The beverage industry, one that was thought to be slowing in recent years, has had an unprecedented pickup over the last half a decade. With the influx of new “health”-oriented beverages using strategic social media marketing and branding, the importance of intellectual property in protecting both the branding strategy and formulation of beverage upstarts has grown significantly in its importance.
Poppi and Olipop are two of the most formidable new entrants in the market. Both marketed as “prebiotic” sodas, with very different aesthetics and branding strategies, their profitability has skyrocketed as a result of their strategic use of trademarked assets and formulation-backed marketing claims. In a report from Bloomberg, Olipop discussed its $500 million expected sales expected for 2024, double what they saw in 2023, and a significant increase from its sales of less than $1 million in 2019. In 2022, they reached a growth figure of 148% year-on-year, with over 250% growth online as a result of their marketing tactics. Similarly, Poppi holds a market share 1.5x the size of Coca-cola’s on Amazon, and raised $52 million in financing across 3 separate rounds. For many, the trademarked designs, graphics, and slogans employed by these companies (and many competitors, such as United Sodas) are the primary deal-makers when it comes to direct-to-consumer marketing. This marketing tactic’s success is reflected not only in sales figures and growth, but in online interest. Glimpse, a web analytics firm that tracks consumer interest and trends through aggregation of consumer browsing data across consumer and web search platforms, noted a respective 108% and 227% growth in search popularity for both Olipop and Poppi sodas from 2019 onwards.
While such marketing tactics show success in generating consumer interest and driving higher purchase conversion rates, the primary issue within such a method is that it relies highly on protecting brand image through trademarking assets and patenting unique formulations. Poppi and Olipop have very slim but significant differences within their formulations. While they both use different forms of Inulin (a fiber that feeds micro-organisms required for a healthy digestive system), Poppi includes additional ingredients that have reported benefits when it comes to overall health that substantiate their trademarked claims. However, more relevant than patenting such formulations is managing the IP surrounding their packaging, branding, and marketing claims. Olipop has over 15 trademarks and copyrights registered with the USTPO, as does Poppi. Using these trademarks and copyrights prevents lookalikes from taking advantage of the unique branding strategies used by the brands to differentiate from their competitors, as high recognizability is what drives sales for such brands.
As IP assets drive value for these brands heavily due to their reliance on image as opposed to function primarily, it is important for them to protect their IP assets and manage their portfolio such that the costs of litigation and trademark protection do not outpace their sales. Tools such as patlytics.ai are key for preventing upstart brands that are catching up to legacy brands from falling behind in terms of revenue. By shortening the drafting, infringement analysis, and validity checking process, patlytics.ai enables startups in highly competitive industries to streamline their IP portfolio and maximize their budget usage possibilities to enable rapid scaling.
