Celestial hopes rest with Sleepytime ‘shot’

BOULDER — The Celestial Seasonings’ Sleepytime bear is getting into the “shot” business.

You read that correctly. The Sleepytime bear is now being packaged on the front of a 2.5-fluid-ounce bottle as the face of the new Sleepytime Snooz Natural Sleep Aid. He’s being marketed on Amazon in a two-pack carton and sitting on the pharmacy shelf at Walmart.

At the same time, Boulder-based Celestial Seasonings is holding a double-blind, placebo-controlled test so that consumers know they can trust what they’re getting in the new “shots,” said Blake Waltrip, chief marketing officer at Celestial Seasonings, which is a division of The Hain Celestial Group Inc. (Nasdaq: HAIN) based in Melville, New York. The shots come in peach, berry and lemon ginger flavors and sell for $2.99 apiece online.

Once the trial for the herbal supplement is complete, Celestial plans to publish the results on product labels, Waltrip said. The “shot” features melatonin and valerian — ingredients found in other sleep aids. The trial is designed to show that the Sleepytime Snooz products help users fall asleep faster, stay asleep longer and have a better quality of sleep, Waltrip said.

Dietary supplements are not regulated by any governmental agency in the United States. Even so, holding a trial can help build the brand, Waltrip said.

With 71 percent of Americans saying they have some sort of sleep issue but just 19 percent reporting they take something to address it, “there’s a huge upside” to the sleep-aid market, Waltrip said. He declined to discuss the financials involved in launching the Snooz “shots” or Celestial’s other two new “shot” products — the Enerji Green Tea Energy Shot and the Kombucha Energy Shot.

“Sleepytime turns 40 years old this year. It’s trusted,” Waltrip said. “We make sure that the things we put in Sleepytime actually work and do what they say.”

Many customers looking for help with sleep issues report using over-the-counter products such as Benadryl and Tylenol PM, Waltrip said. Both pharmacy products tend to leave people feeling more groggy in the morning than they would if they didn’t take anything, he said.

“Our research shows consumers would love a natural alternative,” Waltrip said. “This (Sleepytime Snooz) leaves you feeling more refreshed.”

Celestial certainly is not the first company to hop onto the “shot” bandwagon, but it’s expected to do very well with the trend, said Brendan Synnott, founder of Revelry Brands LLC in Boulder. Synnott also is known in the food industry for working with a partner to turn Bear Naked into a $65 million brand in a five-year period.

“For (Celestial) to provide functional benefits in a form that’s slightly more relevant to the times, makes sense, and they have the brand equity that (makes them) more credible than most,” Synnott said.

“Shots” in general, including energy shots, are expected to become “an explosive category” in retail, Synnott said. “We’re just in the beginnings of it being developed properly.”

Celestial has been a category leader in the herbal-tea industry for years, offering continued growth over time, Waltrip said. The new “shot” products are planned to bring new customers to the brand, he said.

“We believe it’s a nice fit for the brand,” Waltrip said. “We’re excited for the opportunity to drive new products into ‘need states’ for the consumer.”

Hain/Celestial reported global net sales of $359.8 million in the most recent quarter, a 25.4 percent increase over net sales of 286.8 million for the same quarter a year earlier. The company’s growth came from continued sales momentum in the natural and organic sector across a variety of stores as well as strategic acquisitions, the company said in documents filed with the U.S. Securities and Exchange Commission.

In addition to Celestial Seasonings, Hain owns and markets the brands Arrowhead Mills, Earth’s Best and Garden of Eatin’ among others. The investment fund of stock market investor Carl Icahn owns about 16 percent of Hain, according to SEC documents.

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