Javier: Hey there beverage enthusiasts. My name is Javier Morquecho, and I'm the founder of specialtysodas.com, one of the largest craft soda and specialty beverage retailers in the US. As well as this Specialty Sodas Podcast where ambitious entrepreneurs and leaders in the beverage industry come to share their story. My mission is to build a community within the beverage industry so that we can all learn and meet from one another and connect for meaningful relationships.
I'm joined today by Jon Gunnerson, CEO at BAWLS Acquisition and also the CEO at Solvi Acquisition, which are two separate privately held companies operating out of Twinsburg, Ohio. BAWLS Acquisition owns the BAWLS Guarana brand, and Solvi Acquisition owns Crunk Energy. These two drinks and brands are probably some of the most energizing beverages out there.
Hi Jon. Welcome. Thank you for being here today.
Jon: Javier, thank you very much for having me and having the opportunity to be participating in your community.
Javier: Thank you. So let me first start off by saying that today we'll talk about BAWLS Guarana, and in the future we can talk about Crunk Energy. The two companies are truly two separate brands and represent two different types of consumers and markets.
For today's conversation, I want to focus on a few key elements. Private creation and development, route to market, marketing and sales strategy, as well as infrastructure and business planning. So this may be a lot to cover, but we'll do our best. Does that sound good, Jon?
Jon: Let's get the ball rolling.
Javier: So for those of you who haven't heard of... or for those out there who haven't heard of BAWLS Guarana, can you tell us what it is?
Jon: BAWLS Guarana is a highly caffeinated soda, and it's a unique difference maker between the soda and energy drink category. You'll find this placed in that middle road, providing fuel for the consumers and alternative to coffee or an energy drink.
Javier: So BAWLS actually started back in 1996. Can you share a little bit of the story of how it got started?
Jon: BAWLS was really created as an alternative to coffee. Back in those days, this was before the whole energy drink explosion occurred with Red Bull coming to the market in '97 and the rest of the guys joining the fray in the early 2000s. So in '96, '95, '96, there was really coffee. There was something called JoCola, and then some of the other options within the soda or tea range.
So BAWLS was created as an alternative to that and was also an opportunity growing our guarana as a guy from Ohio would say, had been around in South America, was an opportunity to bring that as a unique flavor and fuel to the United States.
Javier: So can you tell us about the name? What does the name mean?
Jon: Bounce like a ball. It gives you enough energy and fuel. That was really the inspiration of it from my understanding. I'm not the founder, but that's my understanding. Bounce with BAWLS was really our one key tagline for quite some time.
Javier: So early on, it became really popular with gamers, and gamers would drink BAWLS at their LAN parties, and that's Local Area Network parties where they link their computers together and play games. So how has BAWLS supported the gaming community early on? And now that BAWLS has grown to a really big company, how do you still remain connected to the community?
Jon: And I appreciate that we're not quite a big company yet, but the gamers really adopted BAWLS as much as BAWLS has adopted the gaming community, and it was a unique partnership. I think they were looking for an alternative to drink and give them some energy. They loved the taste and they loved the performance of the product. And if they could drink it, it would keep them sustained and fueled without some of the crashes that they might get with some of the other beverages they were trying at the time.
So that was the link up and they've been extremely loyal to BAWLS. They have fun with it at the games, at the LAN parties and at other gaming, and we love their support. We want to try to support them as much as we possibly can. We try to stay connected to them by continuing to just support as many LAN parties and events, big and small, as we possibly can each day and each year.
Javier: And so you're the CEO at BAWLS Acquisition. You joined the company in 2012, so it's three years, almost four years now after you had a long career in the retailer industry. So what's your current role as a CEO at BAWLS Acquisition? Why did you join the company? And what are you trying to accomplish?
Jon: My role is obviously very diverse when you're in a beverage company that has a number of different challenges and opportunities out there. But why I joined the company, I'll give you a quick story. Before I joined the company, I went to... I lived in Houston, Texas. And I went to QuakeCon and I visited QuakeCon which is largest Bring Your Own Computer, BYOC, LAN party in North America, 12,000 people gaming. And I saw BAWLS as the official beverage there.
And what I saw was just an incredible... at the time for me, it was overwhelming how much support and how people loved the drink. I loved the taste. I respected that the product did taste good, so I thought there was a great opportunity there which is why I joined the company in 2012.
Javier: So what do you feel that your biggest contribution to BAWLS has been?
Jon: I think, first, I've added some great teammates to the team in operations and marketing and corporate sales. And also then, I think I've just tried to keep us focused very easy every day when we get challenged with a number of hurdles and/or opportunities that are out there for us to try to stay focused. When you have a small team and you're trying to sale across the entire United States, we have to pick and choose our sponsor times and I try to keep us on track.
Javier: So you talked about focus. How do you stay focused and how do you determine what your priorities are for the company?
Jon: I think early on, we recognized the strength within the gaming community. At one point in time before we acquired the brand, there was Paintball and BMX biking and fashion shows and a number of other marketing efforts. We rained it all in and we really have targeted the gaming community. Obviously it is one of the fasted growing industries in efforts out there in the world today. So probably a good choice for us.
But it also was, we'd love to be everywhere, but we just knew we could... so I've rained that in and really focused us on that. And then just try to target also what markets we can be successful in at retail and what not. One of the biggest efforts was to launch ad online efforts as well.
Javier: So one of the questions I get from people is they want to know, how can you scale the business? So when you came on, you did a number of things to help grow the business, online being one of them. What do you do to scale the business from where it was when you joined the company to where it is now?
Jon: I think it's setting out goals. We immediately established sales plans of what we wanted to target, and the first couple years were hard getting to those. But after a point in time, you have to set targets and that might be at the state level, by state, and then for the online. We set goals. We set a benchmark of what we wanted to accomplish, and then what was it going to take to get there? In addition then, we budgeted towards that.
So once we've set that sales goal, then we're able to create budgets as whether it's marketing budgets or distributor incentive programs that will help us get there.
Javier: So here you just mentioned distributor incentive, what kind of incentives are they?
Jon: It might something where it's a cash incentive to get the distributors who are out selling our product up and down the streets to get it on the shelf, or it might something where we just had a group of four go to a Seattle Mariners game and sit in a lottery box that we were able to provide, something along those lines. What's going to get their attention to help us try to expand our distribution?
Javier: So when you're expanding your distribution and you're bringing BAWLS to a new region that has never experienced it before and you're working with a brand new distributor who hasn't also experienced it, how do you get them excited behind the brand and the mission of the company and to really be able to push it out to retail markets?
Jon: You have to have a distributor who is organized with bare efforts. They have to be focused as well. Again, that commitment for a distributor and you know that they're going to get behind it with their team, you try to introduce the brand to the sales team and let them learn a little bit about it on their own. But then as quickly as possible, we get in there for a general sales meeting and we kick it off with them. We learn and taste it. We generally do a launch incentive of some type that's going to help drive the business and we travel with them. You really break it up and you go on right along where you spend the day with the salesman up and down the street. We have a small team, so it's hard for us to do that. Again we have to focus. When we get into a market that we believe has enough opportunity, that's how we approach it.
Javier: So I have every single flavor of BAWLS here, the can version and the glass bottle version. Cherry, Root Beer, Original.
Jon: They look like they're cold.
Javier: They are cold. The new flavor, which is Orange. Sorry. And then also you launched one exclusively online which is the Guarana Zero. So I want to try it for the first time, but before that, do you have a favorite flavor?
Jon: I always go back to the Original. It's just so unique. It's different than any other product. I think you find out there, and it's just light and refreshing. So that's my favorite, but recently we were just sampling product out at a big gaming event in Columbus, Ohio. It's amazing that people are Cherry people. People are Root Beer people. Orange. Everybody has that favorite flavor in their palate, but my favorite is the Original.
Javier: So I'll try the Original, but I'll just go through some of the ingredients. I see that it has natural guarana extract as well as caffeine and other ingredients like high fructose corn syrup. And also let me just look at... this is also the same recipe, but 95 calories.
Jon: It's different size.
Javier: Different size. 95 calories for this one and only 23. So it's not that much sugar. It does say, "This product contains high level of caffeine." As you mentioned, it's a high caffeine guarana soda. So what is guarana? What does it taste like, and why do you put this in a drink?
Jon: Guaranas are natural very produced in South America and the Amazon Rain Forest. And in South America, it is the number one, I have not been there, but from what I have always heard and learned. And you'll see ever so often a guarana beverage here in the United States. It provides a unique energy, a kick of more caffeine than a coffee bean, and it gives an intrinsic focus for your energies well. It gives you a little added focus. So it's a unique flavor, which is why it was introduced when the drink was created in '96. It was one of the first beverages to use it for both the fuel and the flavor in 1996.
Javier: So do you know of any health benefits of natural guarana extract?
Jon: Other than the focus, I'm not going to say that we're chasing the health market. All we have to do is look at our blue bottle and say it's more of a fun beverage than it is chasing the healthy nature.
Javier: So another thing is, have you remained true to the original recipe that was concocted back in the early days?
Jon: For everything that I know, we are still working with the same recipe. We're still working with the same flavor house that is our partner and has been our partner since the day the brand launched, and has been our partner in all our new flavors as well. So we've remained consistent with our ingredients.
Javier: So going back, it's a high caffeinated soda which is what you said. It's different than an energy drink. What's the difference between a high caffeine soda and an energy drink?
Jon: Generally an energy drink, the first thing you would say is that it has either herbal extracts, B vitamins, generally an amino acid which might be Taurine that works with the caffeine to give you that extra fuel. We don't have any of that. We have our high fructose corn syrup, our sugars, and we have the caffeine along with the guarana that will mix with the caffeine primarily for flavor to give you that unique flavor and kick.
Javier: I know that some drinks will give you energy, but then you'll experience a crash later on or you can get addicted to it like coffee. What are the effects of drinking this?
Jon: Generally what we find is that it's going to give you a little longer life on your fuel and not crash. That's what gamers, they're not getting the shakes or not getting the crash. There are energy drinks that they drink and then before you know it they are crashing and burning and not able to really function the way they want to with their video game. So that's primarily what started. So we think it'll sustain your fuel longer.
Javier: So going back to gaming, you said it sustains their gaming, play longer, their fuel. But it's also popular among college markets too. Right?
Jon: Yes. First off, that's one of the largest markets for energy. Period. And so it also then just would help them from a studying perspective, staying focused and going versus drinking an energy drink which might give you a little too much rave.
Javier: So it is a better alternative than energy drinks or coffee late at night?
Jon: Yes, we think so.
Javier: So I'm going to try it just so I can give people the impression of what it actually tastes like. Smell citrusy. I do smell a lemon type of flavor, lemon type of smell. Let's try it out. It's really smooth. It has a vanilla cream flavor to it. Slight thick feeling which is a good one, because it lets the flavor linger and it just felt refreshing. It doesn't even feel like what you would think an energy drink would be. It just feels like you're drinking a creamy citrus type of soda, but more cream than anything else.
Jon: It's a good description. People are always asking, "What do BAWLS taste like?" And I have to say, "It tastes like BAWLS. I don't know how else to describe it." We've had the terminology of seven-up with a vanilla kick, a light cream soda. That's what people have always described the beverage. We think it's got about the right amount of carbonation and it's got a good amount of bubbles but not too many. It is. It's a surprising alternative when someone's been used to maybe a little bit thicker, odder taste of an energy drink to taste this for the first time.
Javier: So let's say you're a student or someone, or a gamer, and you're used to drinking energy drinks and then you come to this. It fills like this won't have the same kick that on energy drink, because you're grown... if you've grown up drinking energy drinks, you would think that that flavor is what you associate with the energy, but drinking this, it's such a different feeling and a different perception. To me I feel like, "Is this going to have the same effect or not?"
Jon: That's good challenge. I think that's where we just have to rely on that first taste is a positive response, and then that first bottle that they've had positive performance.
Javier: How often do people usually drink BAWLS on average and who are your biggest fans besides the gaming and the college community?
Jon: We have some pretty loyal fans. When I go around certain stores, you'll hear that the same person has come in every day and bought a bottle to start their day. And you generally see that that you get that kind of loyal fan. On our online business, we see that we have very loyal customers who are buying frequently and consistently as they fill their orders and fill their need.
Javier: And so where in the United States can you get BAWLS? Is it everywhere in the United States?
Jon: I wish it was a little more places closer to everywhere than it is. We actually are retailing, some shape or manner. It might be a grocery store and in every key grocery store in a market like Washington or Oregon, our soon to be Colorado and Utah, or it might be gaming stores and Rocket Fizz candy stores in other states. We are in 46 of the 50 states in some manner at retail. And of course we're available online at specialtysodas.com and other online partners in all 50 states.
Javier: And also at bawls.com as well. And do you find that when people are making purchases online, that provides you good information of a new market or a new area you can go into because you have such a strong demand in that area?
Jon: Absolutely. We use that tool as an information of, "Boy, Arizona would be a great market for us to try to increase our distribution." Or we also have a couple other measures that we're using which we can touch on which is customers on our website can go and find BAWLS, and we get an email and we'll tell them where they can find BAWLS. And that really pinpoints because we track thousands of requests on that now of what states are our most popular states.
Javier: And you mentioned the distribution strategy. So it seems like you're focused on off-trade which is directly supplying the supermarkets and the retail sector versus on-trade which is supplying places like hotels, bars restaurants, cafes. Is it in those locations or is it only in retail markets?
Jon: It's primarily retail, and you look at that bottle and 10 ounce bottle is a hard sell particularly in glass in a bar to convince a bartender to open that 10 ounce bottle and make one and a half drinks. So it's very much of a challenge on premise, and that was one of the things I had to focus on. It'd be great to have on premise and restaurants and players like that. We're in coffee shops. You'll find us in the cold box in many independent coffee shops out west.
But it was harder to really hit the on premise not to say that we're not in some, but it's not a real focus for us versus grocery and other electronic stores, gaming stores.
Javier: Because I was thinking in terms of at least you can drink this by itself, but I know that a lot of energy drinks are used as mixers. And I don't know if this was also suitable for that as well.
Jon: We have some fun options if you check out our website. We have some drink mixes that our fans have submitted to us over the years that we've collected and put on our website, but it isn't, again, very popular in the bars.
Javier: And that's not necessarily the focus. You want to just drink it and enjoy it by itself because it is enjoyable just by itself. So last year, you expanded into Oregon and into the West Coast in Safeway and Kroger which are big companies. Can you walk us through an example of how you approached these big companies and how you got in?
Jon: Key is they have a good distributor partner. We do work in those days with large distributors. In Oregon and Washington, it's Columbia Distributing, one of the largest distributors in the country. So we knew they were going to be able to cover the Kroger chain up there, QFC. They currently already covered Fred Meyer for us, and then we were able to Safeway in the Oregon market. But that's the key, is to have a partner. And then it's to get your foot in the door with the grocery chain.
And with Kroger, we actually started last October and we hit the shelves in May. So it is sometimes that long of our lead time in order to really make an impact in the market. But with that Kroger rollout, we were able to add King Soopers and City Market in Colorado and then also expand our Smith's footprint throughout Utah and Nevada, New Mexico and several other western states.
Javier: So what are some challenges when trying to select a partner distributor especially one that's really large? It would seem like they have so many skews, so many options. What's their incentive to carry this new product?
Jon: That's the biggest challenge and it's getting them to taste the product generally and doing that. And then convincing that it can be a profitable and productive skew in their store. With the explosion of the numbing... and you see it going through your website, how many new beverages are there on the soda side. The same things happening on the beer side equally or larger to a degree with the craft beer explosion. So you're looking at it, but it is a challenge to get their attention and to get their shelf space so to speak in their warehouse, to get them to support you. So it is getting that introduction and convincing them. And then once they see the product, bringing some facts that we believe that they'll be successful, sharing some success stories. But I far biggest challenge is to just get that partner on board.
Javier: You said one thing is sharing success stories. So what success have some of your distributors seen in the past once they introduce BAWLS into their product line?
Jon: Generally if you can get a partner, and Fred Meyer in Oregon and Washington has been on board with us for a number of years. We're just in a cold box at Fred Meyer and we sell a lot to humans, and we're able to share some of that data, not exact and specific, but we'll share data and hopefully be able to convince others to take us on. Always helps when you have the chain store authorization, if you have that, "Okay, I can go into Safeway or I can go in here." The distributor is clearly more interested in listening to you if you can bring them some automatic retail distribution.
Javier: That sounds really good. You provide them data of previous successes and what they can accomplish if they have it, and also already have retail spots that are already ready to go in that region. And that's an easier, I guess, sell to the distributor to want to...
Jon: Yes. And then we share our profitability models. That if they sell it at this and may buy it at this, this is how their profit will pan out. Generally particularly you'll find non-alcohol products, successful ones, are more profitable than some of the other brands in their line, the high volume brands or water or beer goes. A good NA will outperform profitability wise many other categories.
Javier: What you just said is that it can outperform other products. So in retail, is BAWLS going to have to kick off one of their existing products to be replaced in that location?
Jon: At retail, yeah. Generally that's how it works though. I'm finding many grocery store chains are expanding their specially soda section. And you're finding going from 4 feet to 80 feet are adding cold box assortments. If you go in a grocery store now over by The Deli Counter, you're finding large sections of soda options that weren't there just two years ago. And again just as everybody sees the evolution, just is that DRL has changed dramatically and it's now expanded or changed, the same thing is happening in the soda world.
Javier: So why do you think there is a great expansion in the specialty soda arena? Because I know that there is a negative connotation towards drinking soda in some areas of the United States. But why would this sector be expanding?
Jon: It's different. It's fun. I think this generation is looking for new items and new ideas. You scan through your website and you just see unique products, and it's just... I think the consumer is looking for that. They're looking for fun. They're looking for throwback to old sodas and new ideas in the soda category. We have a small candy store up here in Cleveland. It's a large candy store, but it's one unit. It's one store at 230 feet of soda in this candy store, and it's about 500 or 600 different sodas. Different flavors, different items. It's just unique in experience. I go over there and I watch people just selecting and they're reading labels, they're looking. They want to try something fun whether it's a peanut butter soda or a cucumber soda or BAWLS Original. They're trying new sodas.
Javier: And it's interesting because there is an explosion of how many new beverage brands are out there. I saw a statistic that there is like 3,000 new beverage companies coming up every single year, but only 3% actually make it through.
Jon: That's why BAWLS has been around since 1996. There is something to be said about the taste and the performance.
Javier: And it says if a company cans survive through the first years, their chances of survival after has more than doubled or some statistic go like that. It's testament to how people enjoy BAWLS and you guys have been around for many, many years and I think...
Jon: 20 years.
Javier: So one of the things that you pioneered at BAWLS is you rebranded the website and you allowed for online sales. How has this been going? Why was that one of your priorities?
Jon: I think because our consumer, we think is, A, college students, and B, they're the techies, the geeks, the gamers. We needed to have a really high quality interactive website that would stand up to what they're judging and looking for. So we interviewed a dozen, at least, different companies about building a new website and we landed with actually a North East Ohio company, TRIAD Communications. And we thought they had a great creative group. They really got excited about the brand and we worked very closely with them on how to come up with a site that would really work for us and work for our brand. It would be fun somewhere where somebody would enjoy spending more than a couple seconds on your site.
Javier: I noticed they did a really great job, so I really like the BAWLS website. So if you haven't checked it out, go to B-A-W-L-S.com and just take a look at the website. It's very clean interface and it has a retail section, and I did some digging and it's built on Drupal, which is a content management system. And I think that you're hosting on a company called Pantheon and your selling platform is BigCommerce. So that interaction of those different software looks like it's working out really well. What were some of the early challenges of getting people to go on to your website?
Jon: Luring people in was the first challenge and that's where social media had to come into play. We have to communicate and reach out to folks to get them to come see our website, because we had had another website for over five years maybe not in its interactive. So we also were offering online shopping for the first time. So how did we launch online? We had to use social media and do the very best we could to get people to come to the site.
Javier: So I checked your Facebook page and it is huge. You're almost at 100,000 likes. That's really great. You have so many fans. What are you guys doing on social media besides just posting pictures of your products? How are you getting so many people to go on to social media at least?
Jon: We try to stay engaged with the gaming community. A lot of that came from within the gaming community as we were coming up incoming and building that number. It's kind of plateaued. Facebook has changed a lot of the way they manage likes and things like that. So it's plateaued for now, but we're looking to continue to grow as we grow. We look for partnerships with other companies that we can share information within the computer indoor gaming community where we can share our links and ideas. And that's where having good folks who are young and engaged here at BAWLS who can really take charge of that, and that's something we've really focused on the last three years.
Javier: You said something really important. You said that Facebook has changed and a lot of things are changing in social media. And you were recently quoted to say, "In this era of online marketing, we're exploring innovative options to accelerate our new products into market and get it directly to customers faster prior to launching at retail." So how are you keeping up with all these changes online?
Jon: Again, we got a great team here within marketing and communications and social media, and we decided that we were going to take our Zero product. First off, we wanted to make sure that it was the right sugar free product. We've had a sugar free product for years. It just didn't really not been as successful as we wanted. It's great tasting product, but it just hadn't really resonated at retail the way we wanted it to. So we built the whole campaign around launching it via social media on our website. And so we did it through that avenue and we only were selling it at bawls.com. And we wanted to get it out there. We wanted to get customers feedback and it was all positive. So then we immediately got it into Micro Center shortly after our launch and now today it's all 25 Micro Centers across the country who's our great retail longtime partner that customers love to. So now it's Micro Center retail in here.
That's different than going to Sturgis one by one and trying to trickle it out there. We want to get it out there because we wanted some feedback from our consumer. Were they going to like this product? Were they going to like the packaging? Were they going to buy into the taste and the performance? So that's why we did it that way, so we could get more immediate feedback.
Javier: So I know the product you're referring to was the glass bottle Guaranax, and the one that you're talking about now is, is it the same formula or is it a different formula?
Jon: A little slightly different formula and it's got less caffeine than the Guaranax, but the same as all of our other products. But it's the same sweetener blend. Very very similar, but with the less caffeine, you're not going to get quite the same bitter taste that you had maybe on the guarana.
Javier: I just want to see.
Jon: Like it?
Javier: Yeah, it's good. Normally diet drinks have a flavor that I don't... and I'm not particularly a fan of, but drinking this side by side, the flavor is almost the same. And I do taste the other sweetener which here is sucralose, and acesulfame-K. I do taste it because I know what it tastes like, but the flavor is the same essentially.
Jon: We tried a number of different, dozens of different sweeteners. We tried the natural sweeteners. We tried everything in there, and we came back to what had been with our other drink and we were pleased with it. And the response at retail or at with the consumer today online has been very positive.
Javier: But still I would say that I like this one better than the diet.
Jon: I'm the same guy. I'll take my sugar.
Javier: But you touched upon something really, really interesting that there's a new strategy where maybe you launch online first.
Jon: And it's not new because even some of the big guys have done this. If you look at Mountain Dew and Pepsi have come out with products, exclusive search, but it's only sold on Amazon when they brought it back. Again, not a new idea from my perspective, but we decided to play off and try it with our size company.
Javier: So here is the thing. While that's a good launching pad and testing ground for new products, how do you follow that same strategy for existing products? You're not re-launching something new. How can you bring the same excitement of a product launch for something that you've had for years?
Jon: That's a good challenge. We're constantly looking for new ideas for online marketing. And I can't tell I have that formula today, but we will constantly look to focus on products whether it's a Cherry 16 ounce can and sell, or to try to get people to try the other flavors. We saw a lot of the Original. There's no doubt, loyal customers. It's getting them to try the other flavors, our new Mandarin Orange which it's been out a year and a half, but many people have not seen it because they might not have it at retail. So how do we get that?
Clearly one of our challenges as we are moving forward is continuing to focus on the whole online marketing, online sales.
Javier: So to switch gears a little, although the online is important and you're exploring, one thing that you're grounded and focused on, it seems like, is going out to events. Every time I've talked to you, you guys are out at events. And so you're sponsoring, you're promoting. Is this how it always is or is it just a particular season? And what do you guys get out of going to so many events?
Jon: Is clearly is a busy season, busy time of the year where there's a tremendous amount of our fans from May through September. We'll be going to QuakeCon in three weeks and it's our largest event of the year. 12,000 people with the official beverage. We'll take almost a truckload and a half of product there and go through it in about 18 hours. It's a fun event, one that we've been loyal to for 15 years with a couple of gaps in between. But other events. Like a gaming event in Columbus, Ohio, where we can see 15,000 walk through and sample them just for an ounce and a half and get them to taste the product. It's just getting our product out into new consumers' hands or consumers who said they may know us for Original but haven't tried some of the other flavors. So we're always looking for opportunities like that that we can personally get involved with and learn from the consumer.
Javier: And just real curious, a truckload is how many individual bottles of BAWL?
Jon: It's cans. We can only sell our 16 ounce cans. I think I can do the math that it's 1,600.
Javier: 1,600 cases.
Jon: 35,000 cans.
Javier: So each case is...
Jon: Truck loading houses 48,000 cans, 16 ounce cans. That's a lot of soda for 12,000 people.
Javier: You do the cans because the glass is fragile and it can break.
Jon: Hotel requirements.
Javier: Hotel requirements.
Jon: One of the benefits of having a 16 ounce can is some game use will not allow glass.
Javier: That's really good to know. And then also you've been featured on a lot of TV shows. I'm not sure if this was under your leadership or maybe before, but you've been on the Big Bang Theory, Silicon Valley. You've been on movies like The Hangover. How do you get featured on these kinds of shows and movies?
Jon: We have a marketing partner in Los Angeles that helps us connect with the shows. But honestly, he's more of a conduit because the shows are common ask for BAWLS. I think if you think of the shows that you just mentioned, they're a little bit off in Big Bang Theory and things like that. They want to be a little bit of that meat product and BAWLS is like... and you'll notice that in many shows, they may not want to show the name brand products. They want to show a little bit of a different product.
Silicon Valley has been one of our more popular ones. We are in almost every episode of that. And then we're constantly being requested by movies and partners for product. So it's been fun. That's a fun side of it. I can't tell you other than just resonating the name, maybe getting some interest. It's going to drive the same amount of true volume as maybe an event or a gaming event or a sample.
Javier: When you go onto a show like that, is that a sponsorship? Do they pay you?
Jon: We do it with product. They're generally asking for us, so we're not going to pay to play so to speak. They're asking for a product and we're more than happy to provide.
Javier: So if anyone out there is a film producer or is making the next movie or TV show, you can get BAWLS and hopefully sharing this story will help resonate what the brand means and if that aligns with what you're trying to accomplish in your show. Whether it's a show about gaming community or a college campus show, BAWLS will be a good option if you want to put some product.
What do you think is the most effective strategy for BAWLS? You have TV, movies, you have online social media, you have live events. What do you think is helping to fill...?
Jon: Live events drive these results. There is no doubt about it. But social media is the most broad impact, and we talked briefly Facebook, but we have a lot of work to do to expand from that. Twitter has been a focus for us, Instagram, and even getting in the world of Snapchat. So we're working towards extending our efforts in social media. That is the most broad and effective way for us to get our message out.
Javier: And so are you guys a member of any beverage associations or groups?
Jon: The primary one that we are a member of is NACS, the National Association of Convenience Stores. And we go to a convention each year where they have thousands and thousands of retailers from around the country and distributors, they go through. So that is where we generally can hopefully connect with at least two to three new distributors each year that we're able to sample, meet and share our story with. Again, it's coming up in October in Atlanta. Last year it was in Las Vegas. So we go to that show and really focus on that show, because we can see so many diverse UCO, the key grocery stores, convenience stores and almost all distributors will walk that show.
Javier: And so you're part of one group and that allows you to meet a lot of distributors and convenience stores who you can eventually work with one day, but have you ever thought about joining... because I know there's more associations. Why only stick with that one?
Jon: We've always looked at other associations, different core groups, but today again, back to focus, we found that NACS provided us the best platform for us to invest in. When we go, we go big. We have a 10 by 30 booth and we really set up big there and we wanted to really present the product in the manner that it should be presented. So we've been going to NACS shows now since 2011. We missed one year, but since the brand has been back as BAWLS Acquisition, and that's really where our focus has been.
Javier: And so how about trade magazines or journals? Is that important for you guys to serve better?
Jon: We try to maintain strong partnerships with, number one, BevNET and Beverage World and Beverage Industry as well are the three that we track along with and we'll advertise with and work with. Whether it's providing some data or information, sharing stories, things like that. And BevNET has been terrific to go to the BevNET conferences each year. They have them twice a year, and just mingle with other beverage entrepreneurs, beverage large and small, and meet other folks and meet the BevNET team.
Javier: It looks like you get a lot out of participating in the trade association and really looking and subscribing to these journals or on magazines.
Jon: We focus on those three guys because we feel like that will hit the broadest avenue for the non-al community.
Javier: So it seems like you're growing a lot. You said you're not in just four states, I think you said, in the United States.
Jon: Yeah. But again, that's big and small. You might be in several grocery stores in one state. You might be in a few Rocket Fizz's or gaming centers in and out.
Javier: And is international expansion something you're looking to rolling out?
Jon: First and foremost, we'd want to get back to Canada. We have a very loyal following in Canada. We were up there for a number of years, and just have our work cut out for us to get the label to meet the Canadian government standards that we've been working on and trying to find the right way to get that done. So we'll continue to work on that and hopefully short-term be back in Canada.
Long-term then certainly, we're always interested, but again that came back to focus and we've got a lot of work to do still in the United States and with our online business before we start trying to adventure out into Europe or other countries.
Javier: So it seems like that's so much work that you need to do. There are so many things to manage. Can you give us a glimpse into what it's like working there? Are you working really long hours? What's a typical day like?
Jon: We're all working hard here. We have a good team here in the office and out in the field that we just try to communicate and stay as organized and work together. Everybody is willing to chip in and that's the great piece. Is that we share or work together. Our Twinsburg team, whether it's operations, communications or marketing, we're going to equate time together. Because it's a big event for the company, but it's also that we're all willing to chip in and help each other as we try to get a number of things done. Whether it's grocery, forms or filling LAN party needs.
Javier: So how do you, as a CEO, keep the team motivated, happy, create a positive culture at your company?
Jon: I think we've got the right people because they're generally self-motivated and positive. They believe in what we're doing, and so therefore me, I just need to try to help everybody organize and prioritize. But it starts with, we've got the right people.
Javier: And so how many people are there currently?
Jon: It's a small number. It's a small number. A few handful.
Javier: But it has grown since you've been...
Javier: On your website, it looks like you have some openings. You have an opening for the grand taste tester. How do people apply for that job?
Jon: That's a very requiring job. So yes. And again, our website had to be fun and interactive, and we're always looking for taste testers. You may not get paid a lot, but you get to taste a lot of products.
Javier: The other thing is as we're coming close to the close of the interview, I just want to wrap up with some final quick question. What's the most fun thing about being the CEO of BAWLS? And also what's the hardest thing?
Jon: I think it's the fans, the loyal customers just seeing that. When you see how excited somebody gets and really embraces your product, it's so gratifying and exciting. The hardest is when you can't get them the product, and they're frustrated by the fact that they no longer can get it in this state or at this retailer. Because you have to charge them a significant amount to ship it or whatever. So it's seeing that excitement from the fans, but then the hardest part is just the challenge and the struggle of filling that demand, getting the supply to meet the demand.
Javier: You already mentioned one, but what's one specific challenge that you're working on right now?
Jon: Right now, it's interesting. Our business out West has been extremely successful with that Kroger launch end of May. So we are actually trucking and training blue glass from East Coast to West Coast just to try to fill that need. We produce in two different locations, our glass bottles, West Coast and East Coast. And it's just trying to balance that, again, that supply and demand. So right now that's one specific challenge that we have, is getting the bottles over there. We have no problem filling the need. It's just getting them on the right coast.
Javier: So do you have any other future plans for the business?
Jon: We're always looking at new flavors. I think that there are some natural soda flavors that we can look at to bring to market. We hope to build on the zero calorie, looking at glass next. And so that's really our biggest opportunity. Root Beer was the last new flavor that came out in 2008, and we just felt like there was an opportunity. So Orange came in 2015, and we clearly want to continue to build on that flavor portfolio, finding good natural soda flavors.
Javier: And so have there been there any personal sacrifices or sacrifices that you had to make as a company because there was something you just couldn't do because you needed to work on something else?
Jon: There's always those things, but I have a very understanding wife having been married 33 years. So she understands the sacrifices when I'm traveling to these events and things like that at times. But that's the biggest personal sacrifice. I think as a company, we all just need to be flexible with these gaming events. We had a team in Columbus, Ohio for a weekend or in Tampa, Florida for a weekend with the events. And I think that's probably that, but they're fun events. So that's the opportunity.
Javier: And so I just want to go back. The goal of the Specialty Sodas Podcast is to reach out to beverage entrepreneurs everywhere and for them to share their story so that we can get to know them, get to know the brand and just share some of the challenges and the successes that all the different companies are having so that if you're starting a beverage company or if you're already an existing company, you can see that we're all in this together, and I want to build a community around this.
So Jon, I want to ask you, is there someone you admire or know in the beverage industry that might have a story that you think would resonate with people and people would want to hear?
Jon: That is clearly my other trade magazine folks. I would tell you that the BevNET has really embraced the entrepreneurial aspect of the non-al beverages of all shapes and sizes. And they are really very in tune to new beverages and things like that, and any member at BevNET could be a great resource to talk to, starting with John Craven who is the founder and CEO of that company. They're easy to talk to. They understand it. They really get it, and that's a great source of just following the trends and understanding what's going on in the business, particularly for new beverages.
Javier: So what's some of the best advice you've heard or have been given that's helped you through the tough days of running the company?
Jon: I think is just stay focused on your product. You got to believe in your product. You have to believe that it's the best tasting product that it'll perform, and you just have to stay with it. And if you have that belief, you will work hard. You can sell all day long if you believe in your product that is performing to what it says it's going to do and that it tastes great.
Javier: Following that, do you have any advice that you would give to someone who's starting a company or a beverage company, or just a company in general. You said believe in your product, believe in what it does. But how can you help them discover who their audience is and how to help them grow? What advice would you give them? Because they may love the product, but how do they get other people to love the product too?
Jon: That's an ongoing battle for all of us, but for us we were very fortunate with that link up with the gaming community. If it's a performance product, find who you're trying to reach and try to find common ground with what market are you really trying and don't try to hit too many. Don't try to hit multiple shotgun approach. Try to find that market that you're trying to reach and stay at it and just try to link up with the... if it's the sports market or if it's the health market and stay true to it.
Javier: And so if you can pin down just one thing, one factor that led to BAWLS' success, what do you think it would be?
Jon: I think it's unique. It's different. When it hit the market back in '96, it was unique and different and it has stayed that way today. The bottle, it draws your attention. You look at it and you're like, "What is it?" It's one way to look at it. We actually redesigned our can, because we didn't feel that our order can had the same unique appeal, and after we brainstormed, we put our bottle on a can. Because it was what is really synonymous with our brand. And that's what we did. We were unique and premium and we think that the bottle gives us that and will always stay with that. We were the same bottle manufacturer as what started in '96.
Javier: So here's another thing. Why do you guys exist? What would the world and what would the gaming community and just what would people be missing out if BAWLS didn't exist anymore?
Jon: I think you see a lot of fun when folks are drinking BAWLS and having fun with it. I think that it's a great tasting product that folks are extremely loyal to and they're not going to find that same alternative in other beverages. As you mentioned, people taste and they're like, "Will I get the same amount of energy as an energy drink?" After that one, they may learn that it is. You may find out today.
Javier: I'll find out in a few hours if this is successful. But it's working for this conversation. I feel happy. So what's one last message or impression you want people to know about the company?
Jon: I think you can learn a lot at our website. Check it out. If you've never heard the brand, check it out, and whether it's shopping online and try the product, I think once you taste it, it is a unique product that you'll enjoy and hopefully drink more of.
Javier: And so if anyone wants to reach out to you or get involved in the BAWLS community, learn more about your company or try the products, how can they do that? They can join your social media. What can they do?
Jon: Absolutely. The best way is the website, quickest, easiest. It's one stop shopping. We've got a number of different contact forms and we do respond. We do respond. When you ask us where to find it or you want to sell it, or you contact us for a sponsorship, you will get a response. And I think that's the quickest, easiest way to get us and where they are. All of our social media is connected to it as well. So there's a lot of different ways at bawls.com to reach us.
Javier: All right. So once again, this is Jon Gunnerson, CEO at BAWLS Acquisition. He's also the CEO at Solvi Acquisition. And remember, these are two separate privately held companies. BAWLS Acquisition owns the BAWLS Guarana brand, Solvi Acquisition owns the Crunk Energy brand. They're some of the most energizing and great tasting smooth drinks out there. Today we talked just about BAWLS Guarana. We can leave the story of Crunk Energy for a future episode, and it's actually a really cool story too. So look out for that in the future.
Thank you, Jon, for being here, and thank you everyone for being a part of the Specialty Sodas Podcast. See you next time.
Jon: Thank you.