Richard Reed: Innocent Drinks
The Innocent Drinks co-founder on making healthy look cool
Innocent drinks are cool. The smoothies in small plastic bottles with witty alternative labeling are the drinks to be seen with – at almost £2 per 250ml they should be too. But Innocent is no passing fad, for it has succeeded where virtually every nutritionist has failed: making fruit fun and being healthy easy.
Started by three young friends with no sector experience or financial backing, Innocent’s success story is also one being heralded by business press and every awards evening going. It seems everyone wants a bit of Innocent Drinks, so we spoke to co-founder Richard Reed.
“We’re not going to apply for any more awards, we’re worried about getting big-headed,” is the one of the first things Reed says. Acknowledging they’ve had some “great nights out”, Reed appears concerned the extra-curricular activities might detract from running the business: a battle he seems to be constantly fighting but also provoking.
“The three of us at college were always talking about starting a business and did little entrepreneurial things together”, recalls Reed referring to his and co-founders Adam Balon and Jon Wright’s time together at Cambridge. “Adam and I organised club nights, Jon designed the posters and the fliers. We were always talking about how great it’d be to one day run our own business.”
However, starting a business didn’t seem a viable option upon graduation and each went their separate ways into full-time employment. Reed into marketing, Balon and Wright into management consultancy. The dream never went away though, remaining the topic of debate whenever they got together.
“After four years of talking, we decided we should either get on with it or stop talking about it – or we’d drive each other completely nuts,” explains Reed. “We tried to think about what would make a good business. We realised we should do something that made people’s lives a little bit easier or happier in the long term and not something that was a short term fad.”
But making fruit smoothies wasn’t their first idea. Before that came the bath that automatically filled to the desired level and temperature only complicated by the mixing of electrics and water, and then plans to adapt swipe card technology to people’s front doors, ridding the world of the key.
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“We were absolutely sure it would work,” enthuses Reed nostalgically. “But in the end, it wasn’t a technology we’d invented, we knew nothing about it and we realised it’d be hard to convince people to have this big bit of technology built into their doors.”
Instead, the idea for Innocent Drinks came from scrutinising their own hectic urban lifestyles. “We realised that every time we were going on holiday we’d work like mad beforehand and end up feeling totally knackered. We were all working really long hours and finishing at a time when the only place open to get food was the kebab house and it was too late to be bothered to go to the gym.
“We realised if there was a small and easy way of doing something healthy that didn’t take any time we’d do it and so would our friends.”
As they had absolutely no experience in fruit or the drinks market, going from idea to reality obviously involved doing some research. “We went away and just kept buying fruit and making up recipes that we thought tasted good,” recalls Reed. “Then, once we had these drinks that we liked and our friends liked, we just needed to know if other people would go for it.”
Public approval for Innocent came after the now legendary experiment at a jazz festival where the drinks were sold and people asked to place their empty cups in a ‘yes’ or ‘no’ bin to vote whether the three lads should give up their jobs and make smoothies full-time. With the ‘yes’ bin recording a landslide victory they quit their jobs the next day. However, the transition to self-employment wasn’t, well, a smooth one.
“We were hopelessly naïve,” recalls Reid. “We stopped working with just a month’s pay to keep us going, but it was nine months before we were up and running. We totally underestimated how much was involved in the mass production of the drinks as before we’d only ever made small amounts of drink to sell the same day.”
One of the key obstacles was securing finance. Not only did they have a relatively expensive product with a short shelf life and no experience in the sector, it seemed they were in the wrong place at the wrong time.
“It was just at the start of dot com and everyone was saying ‘get into dot coms’; nobody was saying ‘get into fruit juice companies’,” recalls Reed. “All our mates were saying ‘what are you guys playing at? You’re a great team but what are you doing with fruit juices?’ People were saying to us, ‘you’re mad, absolutely mad’.”
Reed admits there was a time even he wondered if they’d be better off joining the dot com masses. “I remember hearing about lastminute.com and thinking ‘Oh my God, that is such a brilliant idea’, and for one minute I was thinking ‘we should do a dot com’. But we thought ‘we still don’t quite understand this world we don’t know how people are going to make money.’ We just liked the fact we had a simple business idea: we put it on the shelf and someone buys it.”
Several months without salaries also took its toll. “We definitely all felt at some point from leaving our jobs that it was definitely not going to happen,” recalls Reed. “My period was about four or five months in and we’d put the deadline back for about the fourth time and I just thought, ‘forget it, this isn’t gonna happen’. We’d completely run out cash because we hadn’t saved up enough money. The overdraft was getting bigger and bigger, I was putting things on the credit card everyday and we did sort of have this conversation where we said, ‘is this it?'”
“This was where being part of a team was critical,” insists Reid. “If you’re in a team you have others to get you through it and say ‘come on it’s not that bad’. I don’t know how people on their own do it’.
In the end, Innocent secured the funding it needed from a business angel but there were still obstacles to overcome.
“Everyone was telling us it wouldn’t work,” says Reed. “Everyone said our idea was wrong. They were saying you have to use concentrated juices to make it cheaper, you have to use preservatives to make it last longer as it’ll be too difficult to distribute. Everybody we spoke to in the food industry said it’ll be too time consuming, too difficult, too expensive and it can’t be sustainable.”
However, Reed insists it was confidence in the product that made them persevere. “We knew people who got to taste our fresh fruit drinks liked them and wanted them and that retailers were happy to stock them once they saw people wanted them.”
“Everytime someone said ‘no’ I just said ‘why not?’ They’d say ‘it won’t work’, I’d say ‘why not?’ They’d say ‘it’s too expensive’, we’d say ‘we know there’s people who will pay it’. It’s a case of overcoming each hurdle at a time.”
Reed’s mantra is one certainly borne out by Innocent’s early days. Distributors initially refused to stock the drinks, so one bank holiday weekend they loaded up a van and took the drinks round delicatessens and health shops in Notting Hill themselves.
“We just said ‘we’re a local juice company that’s just started up, here’s four boxes for free, stick them on your shelves and if they sell give us a ring,” tells Reed.
Over that first weekend Innocent drinks made it into 50 shops and were an immediate success, with 45 wanting more. “We went back to the distributors and said ‘these companies want them,’ and gave them a pallet for free.”
Five years on and 10 million sales later, Innocent drinks are in shops across the country and word is spreading. But despite the overwhelming growth, until last summer Innocent hadn’t spent a penny on advertising.
“We didn’t spend anything,” admits Reed. “First of all we didn’t have the money, but we’ve always said with Innocent the reality and image is one of the same. We believe if we make nice drinks people will tell their friends. We’ve always said we’ve got to be exactly what we are: it’s got to be honest and not high corporate facades.”
However, distancing itself from the corporates is something Innocent seems to spend a lot of effort maintaining. Its witty packaging with ditties such as, ‘separation occurs, but mummy still loves daddy’, Fruit Towers premises, grass covered vans and cow patterned carts provides a studenty alternative image that in a world increasingly disillusioned with Americanisation and corporate power is perhaps as effective a marketing ploy as any other.
Innocent also gives away drinks to the homeless, plants trees, encourages recycling and donates to the third world, while its entire staff are treated to a snow boarding trip every year, awarded £2,000 for the birth of each child and invited to apply for a £1000 scholarship to achieve something they’ve always wanted to do. “Like recording a single or going surfing,” explains Reid.
But when pushed on the motives of Innocent’s almost utopian approach to business, Reed insists he’s very suspicious of ‘social corporate responsibility’ and he and his partners are simply working in a way they think is right.
“We do these things because we want to and because we can, not for any other reason,” says Reed. “I don’t want to be judged as good for doing this stuff on the side, I want to be judged on making the world a tiny bit better by making juices people like and doing it in a socially and environmentally friendly way as possible. And if we give some of our profits to people that are less blessed than we are, it’s because we can and want to.”
Likewise, Reid is adamant Innocent’s attitude towards its staff is simply the way things should be. “It makes absolute business sense. You realise the only determinant on how successful a company is going to be is the actions of every single person. So you have to do your absolute best to get the happiest most motivated team possible.
“You can’t ask someone to go after an opportunity but you can support them along the way. We spend a lot of money on training and creating an entrepreneurial atmosphere where if you want to try and do something you can.”
So what of the future? Reed has dreams of expanding Innocent’s brand across other healthy sectors and can see a day when there are Innocent baby products, Innocent body care and even an Innocent island. But if Innocent does grow up into a multi-product company could it maintain the identity it’s so carefully created? Could a big company still have 75 per cent social space in its offices and table football? “Absolutely”, insists Reed.
“It’s not inevitable you’ll lost it if you get bigger,” he says. “Can we keep it as an informal, ethical open company? It’s a challenge but a core bit of our business strategy: we’ve absolutely got to have it both ways.”
Displaying the resoluteness and reluctance to accept what other people deem ‘inevitable’ that’s got the company so far, Reid says growing larger could even enhance Innocent’s innocence.
“As we go to 40 people we become more ethical. The more people drink our drinks, the more people become more part of it and the more ways we can source more types of fruit and are able to afford people that can worry about ethical values. So we’re becoming more innocent… and anyway, we don’t want to be huge conglomerate.”