Innocent Drinks
PRE-READING ACTIVITY 1: INNOCENT DRINKS
Innocent orange juice Gitte Jæger Nehlsen
1. What do you know about Innocent Drinks?
It a fruit based drink for kids. They also make juice, smoothies and coconut water drinks.
It started in London.
2. Innocent Drinks produce and sell 100% pure fruit smoothies with no sugar or concentrates. Find
out who their competitors on the Danish market are?’
Gennemgået på klassen.
3. The Innocent office, which is called the Fruit Towers, has kept many of the quirks from its young
startup stage, such as an AstroTurf "grass" carpet and a picnic bench breakout area. You can also
still ring up the £19.99 office "banana phone" (a phone shaped like a banana) and chat to the staff.
What does that tell you about the company?’
Gennemgået på klassen.
4. Visit the company's homepage. What is your first impression of the company?
Gennemgået på klassen.
INTRODUCTION: INNOCENT
Anton Hammerl/Topfoto/Ritzau Scanpix
Innocent Drinks was set up in 1999 by the three friends - Richard Reed, Adam Balon and Jon Wright - who met at
university. Back then, juice bars were opening up in London and it struck them that they could not be the only ones
wanting a healthy diet. They came up with the idea of a healthy drink that could be sold in e.g. supermarkets so
they would not have to queue up every morning at a juice bar. They wanted to make a preservative-free, healthy
fruit drink only containing fruit so they experimented at home and came up with their very own fruit smoothie - a
strawberry & banana smoothie.
MISSION: INNOCENT
iStockphoto.com/3D_generator
We believe that everything we make should taste good and do good too. So we try to make it easier for people to
do themselves some good, and to leave the planet a little bit better than how we found it.
www.innocentdrinks.co.uk
Innocent gets a health kick as sales top Tropicana
By Iain Withers 2 July 2017
Innocent's offices look quite ordinary from the outside, perched above a railway bridge in Ladbroke Grove, west
London. Yet inside is exactly the kind of quirky set-up you might expect from the knowingly kooky smoothie maker.
Its young staff gather in a big hall laid with artificial grass to meet, rustle up a free breakfast at a big open plan
kitchen, enjoy baskets of free fruit or play table football. In the corner is a glass box where food scientists, some in
white lab coats, stroke their chins and discuss what fruit-packed concoction will next hit the market.
By the window is a crate full of thousands of little woolen hats knitted by customers to put on bottles, as part of the
company's annual 'Big Knit' charity drive, where 25p from each bottle of mashed fruit goes to Age UK.
Innocent may have turned 18 this year but its chief executive Douglas Lamont is in no rush to take things too
seriously. The company's brand value is as much tied up in folksy marketing and generosity – it donates 10pc of
profits to good causes – as it is in its juices, smoothies and coconut water.
Innocent is coming of age financially, with over half of its record £304m sales for the 2016 calendar year coming
from overseas for the first time, from buoyant businesses in France and Germany. It is also back in the black with
£8.5m operating profits, after a £700,000 loss the previous year, which it put down to expansion costs.
The company is now Britain's largest chilled juices brand, ahead of Tropicana, and western Europe's fastest
growing soft drinks brand, pipping Red Bull. "To become the biggest in the market, an aim you've been going after
for 18 years, on your 18th birthday is something quite special," says Lamont.
What is tough to find at Fruit Towers is any mention of Coca-Cola, the company's owner since 2013. It was a
takeover that dismayed many of its loyal customers, who took to social media to vent their disapproval. Coca-Cola
is based elsewhere in the West End, and describing the relationship between Innocent and its parent, specifically
the extent to which they share the same ethical values, is one of the few things that flusters the earnest and mild-
mannered Lamont.
It's not the only challenge he faces, as he is tasked with expanding a pricey drinks business at a time when
consumers are feeling more pinched for cash. He also has to convince increasingly health-conscious consumers
that its juices really are good for you, after a string of bad press that they contain too much sugar. Has Lamont got
answers to these questions as the company moves into adulthood?
The business was founded in 1999 by three Cambridge graduates – Richard Reed, Adam Balon and Jon Wright –
after selling smoothies at a music festival. Innocent folklore has it that they put two bins out – throw your rubbish in
this one if we should make this our full-time jobs, and the other if not. You can guess which bin was full.
Lamont joined them when they were 50-strong seven years later as "head of new opportunities" after a stint at
another fast-growing company, internet provider Freeserve. He was part of Innocent's top team when Coca-Cola
snapped up a minority stake in 2009 and took full control four years later. The founding trio walked away with a
£100m windfall and handed over the reins to Lamont.
With backing of a global giant Lamont set about launching Innocent in France and Germany. Today those two
businesses turn over €71.1m (£62m) and €86.5m (£75m) respectively and the business as a whole has tripled in
size. Overall sales were up more than £50m last year, with overseas sales up 35pc and UK sales up 11pc.
Revenue is heading for £350m this year, Lamont says, and the business is eyeing further launches in Norway,
Sweden, Spain and Italy.
He says Coke's ownership has allowed the company to take on upfront risks and costs associated with expansion
that it would not otherwise have been able to do, but has nonetheless self-funded all its growth. He insists Coke
largely leaves him to "get on with running Innocent as a standalone business". Innocent does not leverage any of
Coke's vast manufacturing, sales or marketing resources and Lamont says he only formally meets them three
times a year at investment board meetings.
Lamont argues Innocent's growth story is proof "sustainable capitalism can be scaled". The company prides itself
on its green, ethical and healthy credentials, as well as its charitable giving, which has topped an impressive £15m
over 18 years. Undoubtedly 'doing good' plays a big part in Innocent's brand value and in its bond with customers,
as Lamont explains: "Frankly when you're called Innocent you have to work hard to make sure you live up to that
name. We work very hard every day to earn that trust."
A British supermarket shelf
Gitte Jæger Nehlsen
But given the remainder of its profits go to Coca-Cola, a sugary drinks corporate that has faced criticism for
unethical practices in the past, does Lamont believe the two organisations share the same values? Could
the halo that takes pride of place in Innocent's logo sit just as easily above Coke?
"I think like all companies in the world they're looking at how they continue to drive and get better at all the
challenges that face all of us," he says.
This isn't exactly a yes or no – is Lamont saying Coke can't share in the glow of Innocent's halo?
"I definitely won't say that," he starts hesitantly. "The answer is they have a set of values that they're working hard
to deliver against, and we have a set of values that are different and you make different business choices in the
same way that other businesses have different values and make different choices.
"So, inside Coke they are doing so many good things, they are making their business more sustainable, more
ethical, giving huge amounts of money to charity all over the world – a lot of that is unseen as it's not an interesting
story. I wouldn't in any way want to imply they're not doing an amazing job, they really are.
"What we stand for and how we're seen by our drinkers is what Innocent stands for and that's a different thing. You
learn from each other. All companies should be sharing and learning about the many challenges we all face."
Another challenge for Innocent is persuading customers its products are healthy in the face of multiple reports and
studies that have shown smoothies pack a lot of sugar, perhaps as much as a Coke, given the multiple fruits
needed to make a single bottle.
"Yes absolutely our products are healthy," Lamont says. "They have no added sugar, so any sugar in our products
is truly intrinsic in the fruit and in any smoothie or any juice there is a complex web of benefits whether it's through
vitamins or whether it's through phytonutrients". He also points to the fact the government has kept juices and
smoothies in its five a day campaign.
Meanwhile, given the expected squeeze on consumer spending widely predicted, can a pricey drinks business
continue to expand? Lamont says it can because he believes there is an unstoppable trend among Europeans for
healthier living.
"The £10 our customers are saving on their Uber taxi versus a London black cab they are either choosing to put
towards a gym membership or better quality food and drink rather than spending an extra hour in the nightclub.
And you see that trend emerging all over Europe."
He says the company will stay ahead of hot competition by "continuing to innovate". It already launches between
15 and 25 products a year, two years ago it was super smoothies and coconut water, both of which have proved
successful, and four months ago it was a new range of protein smoothies.
Coke-related awkwardness aside, Lamont seems determined Innocent will continue to live up to its name.
Iain Withers: Innocent gets a health kick as sales top Tropicana. telegraph.co.uk, 2. juli 2017. © Telegraph Media Group Limited 2017
COMPREHENSION QUESTIONS: INNOCENT GETS A HEALTH KICK AS SALES TOP TROPICANA
1. Innocent's brand value is tied up in among other things generosity and charity. Please give
examples of that.
- ”Big Knit”, where they give 25% of each bottle of mashed fruit to age UK
- Give 10% of their profit to charity.
2. Please give an account of Innocent's financial situation (2016) as well as its market position in the
UK and abroad.
- Number two next to red bull in the Western Europe.
- They sold for 304 million pounds. Profit 8,5 million pounds.
3. Why was the Coca-Cola take-over in 2013 controversial?
- Because Coca-Cola is an unhealthy brand with a lot of sugar in their products. Which is opposite of what
innocent is.
4. Which challenges do Innocent face?
- They have bad press and costumers feel that they can’t afford it.
5. What are the advantages of Coca-Cola being Innocent's parent company?
- Money invest – expand. Global brand. Take bigger risks.
6. Lamont argues Innocent's growth story is proof "sustainable capitalism can be scaled". Please
comment on this quotation.
- You can be socially responsible and still grow big. Good companies can grow and big companies can
still be good.
7. What does Lamont say about Innocent and Coca-Cola's set of values?
- They are different from each other. But he tries to say that is not a bad thing.
8. What is the "five a day" campaign and how it that relevant to Innocent?
- The parliament says you should eat 5 fruits a day. And innocent is made of fruit.
9. Can Innocent continue to expand?
- Yes. They can expand by keep innovating.
QUESTIONS (DIG DEEPER): INNOCENT GETS A HEALTH KICK AS SALES TOP TROPICANA
1. How would you characterise the company culture at Innocent? (use the text and
visit innocentdrinks.co.uk for inspiration)
2. What is the Big Knit and Age UK?
3. Why is the company called Innocent and does it live up to its name, in your opinion?
4. What does Coca-Cola do to be more sustainable and ethical and why have they been criticised for
unethical practices in the past?
5. Give a brief account of Innocent's history from the beginning till the Coca-Cola take-over in 2013.
DEFINITIONS: INNOCENT
1. What does it mean that a company is socially responsible (CSR)?
2. Give examples of companies that you consider socially responsible and state your reasons.
3. Define the following words and make a sentence with each word:
a. Sustainability
b. brand value
c. operating profit
4. What does this expression mean? To be back in the black (paragraph 5, l. 3 - "It is also back in the black
with £8.5 m operating profits.")
