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INNOBEV GLOBAL SOFT DRINKS CONGRESS 2014

‘You’ve got to feel a little sorry for Schweppes’: Fever-Tree CEO delivers $42m tonic

30-Apr-2014
Last updated on 30-Apr-2014 at 17:49 GMT2014-04-30T17:49:57Z - By Ben Bouckley+
‘You’ve got to feel a bit sorry for Schweppes’: Fever-Tree CEO's tonic
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Fever-Tree CEO Charles Rolls insists Schweppes is no longer the ‘great old British company it was’ and insists the brand is scared by his firm’s giant steps in premium spirits mixers.

Rolls is former MD of Plymouth Gin and from 1997 breathed new life back into the brand – boosting case sales fourteen-fold to 80,000 cases per annum in 2001.

Vin & Sprit (then owners of Absolut Vodka) bought the brand, but not before Rolls had developed an aversion to lacklustre, poor quality mainstream tonics preserved with sodium benzoate, sweetened with saccharin or flavored with decanal.

'Supporting and lifting wonderful spirits'

And with that the idea for Fever-Tree Premium Indian Tonic Water was born, though the range (see photo) now stretches to a Bitter Lemon, Lemonade, Ginger Ale, Ginger Beer, low-calorie Tonic and Soda Water.

“Someone needed to create a mixer range that wasn’t overpowering, didn’t ruin the gins you were mixing, didn’t make it impossible to tell the difference between a Plymouth and a Tanqueray, that somehow supported and lifted these wonderful spirits,” Rolls told delegates at Zenith International's recent InnoBev Global Soft Drinks conference in Lisbon.

'Where's there's a market for premium mixers, there's a market for Fever-Tree'

In 2002 he and brand co-founder Tim Warrillow started developing premium all-natural mixers with the best ingredients they could source – thus the brand’s tonic water uses pharmaceutical grade quinine from ‘Fever Trees’ in the Eastern Congo, marigold extracts and bitter orange from Tanzania.

First released in 2005, the Indian Tonic established Fever-Tree as leader of a new category – premium mixers for spirits. Sales hit £25m ($42m) in 2013, with the drink underpinned by Rolls’ mantra: “If three quarters of your drink is the mixer – make sure you drink the best.”

“We launched in the UK, planned immediately to go to Spain, America, the other main premium spirit-consuming markets. Wherever there’s a market for premium spirits, there’s a potential market for Fever-Tree,” he said of the mixers, which are sold in 200ml glass bottles.

Trump Tower, Claridge's, The Ritz, Raffles...

“That’s the rule we’ve followed. We’re in some great places – the Trump Tower in New York, Claridge's, The Ritz, Raffles, the Burj Al Arab,” Rolls said.

“But we’re not trying to be just for a tiny select portion of the market that can only afford the very ultra-premium – we’re trying to offer anyone who cares about good quality drinks the opportunity to find Fever Tree,” he added.

“So in the UK in Tesco, in Spain in Carrefour, here in Jumbo – we’re trying to change the ability of consumers to have a really great drink, and it’s going to cost them 30 cents more than the mass mixers everyone has known before,” Rolls said.

Fever-Tree’s CEO says the brand has worked with all of the world’s top spirits houses - these include Johnnie Walker (Diageo), Bombay Sapphire (Bacardi), Plymouth Gin (Pernod Ricard), Tanqueray (Diageo), which all want to showcase their spirits in the best light at tasting events.

“But of course, what happens when you create a successful new market is that you start to get competitors. That’s fine, it’s what happens,” Rolls said.

He explained how Fever-Tree once advertised in a gourmet magazine where rival and British institution (as a brand name, at least) Schweppes had never advertised before.

'What do premium mixers say about old, regular Schweppes?'

Schweppes then took adverts for the next three months, the same thing happened when Fever-Tree took an advert in an architectural magazine.

“Now, we go to any magazine and say ‘we’re not going to pay for our advert’, but we guarantee Schweppes will pay for five!” Rolls joked.

“It’s an interesting strategy for them. You’ve got to feel a bit sorry for Schweppes, it’s no longer the great old British company it was. It’s now owned by 18 different companies around the world,” he said.

 “They’re very nervous…worried about saying ‘if there really is a premium mixer out there, what does it say about the old, about regular Schweppes?” Rolls said.

Showing delegates a Schweppes poster that set its new bottle design (see photo) against the traditional design, Rolls quoted a Madrid bartender saying: “The same drink with a fancy bottle at twice the price? That doesn’t make something premium!”

“This could be difficult, dangerous territory, and I’m delighted, but let’s leave them alone,” Rolls said.

Related topics: Health and Wellness , Fizzing-Up Carbonates, Future Flavors, Premium Indulgence, Markets, Bacardi, Diageo, Pernod Ricard, Soft Drinks & Water, Beer, Wine, Spirits, Cider