When Kara Goldin founded Hint Water in 2005, it wasn’t because of a lifelong mission to start a sugarless beverage company.
Goldin, a mother of four, had left her job as vice president of shopping and e-commerce partnerships at AOL to spend more time with family and had developed an affinity for Diet Coke in her downtime. She gained weight, felt fatigued, and even developed acne. When she ditched the Diet Coke for a regimen of water flavored with fruit, she said she lost 27 pounds in three weeks.
That gave her the idea to create waters flavored with fruit oils instead of pulp to cut out sugar for consumers who also wanted to get healthier.
“I never dreamed of starting a beverage company. That was not me, at all. My initiative really started with me not feeling that great,” Goldin tells Fast Company.
Ten years later, Goldin says Hint Water is on track to double its 2014 sales, which clocked in at more than $40 million. In the first quarter of 2016, Hint–which counts investments from Verlinvest and John Legend–will be a profitable company with products sold in more than 35,000 stores in the U.S. In 2014, the company launched a direct-to-consumer business whose sales have doubled every month since launch, Goldin says. And in September of this year, the company rolled out a line of all-natural caffeinated waters, Hint Kick.
Here’s how Goldin has steadily grown Hint while the big beverage companies scramble to shore up falling sales:
Goldin wants to grow Hint into a billion-dollar company. But to do that, she isn’t trying to put Hint on every grocery shelf.
“The way that I have chosen to grow this has not been, let’s grow this really fast and get it into as many places as possible. I don’t think you can do that model and grow a brand that sticks. For me, it’s really been about this balance of growth with brand,” Goldin says.
Instead, her team has thrown their efforts behind making Hint a meaningful brand, and has been selective about the retail stores they sell in.
“I always tell other entrepreneurs, ‘It’s really great if you get the call from H-E-B in Texas that you’re going to go in every one of their stores. But if their consumer doesn’t really understand what hemp milk is, you’re going to fail. And you don’t want to fail. Are there certain markets where it makes sense to be in first and get that consumer used to what you’re doing and what you’re selling?'” Goldin says. “Sometimes it just takes time, and you just have to really babysit it and incubate the brand in a proper way. And I think that’s really what we’ve done.”
Along the path of Hint’s growth, Goldin has had plenty of opportunities to partner with established brands–and she’s had the wherewithal to say no when the fit wasn’t right.
When a prominent beverage company known for its K-Cups for the Keurig brewing machines came knocking last year with an offer to create cups out of Hint’s flavors, Goldin decided the deal wasn’t right for her company. She saw that the company was also producing pods for a major soda company, which ran contradictory to the mission of Hint.
“Where there’s an anchor partner that is really kind of polar opposite to what we’re trying to sell, how much attention are we going to get in terms of the marketing messages in their launch?” Goldin says. “They were not going to be that partner that was going to talk about, ‘We’re now bringing bubbles into your house without sweeteners,’ because that would really piss off Coke or Pepsi or whomever.”
Goldin runs a tight ship with regards to Hint’s marketing, too.
“You don’t see Hint at events where they’ve got an active Diet Coke marketing or Monster Energy. Basically, we end up taking over the events from the sampling or marketing opportunity, or we don’t do it at all,” she says.
Before Hint became a “category-defining” beverage with its own e-commerce store, Goldin had to figure out where to launch the beverage.
“We really tried to figure out, based on what we know about our consumer, whether or not the consumer eight years ago was ready for a product that didn’t have sweeteners in it. We didn’t want to fail in these stores,” Goldin says of conventional grocers like Publix and Kroger. It turns out, they weren’t ready.
“The number of buyers when I first started that said, ‘Oh, this is just like Vitamin Water, right?’ And we’re like, ‘No.’ We really had to define it for the buyers that this was different. And unfortunately, many of the buyers didn’t have room to actually bring in a new category on the shelf, especially in conventional groceries. So we waited to go into conventional groceries,” Goldin says. “If we would have added sweeteners to our product, whether it be, at that time, an aspartame or a NutraSweet, then we probably would have gotten shelf presence faster. But whether we would have defined a new category–we absolutely wouldn’t have. And we would be competing against the Vitamin Waters of the world. And that’s really what we didn’t want to do.”
While Hint is now sold at Kroger, Publix, and other conventional stores, Goldin first launched the water at specialty grocers like Whole Foods, Harris Teeter, and Fresh Market, which continue to be strong sellers for the brand. After that came a partnership with Amazon, and in 2014 Hint began selling direct to consumer.
Through that new customer experience, Goldin got feedback from buyers like cancer patients who credited Hint with helping them cut out sugar during painful recovery. The company recently inked a deal with FoodBuy’s Morrison Healthcare–the hospital food service operator–to offer its waters in all of the company’s serviced hospitals.
“There was a lot of data that we weren’t ever going to be able to get from Amazon, and certainly don’t get that data back from stores, because they don’t have that connection with the customer,” Goldin says. “So we decided to launch our own e-commerce initiative, which is telling us a lot about how Hint is helping this customer get healthy, too, in their own way.”