On the flameout scale, Snapple measured 9.9. Within four catastrophic years, the quirky all-natural beverage company — which had been so hot in 1993 that Quaker Oats paid $1.7 billion to snatch it up — had lost its edge, forsaken its customers, and forfeited its brand value. By early 1997, Quaker was lucky to unload it for $300 million to Triarc Companies Inc.
Most industry insiders began writing Snapple’s obituary well before Triarc entered the picture. In a marketplace littered with broken-down, abandoned brands, Snapple looked like the next big loser. That is, until Michael Weinstein took command.
Then CEO of the privately held Triarc Beverage Group, Weinstein headed a turnaround mission that made Snapple a contender again. Under his guidance, the fruity beverage won back the trust of distributors and consumers, scored big with adventurous new products, and learned to have fun again. Weinstein brought back Wendy Kaufman, the saucy employee who starred in Snapple’s delightfully irreverent ads during the early 1990s. He unveiled two risky product extensions: earthy teas called Elements and fruit smoothies called WhipperSnapples. And he made Snapple fiscally viable again, ultimately selling the brand for an estimated $1 billion to Cadbury Schweppes in October 2000.
“More important than building a brand, we built a company with strong values, led by a group of talented managers,” says Weinstein, now president of global innovation at Cadbury Schweppes. “We breathed life into our mission: We make beverages exciting.”
Here, Weinstein explains how he and his team at Triarc put the snap back in a celebrated brand whose appeal had gone flat.
Don’t Go Changing
When Arnold Greenberg, Leonard Marsh, and Hyman Golden began selling fresh apple juice out of an old pickle store in Queens, New York 30 years ago, they distinguished their brand by playing up its quirky, brazen personality. They recruited radio personalities Howard Stern and Rush Limbaugh to hawk Snapple on air. They distributed the drink to delis and diners rather than to large-scale supermarkets. And they plucked Kaufman from the order-processing department to star in television commercials as “the Snapple lady.”
By all accounts, Snapple was a homegrown brand having fun in an industry dominated by the same tired tactics. Then, in 1993, Snapple’s founders decided to step aside — and sell the company to bigger players who could take it worldwide. That’s when Quaker Oats, fresh from its marketing victory with Gatorade, snatched up Snapple for $1.7 billion.
Almost immediately, Quaker fired Kaufman, Stern, and Limbaugh. It herded Snapple back into the mainstream with marketing and distribution plans that followed all the industry rules. During its tenure with Quaker, Snapple sales declined 20% each year — dropping from $674 million in 1994 to $440 million in 1997. By the time Weinstein’s team bought it in 1997, the brand was unrecognizable to its early adopters.
“Essentially, we built our entire revival strategy around a push to reverse Quaker’s policies, to revert to Snapple’s original tactics, and to return to the company’s roots,” Weinstein says. “Quaker fired Rush Limbaugh, so we hired him back. Quaker fired Wendy Kaufman, so we held a parade to celebrate her return.”
Weinstein says that he worked hard to maintain the brand’s personality during the 2000 purchase of Snapple by Cadbury Schweppes. He tells the story of the first time he met with Snapple’s potential British buyers … dressed up as Queen Elizabeth. “I told my people, ‘See, I told you the Cadbury people won’t make us change,’ ” he says.
And though Weinstein has moved from CEO of Snapple to president of global innovation at Cadbury Schweppes, he continues to promote and live the Snapple way of life. “I meet every new employee,” he says. “We have lunch every couple of weeks.”
Make a Splash
Reviving a dying brand is no laughing matter, but Weinstein says that he didn’t know how to do the job without having a good time. When former marketing director Ken Gilbert suggested that Snapple bring back Kaufman as spokesperson by putting her face on a new drink, Weinstein didn’t just give him the go-ahead. He approved Kaufman’s welcome-back commercial and ran a parade down Fifth Avenue celebrating Wendy’s return and a new flavor: Wendy’s Tropical Inspiration.
After wowing customers with its renewed sense of fun, Snapple turned to its distributors. In the beverage industry, distributors hold the key to sales and profits. If they love you, you will thrive. In early 1997, love was not the four-letter word distributors used to describe Snapple. They were unhappy with policies enacted during the Quaker reign, and they needed some reassurance from Weinstein and his team.
“Five of us from senior management made a presentation to the distributors shortly after Triarc bought Snapple,” he says. “We each learned a magic trick to correspond to the theme of our talk. I made money appear in a box. And I told the distributors, ‘The magic is back!’ ”
Weinstein was right. During the second half of 1997, sales stopped tanking. The following year, they began picking up steam, moving up a positive incline with the introduction of the Elements brand extension and then the WhipperSnapple fruit smoothies.
Just two weeks elapsed between the time Triarc officially purchased Snapple and Wendy’s Tropical Inspiration parade. All told, it took just 10 weeks for the drink to move from idea conception to deli shelves — an absurdly short production cycle in any industry. But that’s now par for the course at Snapple headquarters, where new drinks are dreamed up daily.
“We create products really fast here because we don’t waste a lot of time doing test marketing and research,” Weinstein says. “If you maintain high standards of quality and work with existing packaging and combinations of known flavors, there’s no reason you can’t rock really fast.”
Today, Snapple offers 50 different flavors of teas, lemonades, fruit juices, diets, smoothies, and Elements. And in 2002, Weinstein says that the company will introduce a variety of new drinks, including a red-apple drink called Snapple Apple, Snapricot Orange, Very Cherry Tea, Lime Green Tea, and Diet Lime Green Tea, as well as an enhanced water fortified with vitamins.
And how does Snapple conjure all those wacky new flavors? It asks the experts: its employees.
“Once a year, we ask employees to bring in drinks that they make at home or that they think are really cool,” Weinstein says. “We go down to the lab with all those ideas, everybody drinks the tests, and we write ideas on the walls. We’ve gotten great ideas from the accounting department, the operations group, and even the vending guy.”
A few years back, a member of the vending team came up with the name Zotics for a new line of fruit drinks. Snapple sent him and his wife on a weekend cruise.
Talk Amongst Yourselves
Internal communication remains a big priority for Weinstein in his new role. As president of global innovation, he oversees the Dr. Pepper, 7Up, and Motts brands, as well as Cadbury’s European and Australian beverage and confectionary divisions. “I’ll be trying to coordinate the groups and keep them up on major trends in the food and beverage area,” he says, “My consumer insight team will need to share the knowledge we’ve gained on a global basis in order to grow all the brands.”
Weinstein’s knack for open communication helped smooth the transition when Cadbury Schweppes first made its bid to buy Snapple two years ago. Considering the damage done by Quaker before Triarc’s rebound, most employees took the news of a new parent company badly. “My job was talking people off the ledge for a few months,” says Weinstein, who worked to improve morale and internal dialogue as the senior vice presidents of marketing and sales, among others, left the company.
“I called in all the employees and told them the truth,” Weinstein says about the announcement of Cadbury’s $1 billion offer. “I told them the benefits of being owned by a beverage company rather than by a financial company. I explained that this deal would mean more resources and opportunities for people. I also told them that some employees would lose their jobs.”
The result of Weinstein’s straight talk? Great staff morale and a low turnover rate. No one wanted to leave; things were just getting good. And now it seems as if they’re getting even better. Stay tuned.
Anni Layne Rodgers is the Fast Company senior Web editor. Linda Tischler is a Fast Company senior writer. Learn more about Snapple on the Web.