JAB Holding Company’s Long-term Love Affair with the American Consumer
One name has dominated the headlines over the last few years in global food, beverage, and casual dining M&A: JAB Holding Company. It seems like every month a billion dollar deal is announced involving JAB, including the May 29th Pret a Manger acquisition for a reported £1.5 billion. Outside financial circles, however, few people know much about JAB. Is it a private equity firm? Family office? What is its source of capital, and why all of the sudden does JAB seem like the largest coffee company in the world?
While fairly established in some arenas already (e.g., the military, entertainment industry) brands and retailers are increasingly adopting augmented reality (“AR”) as a means of engaging with their customers. AR is a technology through which a view of a real-time, physical environment is “augmented” by digital information (typically visual or auditory, but other senses can be engaged too). In layman’s terms, a consumer directs his/her smart phone at a product on the shelf, and through an app, certain images trigger the AR presentation on the smart phone. The AR content can range from presenting a product tutorial, to allowing one to “see” inside the box, to communicating information on product options or upgrades, to simply conveying an entertaining brand “story” (regarding the latter point, check out 19 Crimes – an Aussie wine company).
Wine in a Can
You’ve probably never had a sommelier ask you if you’d like them to “crack one” for you….that could be changing.
Striving for the Top of the Food Chain in the Smart Home’s Explosion
The past two Consumer Electronics Shows have been defined by smart speakers—the Amazon Echo in 2017 and the Google Assistant in 2018, and those are just the tip of the smart home iceberg. Apple’s recent entry into the market makes it the final hardware-producing FAANG (Facebook, Apple, Amazon, Netflix, and Alphabet’s Google) member to join the competition, and the countless consequent devices designed to interact with the budding universe of smart speakers means that there is no shortage of gadgets for eager consumers to integrate into their home ecosystems. This explosion of smart devices brings the Internet of Things (“IoT”) one step closer to household ubiquity. That is, we are accelerating towards a future where the interconnectedness of each part of the home—from our speakers to our locks—is so commonplace that we don’t even think about it, just like we no longer think about the number of electric appliances in our homes.
Retail’s Recent Interest in Healthcare Insurance Tie-Ups
We’ve Come A Long Way Baby
Parents are continually searching for products that will make life with an infant a little bit easier, which these days include a wide variety of tech-enabled products and services meant to help babies sleep longer, eat better, and stay safer. As the juvenile products’ industry has increasingly embraced advancements in technology, new parents are faced with a litany of new product choices, including cradles that rock themselves, wearable devices that monitor sleep patterns, temperature, oxygen levels, and heart rates, and highly engineered baby monitors controlled by smart phones. While the dizzying array of evolving product options may be overwhelming for new parents, it continues to fuel growth in the U.S. durable juvenile products’ market, which grew to $6.4 billion in retail sales in 2016, according to The NPD Group.
General Mills Acquires Blue Buffalo
With their recently announced acquisition of Blue Buffalo, General Mills recently got back into the pet food game (after 50 years) in a big way, in order to cater to the newest members of the American family – pets.
Authenticity in the Outdoor Space
Poser – /ˈpōzər/ noun: a person who acts in an affected manner in order to impress others. We can’t think of anyone who would enjoy being labeled with that moniker. Given enthusiasts’ hyper vigilance when it comes to proper bona fides in the outdoor industry, you’re much more likely to hear it, or a related term, tossed around on ski slopes rather than a sidewalk. While there are many attributes that outdoor and enthusiast brands want associated with their products – durability, fashion, sustainability, social impact . . . arguably the most important is authenticity. Without being deemed authentic, brands risk being lumped into the “also-ran” category of copycat gear – perhaps attractive to folks buying based on price, but unlikely to garner the attention of the most serious practitioners of the outdoor arts.
Fancy Food Show – Same Same but Different
The first major food/beverage trade show of the year, The Winter Fancy Food Show, rolled through Moscone Center in San Francisco a couple of weeks ago, attracting over 1,400 exhibitors and 25,000 visitors. After eating our way through the show and talking to countless entrepreneurs and a few large players, we are pleased to report that the mood on the floor concerning the food and beverage industry and its consumers was extremely positive and optimistic. MHT Partners hasattended the show for years, and every year it seems to grow both in terms of exhibitors and attendees. The general vibe was similar and the major trends were also familiar – same same but different – from recent years. A few trends that struck us:
The Sparkling Water Revolution
Sparkling water is one of the hottest consumer products in years. Among changing consumer preferences, new market entrants, private equity investments, and strategic acquisitions, sparkling water has the makings of a craft beer-type revolution. Americans, once heavy soda drinkers, have been looking to reduce sugar, calorie, and artificial sweetener intake. Enter a sugar free, calorie free, flavored sparkling water, which when consumed, has many of the desired taste features of a traditional soda. According to Nielsen, the sparkling water category has doubled over the past 4 years, growing from $961 million in the 52 weeks ending June 1, 2013 to $1.8 billion in the 52 weeks ending May 27, 2017.