Is Cold Pressed Juice The New Frozen Yoghurt?
Is cold-pressed juice about to become a major new sector at the heart of the health boom, or will it go the way of frozen yoghurt and numerous other food fads before it?
‘As big as coffee.’ These four words, a response to the question of the potential of the cold-pressed juice market, are the universal assertion of the current band of ambitious founders who have set up juice companies in London over the past 18 months.
They are betting that juice, in a newly packaged ‘cold-pressed’ format, is about to break out of the niche health food shops and ‘Gwyneth’ stereotypes in which it has existed to date, and is set to go mainstream. Several founders in the UK have business plans estimating that their companies will grow to £25m within the next five years. Can juice really repeat the success of coffee over the last decade, achieving its size, breadth and status?
The half-dozen-or-so startup juice brands that have suddenly sprung up in London certainly believe so. Many have borne witness to the success of juice in the US over the last few years. It has spread rapidly out of Los Angeles and into cities like New York and Chicago, where a handful of brands has swiftly built up a presence, becoming mainstream names and starting to command vast valuations in the space of just a couple of years.
Persuading the public
In trying to emulate this success, aspiring companies in London have taken the US template and identified their first challenge: persuading the public that drinking cold-pressed juice is not only a credible shortcut to being healthy — it’s also cool.
Early signs of the juice boom are visible below fashion store Wolf & Badger on Dover Street in Mayfair, a few doors down from Victoria Beckham’s recently-opened boutique. Shoppers and hedge-fund traders emerge from the basement location of Raw Press sipping on kale-and-chard-laden juices. Similar stories of modest success have come out of the early experiments of cold-pressed juice bars in Marylebone, Notting Hill, Shoreditch, Soho and Chelsea.
Adoption has not been explosive, but the new cluster of London brands is adamant that cold-pressed juice brands could become the natural successors to Innocent or even Starbucks.
As things currently stand, though, the idea of growing to the size of either of those two beasts looks fanciful. Factors like the price of juice, confusion over its benefits, and the often-muddy taste of vegetable juice are so far proving a stretch for London’s palettes.
The juice founders, however, argue that a window has opened up and that now is the time to strike. There is talk of ‘structural shifts’ — movements that have created an opportunities that haven’t previously existed.
The founders’ case revolves around the degree to which we are suddenly scrutinising what we consume. Our health and wellbeing increasingly define our aspirations; we spent £33bn on health and wellness around the world in 2013. As health becomes a priority, juice is seen as an easy ‘access point’ for the average person. Conservative estimates are circulating that over £7bn will be made from juice sales and smoothie bars this year, a big chunk of which will, of course, come from the US.
A number of people have started referring to ‘tipping points’. According to Ed Foy of Press London: ‘We’re basically solving a growing problem that being healthy is inconvenient and a chore.’
A gap is opening up as traditional fruit juices and smoothies come under fire for their sugar content and doubts are cast over their nutritional value. Consumers are evolving their shopping habits around health and taste faster than ever.
It’s a shift with which big companies are struggling to keep pace.
Larger companies have become exposed to greater instability; they are increasingly vulnerable as new challengers, emerging from garages and bedrooms, are not only innovating faster but are able to get through to consumers — something previously unheard of in the drinks industry.
Having spent millions on buying startups (Vitamin Water, Innocent, Zico coconut water, Honest tea, Odwalla juice), Coca-Cola set up an entrepreneurship programme last year. Hoping to gain access to new brands early in their lives, it offers access to expertise, and to its distribution network, in return. It has also set up Coke VEB, a venture capital fund with which it invests in emerging brands.
Meanwhile its rival Pepsi is known to have already ‘kicked the tyres’ of several cold-pressed juice brands that are barely out of their first year.
A Californian juice company called Juicero is in the process of raising a spectacular $100m (£65m), with major VCs including Google Ventures and Campbell’s soup (whose CEO is rumoured to have run back to his office to propose a $10m investment upon tasting the juice) at the table. Juicero’s angle is that it juices fruit and vegetables immediately upon picking; it is now looking to acquire its own farm.
These stories, alongside the thriving juice market in the US, have cranked up excitement levels in the UK. Before cold-press juices took off in New York, the drinks were seen as an exclusively LA phenomenon, but take-up on the east coast — which has greater similarities to London — has made people revisit the idea of its potential here.
In two years, juice bars have sprouted up all over Manhattan, in the process denting the belief that juice bars only work in cities that bask in year-long sunshine. A New York chain called Juice Press has opened 24 shops in two years and is aiming for 50 by the end of this year.
Uncertainty remains, however, over whether this growth can be translated to London on a meaningful scale.
Londoners still appear confused, sceptical or disinterested in the value of the flagship cold-pressed drink: the green vegetable juice. ‘Although we sell cold-pressed juice in good numbers, I think the benefits are perhaps not quite explicit enough for a lot of consumers,’ says Ben O’Brien, the owner of Sourced Market, which stocks cold-pressed juice. ‘Some people are trying to push the boundaries too far for British consumers.’
Remember salad bars?
The question that hangs over the whole category is of whether juice is a fad. Is it the latest food gimmick to make noise, rather as frozen yoghurt or cupcakes once did?
The story of the salad bar is cited by juice pessimists as a cautionary tale for anyone entering the juice market. Salad bars were hyped in similar fashion to juice over a decade ago, likewise riding on the back of a more health-conscious public. That format has all but died, absorbed by brands like Pret and Itsu and used to form part of their lunch lines.
Frozen yoghurt brands like Froyo, Frae, Samba Swirl, Snog, Yog, Moosh have been popping up since 2010 but are fading just as quickly. Even the American giant Pinkberry has retreated from its UK rollout, and it is closing stores faster than it is opening them in the US.
Ed Foy admits: ‘Cold-press is, annoyingly, a fad; there will always be something that’s faddy, but there is substance and genuine value in cold-press, unlike those other examples. It’s a very convenient and effective way of getting vegetables to people.’
Foy and his peers consider a shift to simpler, more accessible and more aspirational positioning as the smart path to take. Many are also conscious of the dangers of presenting cold-press in the smaller, contentious and difficult detox and ‘cleansing’ categories.
Jemma Coombe, a buyer at the upmarket grocer Daylesford, reports that cold-pressed juices are ‘flying out’, adding that the store sees the health-and-lifestyle component to the trend being critical to success.
Selfridges, a good testing-ground for food trends that cross into lifestyle, extended its floorspace for cold-press in January. It also sold over 600 Kuvrings juicers at £300 each in the month around Christmas, making cold-press juicers its most successful kitchen gift.
If cold-press does take off, a race to scale will be underway as juice bars start try to saturate the London market. It is expected that the city will be able to accommodate 50 outlets, each selling an average of 200 juices per day at £6 each, over the 250 trading days in a year. This would make it a £15m business. The idea of expansion through the rest of the UK and even into Europe is tantalising the current band of juice-pressers. They just have to convince us that we really need and want their drinks as much as we want coffee.