When the Coca-Cola Co. announced it was discontinuing Honest Tea, co-founder Seth Goldman jumped into action. In a recent episode of The Food Institute Podcast, Goldman discussed his decision to launch Just Ice Tea and how he was able to anticipate and fill a chasm in the beverage market before it even occurred.
Goldman co-founded Honest Tea in 1998 and was with the company through its sale to Coca-Cola in 2011, as it became the top selling organic bottled tea. After stepping away from Honest Tea in 2019, Goldman had no intention of getting back into the beverage business – but that quickly changed when he heard Coca-Cola was exiting the category he helped create.
Jumping into action
Coca-Cola announced its decision to discontinue Honest Tea on May 23, 2022. “By June 6th, basically two weeks later, we said, well, we’re going to go launch our own brand of organic bottled tea,” Goldman explained.
In the three months that followed, Goldman and his team established a brand name, lined up a supply chain in terms of sourcing and selling, and got their new product organic, kosher, and fair-trade certified. After all that hustle, “on September 6th, we sold our first bottle of Just Ice Tea at a PLNT Burger in New York City,” Goldman said.
In fact, Just Ice Tea debuted before Honest Tea was even off the shelves.
“The Honest Tea consumer was thirsty and would be very disappointed if they weren’t able to buy it,” Goldman explained. “We wanted to make sure there would be no let up in the shelf space, that there wouldn’t be a void.”
An honest opportunity
The decision to discontinue Honest Tea didn’t make sense to Goldman, who had spent 20 years successfully creating a market for low-sugar, organic and fair-trade drinks.
“Coke had their business reasons for stepping away, but it wasn’t because the category was declining, or the consumers stopped buying it, or that Honest Tea stopped being the top-selling brand of organic bottled tea,” Goldman said.
“It certainly doesn’t make sense, as an entrepreneur, to not take that opportunity when we have so much familiarity with it.”
That familiarity with the product and the market is precisely what enabled Goldman and his team to launch Just Ice Tea at an unprecedented pace.
“We had the muscle memory,” he said. “It was a great example of what you get with a high-performing team, with having invested in the right relationships, and enough experience to really be decisive.”
Invaluable experience
When it came to choosing flavors for Just Ice Tea, for instance, the team immediately knew what to do. “We basically went with the top sellers that were part of Honest Tea’s line,” Goldman explained.
“We didn’t have to go look at market data, we just knew because we had been selling Honest Tea for 20 years,” he said.
Currently, Just Ice Tea is available nationally in Sprouts and will be rolling out to a number of other grocers including Giant Food and Whole Foods later this month. This rollout is an undeniable feat for a product that didn’t exist six months ago, but according to Goldman, this is just the beginning.
“There will certainly be several thousand retailers that will have the product on their shelves before the end of the year,” he said. “It’s an exciting moment… a unique transitional moment, where you may find Honest Tea and Just Ice Tea on the shelf.”
