New Monster brands Mutant and Hydro could each generate $200-$400m in retail sales in 2-3 years, predicts Wells Fargo
Writing in Wells Fargo’s latest Beverage Buzz survey, which is based on interviews with convenience store retailers across the country, senior analyst Bonnie Herzog said: “Based on our survey results and previous analysis, we continue to believe that Monster’s three new innovation platforms (Mutant, Hydro, and an as yet unannounced third platform which we believe could be a coffee product) could contribute nearly $1bn in retail sales within three years.”
Mutant ($1.99 – launching Q3, 2016) – a carbonated soft drink with 115mg caffeine in a 20oz PET bottle that is likely to compete with Mountain Dew – is a particularly strong product, predicted Herzog: “Given recent premiumization trends in the c-store channel, and the strong alignment of incentives between retailers and MNST to drive current CSD consumers to Mutant, we ultimately think Mutant will do very well with limited cannibalization of existing Monster products.”
Hydro ($2.69-$2.89 - launching Q4, 2016) – a ‘non-carbonated energy hydration drink’ with 120mg caffeine in a 500ml plastic can with an aluminum top – has no direct competitors, but could be harder to position, she said: “If Monster is able to define this product and its positioning to both customers and retailers once it is formally launched in the marketplace, and market it accordingly, it should resonate with both consumers and perform well.
“We think in particular a product like Hydro in what is essentially an entirely new category will require direction in messaging and marketing support for retailers to fully grasp its potential, but given the size and growth of enhanced waters, we think ultimately this product has a lot of potential.”
