• by Steve Ellwanger , December 19, 2022

Splash Beverage Group is counting on premium pricing, growing retail distribution and new brand ambassador Drew Brees to make its Tapout hydration beverage the “fourth leg” of a table that includes Bodyarmor, Gatorade and Powerade.

At last week’s annual Emerging Growth Conference, Splash Beverage CEO Robert Nistico shared the strategy for Tapout in the walkup to the beginning of the brand’s relationship with former National Football League quarterback Brees.

“It’s really a better mousetrap, I like to say,” Nistico said of Tapout’s five-electrolyte, all-natural ingredients and premium-price proposition.

For distribution with Walmart, Tapout made “a commitment—with or without their desire—of maintaining a premium position” to Bodyarmor, Gatorade and Powerade.

“Retailers love that because this has always been a loss-leader category and nobody makes any money in it,” said Nistico.

While Tapout will do buy-one, get-one offers, “we’re always going to be about 20 to 30 cents higher” than the three competing brands.

In October, Brees accepted an equity position in Splash Beverage in lieu of cash compensation to promote Tapout.

Earlier this month, Splash Beverage said it had gained distribution for all four Tapout SKUs in 1,018 Publix supermarkets in Tennessee, Florida, Alabama, Georgia and North Carolina. The company also added nine distributors to its network in the Southeast.

Along with Tapout, Splash Beverage markets Copa di Vino single-serve wines, Pulpoloco flavored sangrias and the Salt flavored-tequila brand—which recently made its debut in “a small number” of Buffalo Wild Wings restaurants in Florida, according to Nistico.

He opined that the Buffalo Wild Wings deal “we believe will drive us into” Applebees and restaurants owned by Brinker International—whose holdings include Chili’s Grill & Bar and Maggiano’s Little Italy.

When Splash Beverage acquired Copa di Vino two years ago this month, the deal included Pulpoloco’s sangrias and the rights to its biodegradable paper cans, which cost significantly less than aluminum.

“This is a big deal. The ESG sustainable thing isn’t going away even if you wanted it to,” said Nistico.

Splash Beverage plans to sell excess inventory of the paper cans.

“Walmart’s actually asked us for an 18-month exclusive on this for some of their private label products."

In a November report, financial analyst Rob Goldman of Goldman Small Cap Research predicted additional brands are in the cards for Splash Beverage.

“Leveraging its current successes, we expect the company may seek to add another brand to its portfolio sometime in 2023,” Goldman wrote.=