Test market shocker: Reno isn't crazy about Las Vegas

Gary Larsen, co-founder of the energy drink King 888, finds irony in the fact that northern Nevada was the test site for a product that promotes a high-rolling Las Vegas lifestyle.

Since introducing King 888 late in 2006 Larsen and a public relations team from R&R Partners in Reno have learned a great deal about the highly saturated energy-drink market. For starters, they found that the majority of northern Nevadans don't care much for southern-Nevada branding.

"The Las Vegas association for most people is very positive, particularly when talking about international markets," says Larsen, chief executive officer of the company. "But we learned no place is less open to Las Vegas than Reno. People in California love Las Vegas, but people in Reno have very ambivalent feelings. In one sense a Las Vegas-centric brand would have more challenges (in Reno) than anywhere else, but we found there is a great deal of affection for the brand."

Larsen likes Reno as a test market because it represents an excellent demographic: it's middle class, it's racially diverse, and it's not San Francisco. With the product originally slated for a national rollout this fall, Larsen says he held off until January because his distributor, Southern Wine and Spirits of Nevada, focuses almost entirely on holiday liquor sales during the fourth quarter. King 888 will roll out nationally starting in Las Vegas.

Although energy drinks crowd the shelves of convenience stores across the U.S., Larsen says most companies have little presence overseas.

King 888 intends to hone its brand nationally for several years and then try to penetrate overseas markets such as China, the Middle East, Mexico - "markets that are responsive to the concept of a classic American brand," Larsen says.

To reach a broader audience they shunned the edgy branding found on competitive drinks such as Rockstar Energy Drink, Hansen's Monster, or SoBe's No Fear.

"Everyone is trying to be way out there," Larsen says. "Brands cater to a college-age crowd, but the category is maturing. The typical consumers are primarily males over 35 years of age, but the brands are trying to talk to you like an 18-year-old. Nobody's just sort of normal and speaking more to a mainstream audience.

"Guys who are 50 years old are not going into a meeting with a can of Monster. King 888 tries to fill that void as a classic American brand," he says.

King 888's first-generation packaging more than slightly resembled a can of malt liquor and led to some embarrassing moments as a result.

"I had mothers stop me when we were handing out samples and tell me how offensive it was we were handing beer out to kids," Larsen says. "We knew that we needed to work on that with R&R."

The team changed the product's look to more clearly identify it as a non-alcoholic beverage. Tim O'Brien, creative director at R&R, says the newest King 888 design offers a happy medium.

"People will feel OK driving around and not worry they are going to get pulled over for looking like they are drinking an Olympia beer," O'Brien says.

The design also was modified to more clearly promote the allure of Las Vegas, and a 10-ounce size was introduced for easier placement in bars as a drink mixer. Larsen says consumer loyalty offers the biggest challenge to overcome during a national rollout.

"Consumers today are offered a plethora of options, and we need to maintain a clear image in their mind and (win) their loyalty to succeed."