“I’m your typical young, successful businessman,” says soft drink tycoon Randy Miller in a 1980’s clip from “Lifestyles of The Rich and Famous” that proves him to be anything but.
Over the course of four and a half surreal minutes, the 24-year-old president and co-owner of Original New York Seltzer arrives at the company’s headquarters on a roaring Harley-Davidson and struts through the office with a leashed Bengali tiger. Though he “lives a lifestyle that many rich rockers score songs about,” Miller is, in fact, a “hard-nosed businessman,” the show’s narrator informs us. Before the clip is done, we also learn that, when not wrestling big game cats, this businessman enjoys driving nitro-fueled drag racers and performing daring stunts for elaborate commercials featuring his flavored fizzy water brand.
Colorful details though they are, Miller’s legacy is larger than his bizarre-o lifestyle; bigger, even, than the decidedly ‘80s mullet he sported at the time — because Miller’s Original New York Seltzer offered Americans the first notable introduction to flavored seltzer water.
Brands like LaCroix, Perrier, Polar, and Spindrift would eventually usurp Miller’s throne, taking the category from hundreds of millions to billions. The waves they’ve made in the non-alcoholic beverage space over the past decade are undeniably impressive. But the category’s influence on booze is perhaps even more remarkable. For, without the rise of sparkling, non-alcoholic flavor water, we may never have seen the introduction of White Claw, Truly, and the scads of other hard seltzers that have all but overrun the market today.
So ubiquitous are flavored water brands on supermarket shelves, it feels like they have simply always been there, waiting to inspire one of the fastest-growing alcohol innovations in living memory. Instead, the rise of flavored fizzy water — and by extension the foundations for hard seltzer’s success — is a decade’s long tale of shifting consumer trends, innovation in the flavor industry, and canny social media marketing. And it all began with a Los Angeles high school graduate who dreamed of Hollywood rather than hard seltzer.
“The rise of flavored seltzer starts in Los Angeles with Randy Miller,” says Barry Joseph, author of “Seltzertopia: The Extraordinary Story of an Ordinary Drink.” Miller graduated from high school in 1982 with ambitions of becoming a stunt double. Concerned at the prospect, Miller’s aerospace engineer father Andy took the budding Evel Knievel out to Brooklyn, N.Y., to inspire a more stable means of making a living.
The family had historical ties to the beverage industry on the East Coast, with the elder Miller’s grandfather Jack plying a trade in selling flavored syrups and seltzer on the streets of Brooklyn. Miller Sr. recalled the days when Jack would bring home the ingredients for the family to make soda. “It was so fresh, but not overly sweet,” he told The Los Angeles Times.
The father-son duo recreated the formula and began bottling it for commercial sale. After initially commissioning the same Brooklyn plant that supplied Jack Miller, shipping to the West Coast proved too costly, so the Millers moved their operation to a plant in Santa Fe Springs, Calif.
Original New York Seltzer quickly stood out as what would these days be described as a “disruptor,” and only partly because of its eccentric teenage co-founder. Though Miller Jr.’s early delivery vehicle — a convertible Mustang — was characteristically odd, the seltzers were packaged in unusually squat clear bottles. That the liquid inside was clear but brimming with flavor was another stark departure for the times, as was its placement in the beer rather than soft beverage aisle.
“Within three years it was a hundred-million-dollar company and it had created an entirely new niche in the marketplace called flavored seltzer,” says seltzer writer Joseph.
With sales rising from 1,000 cases per month to roughly 1 million by 1985, brewing giant Anheuser-Busch tried to scoop up the brand. But the deal hit a major snag when suitable positions couldn’t be found for the father-son duo. “They wanted a major role. Anheuser-Busch doesn’t take something on and then not run it themselves,” Theodore Kneidl, a former vice president for the brewer, later recalled.
The company’s fortunes ultimately fell flat almost as fast as its effervescent rise. By the early ‘90s, Original New York Seltzer faced bankruptcy, and the Millers lost their brand and trademark. Miller Jr. was allowed to keep the lions and tigers amassed during the golden years (they were “considered a liability and not an asset,” he told Esquire), and he launched Predators in Action, a company that provides studio-trained exotic animals for film and television.
A New Wave of Seltzer
In truth, Original New York Seltzer is only partly responsible for today’s seltzer craze. While it popularized flavored fizzy water, reaching drinkers in dozens of states and even internationally, the liquid was packed with fructose and arrived at 80 calories per 10-ounce serving. Instead, it was another brand from the ‘80s that, after (barely) surviving for years under the radar, would eventually shepherd in the modern-day flavored seltzer formula.
Launched as a side project by Wisconsin’s G. Heileman Brewing Co. in 1980, LaCroix got off to a rocky start, changing hands numerous times before landing at its current home, Florida’s National Beverage Corp., in 1996. The new acquisition reenergized the company’s billionaire CEO, Nick Caporella, who involved himself in every aspect of the brand from packaging design to marketing and flavor development.
Even then, it took more than a decade before the product’s bone-dry, lightly fruity flavor matched mainstream palates. In 2006, soda sales fell for the first time in 20 years, according to data from industry publication Beverage Digest. And not until 2013 did LaCroix start posting double-digit volume growth, per a Bloomberg deep dive on the brand.
“The consumer said, ‘I’m not gonna drink soda,’” says Marie Wright, chief global flavorist for Archer Daniels Midland (ADM), a company that creates the natural flavors used in the food and beverage industry, as well as many others. “Whether it was with sugar or sugar-free didn’t seem to matter, it just got such a bad rap.”
In flavored seltzer waters, those turning their backs on soda found a natural home. “The very approachable flavors met the needs of millennials seeking experience through flavors,” explains Nielsen analyst Danelle Kosmal. “[A]nd the zero-calorie offerings met the growing needs of health and wellness trends.”
But LaCroix’s success proved to be more than the product of these factors alone. It’s no coincidence that the brand’s rise coincided with the rapid uptake in use of Instagram, which had hit 100 million monthly active users by 2013. Rather than traditional marketing, the brand leaned heavily into the platform, Joseph explains. And instead of pushing campaigns itself, LaCroix let customers spread the word through participatory marketing.
“It wasn’t just something to drink because it tasted good,” says Joseph. “It was a lifestyle decision. It was an aesthetic decision. It defined you and how you represent yourself to others.”
And which early Instagram-adopting millennial wouldn’t want to align with a brand that marketed its grapefruit water as “Pampelmousse,” and sold the better-for-you soft beverage in striking, brightly colored cans? Little did it matter that they flowed from Fort Lauderdale, Fla., rather than France.
Letters of recommendation in national newspapers offered further legitimacy. But it wasn’t all plain sailing for LaCroix. As sales rose, Caporella became increasingly controlling, former employees told Bloomberg. Three senior employees left the company in 2016, with trade publication BevNet describing the fallout a “National Exodus.” Caporella became embroiled in a string of lawsuits, and while allegations — of “improper touching” amongst other things —were ultimately retracted, sales eventually started to slow.
While the brand grew 38 percent in the 52-week period ending in May 2018 compared to the previous year, growth rates slumped to 5 percent over the next 12 months, according to Nielsen data. In 2019, analysts described LaCroix as being in a state of “free fall,” with the poor performance chalked up to increasing competition and “lack of meaningful innovation.”
But don’t expect Caporella to be training tigers any time soon. Shares in National Beverage, which trades as FIZZ, bubbled up to $91 a pop in January 2021, equating to a market cap of around $8.5 billion. The company’s valuation has since settled to a more modest, though still entirely impressive, $4.6 billion.
If Original New York Seltzer helped pave the way for LaCroix, the National Beverage brand unquestionably laid the foundations for regional favorites like Polar to go national, and helped turn startups such as Spindrift into darlings of the venture capital world. But major contributions from the industry that supplies perhaps the most important ingredient for flavored seltzer cannot be overstated in the category’s rise.
“I never tasted LaCroix 30 years ago, but I’m pretty sure because of my knowledge of flavor that it wouldn’t have been as refreshing and as delicious as they are now,” says ADM’s Wright.
The quality of natural flavors has noticeably improved over the past three decades, thanks to technological advances and more sophisticated techniques for isolating specific compounds, Wright explains. Recent years of increased demand for natural flavors have only spurred producers to put more resources into development.
“The flavor industry boosted the flavored seltzer water industry, and vice versa,” she says. “Then, of course, the alcohol industry found that people don’t want to drink beer anymore, and they jumped on the bandwagon.”
Connecticut-based beverage entrepreneur Nick Shields would surely have been aware of flavored seltzer water’s potential when he launched SpikedSeltzer in 2013. Later rebranded as Bon & Viv (and then BON V!V), Shields’s company marked the first mutation of flavored fizz to today’s boozy seltzer water. And while he’s cited the vodka soda as his original inspiration, Shields’s resume included stints developing products for Pepsi and Schweppes before he played his own part in changing the way American’s drink.
Of course, SpikedSeltzer wasn’t the first flavored, sparkling brewed beverage to launch in the U.S. That distinction goes to sweeter, flavored malt beverages like Zima, which gained quick traction then died out just as fast in the early ‘90s (much like Original New York Seltzer).
Whether serendipitous or otherwise, SpikedSeltzer proved to be a case of the right product at the right time — as did the launch of Truly and White Claw, both of which followed quickly on its heels and now dominate the category.
Consumer demand for better-for-you low- and no-calorie products had already been cemented by the mid-2010s. The flavor producers serving that industry were rapidly improving their operations. And mainstream palates had long been primed for lightly flavored drinks once mockingly described as sipping carbonated water while someone in an adjacent room shouts the name of a specific fruit.
In case any doubts over the passing of the seltzer baton remained, comedian Trevor Wallace memorably confirmed it in the viral video that will forever be remembered as hard seltzer’s arrival on the drink’s stage. Says Wallace, “If you think about it — La Croix, it’s just a virgin White Claw.”