describes the product strategy:

“If you look at our product line and also our source-of-volume data, there’s structure and symmetry. There are products that pull, variously, from sodas, juices, waters and teas. We’ve identified trade-offs associated with each of these alternative beverage categories and offered options—in the form of enhanced waters in a variety of flavors, both carbonated and flat—that are beverages with no barriers. To me, and I think to many of our consumers, the magic of Bai is that all of their other beverage options have some sort of trade-off, whether it’s too much sugar, or not enough taste, or artificial additives or too much caffeine…. Once you see the beverage landscape as consumers experience it, the idea of a ‘beverage with no barriers’ is
a big idea.”

Adapting the Strategy Based on Market Feedback

The brand evolves fluidly when compelling research gives good reason. Originally, Bai was a mid-calorie beverage. Promotion highlighted the antioxidant properties of its signature ingredient, coffeefruit (The ‘superfruit’ pulp that surrounds the coffee bean, and is usually discarded in production of coffee).

When the company released a five-calorie option, it soon became clear consumers preferred low-calorie options, and Bai dropped the mid-calorie product. As consumer confusion grew surrounding the inclusion of coffeefruit (Does it taste like coffee? What the heck is coffeefruit?), promotion of the ingredient was dropped from packaging.

Current marketing strategy highlights the “beverages with no barriers” benefit, as seen in this example from Bai’s the “None of this makes sense,” campaign:

Understanding Retailers and Building Trust

Bai values “distributor equity” as much as brand equity. This strategy strives to make Bai “a huge win for our retail customers,” and includes growing relationships with retailers, constantly improving in-store execution and offering a reliably great consumer experience in-store.

In its first few years, the brand chose reliable growth with core retailers in the Northeast like Costco, Target and Safeway over broad distribution that would put its ability to execute in jeopardy. It earned credibility with retailers by conducting marathon Costco Road Shows, which Weiss described as decidedly, “unsexy.” This “repeat after trial” strategy also allowed the brand to stand out to consumers in the crowded beverage marketplace. Through this regional success, Bai earned a distribution deal with Dr. Pepper Snapple Group in 2014.

By empathizing with both consumers and retailers, and adapting its strategy based on market feedback,  Bai has been able to deliver a product and experience that resonate with both. As the brand’s results show, this market strategy was a clear path to success.


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    Michal Clements

    Michal is co-author of Tuning Into Mom and an experienced consultant. Michal develops winning growth strategies and detailed go to market plans for some of the world’s outstanding organizations including McDonald’s, Gatorade, Abbott, Barilla, Tylenol, Clorox, Key Bank, Eagle Ottawa, Quaker and the Baker Demonstration School.

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