San Diego-based JuneShine – a hard kombucha and ready-to-drink canned cocktail (RTD) maker – is on track to produce more than one million cases (about 72,580 barrels) in 2022. The milestone follows the company passing a total of two million cases produced as a brand since its founding in 2018.
“That’s definitely a sense of product market fit,” JuneShine co-founder Forrest Dein told Brewbound. “Once you get to two million cases, it’s like ‘OK, this is the real thing.’”
Dein and fellow co-founder Greg Serrao talked to Brewbound about the growth of the brand – helped by the launch of its spirits-based canned cocktails – and how they plan to maintain their momentum, including the release of new RTD and hard kombucha variety packs and JuneShine’s first East Coast brick-and-mortar location.
JuneShine Now No. 4 Spirits-Based RTD in SoCal Off-Premise Channels
JuneShine launched its spirits-based RTDs in March, with three 8-10% ABV offerings – Classic Tequila Margarita, Tropical Rum Mai Tai and Passion Fruit Vodka Soda. Classic Vodka Mule and Lemon + Lime Tequila Ranch Water were added later in the spring.
While the RTD segment has “gotten competitive very quickly,” JuneShine has been able to stake a claim, with no artificial ingredients or added sugar and all real spirits. The brand family is now the No. 3 spirits-based RTD in San Diego off-premise channels, No. 4 in Southern California and No. 8 in the state, according to Dein, citing NielsenIQ data.
“Our shift from a hard kombucha brand to a better-for-you brand platform has been successful, and we’re gonna go even deeper next year,” Dein said. “It’s growing really, really fast and [it’s] starting to gain a lot of traction outside of California as well – everywhere from Hawaii to Denver to Boston to Seattle and Arizona.”
The spirits-based offerings are also starting to surpass sales of JuneShine’s original hard kombucha offerings in select markets, including Boston and Vermont.
“What we’re finding is that when you put the JuneShine brand on a margarita or a vodka soda or a rum Mai Tai, we’re crossing that gap from this kombucha niche to this mainstream market,” Dein said.
“It’s a lot different than the hard kombucha,” Serrao said of the RTD market. “The players we’re competing with are beasts.”
Those competitors include beer giants such as Anheuser-Busch InBev (Cutwater Spirits), international spirits companies like Pernod Ricard (Absolut Vodka Sodas) and dominating segment leader E. & J. Gallo (High Noon Sun Sips). But JuneShine has “now climbed past” large competitors including Crown Royal, Malibu, Jack Daniel’s, Jose Cuervo and Ketel One, according to Serrao.
“This is a real battle,” Serrao said. “But the consumer continues to drift away from beer and going into this alternative [space], and it seems like this is what they want. And we try to listen to customers and best deliver to what it is they’re looking for.”
JuneShine’s RTDs are now distributed in about 10-12 states, according to Dein. Next year, the company plans to bring its spirits-based offerings to another 10-15 markets, including Nashville, Tennessee; Dallas, Texas; Washington, D.C.; Maryland; New Hampshire; Maine; Ohio; Wisconsin; Nevada; Connecticut; New Jersey; Kentucky and Minnesota.
Mixed Spirits Variety Pack Launching Next Month, Margarita Variety Pack Set For Spring
To continue the growth of JuneShine cocktails, the company is releasing multiple RTD variety packs.
The first, its Mixed Cocktail variety 8-pack, is hitting select markets now, with a full-market launch in November. The mixed-spirits pack includes four JuneShine RTDs: Passion Fruit Vodka Soda (8% ABV), Classic Vodka Mule (10% ABV), Classic Tequila Margarita (10% ABV) and a new Mango Tequila Margarita (10% ABV).
The company is also planning a second mixed-spirit variety pack for 2023, featuring a new pack-exclusive rum-based offering.
“The occasion is it’s the ultimate party starter back,” Dein said. “You’re going to your friend’s barbecue or pregame or to their house and now you’ve got three delicious, different styles of craft cocktails in one box for $19. You’re getting close to 15-16 shots for under $20, so when you do the math, it’s a great deal.”
The second variety pack launch, its Tequila Margarita variety 8-pack, will be the company’s first flagship release of 2023, launching in the spring. The variety pack will include four flavors: Tequila Lime Margarita, Mango Margarita, Tropical Margarita and Spicy Margarita. Each flavor with be 8% ABV, remixed slightly from the existing recipe to create a more “sessional-able high ABV” offering.
“There’s this whole subcategory of RTDs that are being branded as margaritas that they may taste somewhat like a margarita, but they’re either malt-based or they’re wine-based, because there’s all these restrictions on spirits,” Dein said. “But from Day One we were like, if we’re going to do this, our customers hold us to a really high standard with transparency. We can’t get away with a margarita that doesn’t have tequila in it or a vodka soda that’s malt based.
“There’s a lot of noise in this space right now, and all these different types of bases,” he continued. “Over time, you’ll see the real spirits, real juice standing out. There’s a reason why High Noon has been the clear winner in the low-ABV cocktail space. And I think that the same value props can be there in the high-ABV space.”
Dein and Serrao mentioned “transparency” several times when describing JuneShine’s RTDs.
“From day one, transparency was really at the core of the brand,” Dein said. “It’s crazy, in the cocktail space, you still don’t see nutrition facts. If you look at that top 10 list of brands in the category, almost none of them except for High Noon have nutrition facts. And that’s crazy to me that these guys are selling margaritas and mai tais and vodka drinks with 20-30 grams of sugar.”
JuneShine’s Classic Tequila Margarita has 6 grams of sugar and carbs and 220 calories per 12 oz. can. Like all of the company’s RTD offerings, it’s marketed as a “better-for-you” premixed cocktail that offers convenience without the high sugar content – a concept that Dein and Serrao weren’t sure was “going to translate to consumers.”
“It made sense to us, but maybe people do want sugary cocktails,” Dein said. “But we’re already past all these brands, and we’re showing that there’s a lack of knowledge around how much sugar is in these products.”
Because of the array of RTD products in the market, JuneShine has had to educate consumers on not only what the company offers, but what goes into its competitors’ offerings. But consumer education is nothing new to JuneShine, which has had to educate drinkers on what hard kombucha is since it entered the market.
“Our conversion rate for samplings-to-purchases is a lot higher with a cocktail just because we’re getting way more people walking up,” Dein said. “And then once people try they’ll go, ‘A canned cocktail can actually taste good and not be sugary?’ And it’s just a higher conversion rate in store demos.”
“Within the RTD category, there’s different customers and there’s different products,” Serrao said. “Cutwater is a really good product for people who want that kind of beverage. … I think the younger demographic, which is generally our customer, is probably a little more health conscious, is looking for cleaner beverages.”
Hard Kombucha and Canned Cocktails are Equal Priorities
As JuneShine’s canned cocktails rapidly growth, the company’s hard kombucha SKUs are still growing “really aggressively.”
“Everything is great about the canned cocktail, but – I think maybe this isn’t true for some of our peers – we’re still growing a lot in our kombucha,” Serrao said. “We’re not moving away from that by any means.”
Hard kombucha and spirits-based RTDs are of equal importance to JuneShine as it continues its journey to being a total beverage company, the founders said. To support all the company’s offerings, JuneShine has brought on sales team members with experience from Boston Beer Company, Mark Anthony Brands and A-B products who have a specialized focus on selling various beyond beer offerings, including Angry Orchard hard cider, Truly Hard Seltzer and Twisted Tea.
JuneShine will also release two hard kombucha variety 8-packs in 2023: Midnight (Midnight Painkiller, P.O.G., Acai Berry and Coconut Cruise) and Sunset (Grapefruit Splash, Mango Daydream, Yumberry and Black Cherry Breeze).
First East Coast Taproom to Open This Winter
JuneShine will open its third taproom and first brick-and-mortar location on the East Coast this winter. Located in the Williamsburg neighborhood of Brooklyn, the taproom will serve hard kombucha on tap and craft cocktails, as well as the company’s canned hard kombucha and spirits offerings.
“It’s a little bit bigger than a couple of our other locations,” Serrao said. “The front is a very high-end cocktail experience, where you can see and learn about our take on cocktails, and the back is very JuneShine – almost like a surf bungalow.”
JuneShine also operates locations in San Diego and Santa Monica.
The 64-seat Brooklyn space will serve raw bar items at the front, with “boochtenders” educating visitors on bev-alc offerings, while the backroom of the location will host a nightly live vinyl DJ and optional event space. The location also has a micro tank set-up for location-exclusive brews.
“It was important for us to have a brewing component,” Dein said. “We went through a lot of work to be able to put in a micro tank so we’ll have flavors that we’re making that are exclusive to Brooklyn that are inspired by local fruits and spices.
“That was important too – coming in as a Southern California brand into Brooklyn where there’s already amazing craft brewers,” he continued. “We wanted to truly be a craft brewery, not just a tap room.”
The first offering brewed at Brooklyn will be a collaboration with a JuneShine ambassador – a la the company’s previous collaborations with celebrity investors and ambassadors Whitney Cummings and Diplo. The company then plans to collaborate with local breweries and creatives, with the founders calling out the desire to work with Talea Beer Co. and Brooklyn Brewery.
“[Williamsburg’s] a really cool melting pot of fashion and music and culture and even craft beer,” Dein said. “Other Half [Brewing Company] is just down the street and Threes [Brewing], so it’s a really cool mix of cool stuff going on.”