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The Honolulu Advertiser
Posted on: Wednesday, March 24, 2010

Coconut water drinks trickle into mainstream market

 •  A slice of competition

Associated Press

BERKELEY, Calif. Coconut water is making a splash in the beverage market, touted by manufacturers and fans as the healthy way to hydrate.

"It's an exciting category right now," said Arthur Gallego, spokesman for Vita Coco, which has received an endorsement from Madonna.

Coconut water the liquid found in young coconuts has been popular in tropical countries ever since someone figured out how to crack that nut. And it's been available in packaged form in ethnic markets and natural food stores for some time in the United States.

But now it's showing up in mainstream supermarkets, packaged in juice-box style packages and coming in an array of flavors, such as peach-mango and tangerine.

"The consumption of coconut water has trickled down from the natural food stores to the mainstream," said Rodrigo Veloso, founder and CEO of Los Angeles-based O.N.E., One Natural Experience, makers of O.N.E. Coconut Water.

Veloso's company is bringing out a new product, O.N.E. Active, which sports fewer calories than its regular coconut water and adds ginkgo biloba, ginseng and catuaba and comes in three flavors.

Already, coconut water has created some big-name buzz. Matthew McConaughey and Demi Moore recently invested in Vita Coco, which was founded in 2004 and saw sales jump from about $4 million in 2007 to $20 million in 2009, according to Gallego. Meanwhile, Pepsi has invested in O.N.E. A third company in the market is Zico, founded in 2004.

While coconut water sales are growing in the $40 million to $60 million range annually they're still a drop in the bucket compared with billion-dollar drink brands like Red Bull, said Jeffrey Klineman, editor of Bevnet.com, a review publication on nonalcoholic beverages.

Fans of coconut water praise it for being relatively low calorie, natural and packed with important nutrients. An 11.2-ounce serving of Vita Coco contains almost 700 milligrams of potassium, more than a banana.

That's a good thing, because fruit-and-veggie-shy people often don't get enough potassium, said Andrea Giancoli, registered dietitian and spokeswoman for the American Dietetic Association.

At about 60 calories for an 11-ounce serving of plain coconut water, the drink delivers good nutritional value. Still, not that many people exercise with the intensity that requires more than plain water for rehydration and some aren't exercising at all, Giancoli said.