The Colgate Scene
July 2006

Thirsty business
Beverage mogul Darius Bikoff creates new market, takes on soda giants

[Photo by Timothy D. Sofranko]

Not long ago, drinking water came in two standard flavors: clean and dirty. After a New York City water scare in the early '90s, J. Darius Bikoff '83 set out to change all that. His search for an alternative to tap and spring water led the young entrepreneur to found Energy Brands (now called Glacéau), his own healthy beverage company, in 1996. Best known for three nutrient-enhanced products, vitaminwater, fruitwater, and smartwater, the company sells more than 500 million bottles annually, and Bikoff, who has garnered industry kudos including being named one of Brandweek's Marketers of the Next Generation, New York's Top Entrepreneurs, and an Ernst and Young Entrepreneur of the Year finalist, has big plans for the beverage industry.

At the Glacéau headquarters in Queens, Bikoff works out of a space owned by his father, a Brooklyn businessman who dabbled in entrepreneurial ventures from scrap metal to boxing matches. Growing up in Manhattan and Sands Point, Long Island, Bikoff discovered his knack for business at age 12 when he began working for his father during summer vacations. His passion for travel, culture, and diversity eventually led him to Colgate, where he incorporated into his English major a personalized study abroad program at the University of London and La Sorbonne.

"It was a great opportunity for me," Bikoff said. During summer breaks and holidays from Colgate, Bikoff returned to work producing soda cans and juice lids in his father's aluminum business. Shortly after graduating, he took over the company and ran it for 10 years before founding Glacéau. Today, Bikoff lives in Manhattan with his wife, Jill, and their baby daughter.

"There is very little distinction between my personal and business life," Bikoff said of how his rounded approach to business and passion for promoting a healthy lifestyle are infused within his work ethic. "I couldn't have made this company if I wasn't one of my own consumers."

Novel product, unconventional marketing
At first glance, vitaminwater looks far too fun to be healthy. The rainbow assortment, from pale lavender to screaming sunshine with flavor names like revive, endurance, and power-c, resembles the bottled equivalent of Lucky Charms. But in fact, two servings have 1/2 the calories of soft drinks and incorporate up to 200 percent of the recommended daily allowances of a plethora of vitamins, minerals, and nutrients that humans need but cannot spell. Instead of packaging and labels that display the typical pastoral images of streams and rivers found on many bottled waters, Bikoff opted for education and humor. With type set all in lowercase, a bottle of multi-v lemonade reads/warns "in a recent government study that cost our country billions of dollars, a bunch of science guys . . . came to this brilliant conclusion: people don't eat right . . . we created this product . . . so you don't feel so bad next time you get an urge to indulge in a bloomin' onion."

"I wanted to talk to people and treat them like they were smart," Bikoff said.

But don't be fooled by the light-hearted label banter; Bikoff is on a serious mission: to oust nutrient-deficient cola competitors from the top of the soda podium. Concerned about the obesity epidemic in America, Bikoff said, "The soft drink industry responds to obesity by saying, 'here's a diet version.' But diet products don't work. The more artificial sweeteners we consume, the fatter we get. You see people with a diet Big Gulp in one hand and a Snickers bar in the other. Ultimately, 'diet' backfires.

"Our challenge is having to communicate a lot of information on each bottle because we want to tell consumers what they should know. Our competitors spend all their time taking out products because nutrients are expensive. It leaves them with very little to explain."

Clear explanation is critical in business leadership and in life, said Bikoff, who noted that his Colgate experience was valuable in shaping his communication skills. "The greatest gift is to articulate an idea. I got that from Colgate."

With health and diet in the headlines every day, Glacéau has seen more than a 200 percent compounded annual growth since the company's inception, and vitaminwater shows a 600 percent increase since its 1998 debut. Celebrities from Sarah Jessica Parker to rapper 50 Cent (for whom the vitaminwater flavor Formula 50 was created) have been seen toting the trendy beverages in public places.

Bikoff is now focused on expanding sales of his products into schools across the United States. His timing may be perfect. In May, the Alliance for a Healthier Generation, an initiative of the William J. Clinton Foundation and the American Heart Association, worked out a deal with the American Beverage Association and three of the top soda makers to replace fattening drinks in school vending machines with low-calorie, nutritious beverages. The shift will affect close to 35 million schoolchildren across the country.

Although public schools in cities like Philadelphia and Los Angeles have already opened their doors to Glacéau products, Bikoff knows what he is up against, and that his products have the attention of the big guys.

"It is very difficult to get distribution when Coke and Pepsi constantly try to knock off our product," Bikoff said. "You can never anticipate obstacles; you just have to be prepared to overcome them." With pride and confidence, Bikoff clearly follows his own advice. This spring, Glacéau filed suit - not its first "knockoff" battle - against PepsiCo, contending that its SoBe Lifewater imitated the recipe and packaging of vitaminwater. PepsiCo settled, agreeing to change its "trade dress." Fame, it seems, isn't limited to humans - it's tough being a popular beverage. "Everyone wants to ride your coattails," Bikoff said.

Bikoff's flair for form and function have also led him to experiment with packaging. "I was cycling in New York, and I wanted something that would fit in the water bottle cage," Bikoff explained. The result was his patent of the shapely 20 oz. bottle, which famed architect Philippe Starck helped to design. Within five years, the vitaminwater bottle was on display at a Smithsonian exhibit of iconic packaging - sandwiched between a Campbell's soup can and a banana.

When he isn't creating new flavors or bottles, Bikoff makes the rounds as a public speaker on the topic of leadership and entrepreneurism. But his life isn't all business. "I'm also the mascot for the 92nd street YMCA bowling league," Bikoff laughed. And what does a beverage mogul drink other than his own product?

"Cabernet," Bikoff deadpanned. "It's very high in antioxidants."

Bertine, a freelance writer and professional triathlete, is currently writing a book for ESPN.
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