LION, DAWG AGAINST BULL NEW ENERGY DRINKS DUKE IT ON BASIS OF TASTE, PRICE.

Byline: Evan Pondel Staff Writer

BURBANK - When Sean Hackney left a senior marketing position at Red Bull Inc. several years ago, his energy level was at an all-time low.

The Herculean businessman had grown weary after the job he thought would bring gratification and monetary wealth ended up causing a bout of disillusionment. Hackney said cultural differences instigated his eventual departure, an experience he still laughs about, sullenly. But in many ways, Hackney's embitterment fueled an entrepreneurial spirit best exemplified by the myriad energy drinks on the market.

The sheer dominance of Red Bull is driving a growing number of beverage enthusiasts to concoct drinks that deliver the same punch at a better price.

To do that, Hackney and a few other former Red Bull executives developed a slightly different animal called Roaring Lion. The energy elixir tastes like Red Bull and even looks like Red Bull. Yet, Roaring Lion costs almost 60 percent less, a characteristic that industry analysts say is the drink's most potent quality.

``Business establishments are paying an arm and a leg to sell a product that is exactly the same from a taster's perspective,'' said John McKenna, research director at Cambridge, Mass.-based BevNet. ``And now here comes Roaring Lion, a company that is trying to offer bars and restaurants better value.''

Greater value doesn't always come without complications. Red Bull recently reached a settlement with a San Diego-based nightclub that was allegedly ``passing off'' Roaring Lion for Red Bull. Though Lion executives were not held culpable, the Burbank-based company is now extra vigilant about telling bars to inform customers that a ``Red Bull vodka'' may actually be a Roaring Lion vodka.

Red Bull continues to challenge those bars selling similar tasting competitors. The company has settled four passing-off cases in the U.S., with one court ordering a permanent injunction to prohibit ``establishments from passing off any non-Red Bull drink as Red Bull,'' Patrice Radden, spokeswoman for Red Bull, said in an e-mail. ``The settlements confirmed that the substitution of an alternative beverage for Red Bull without notifying the customers ... violated Red Bull's rights and, more importantly, deceived the consumer.''

Deception aside, it is difficult to contest the price difference between Roaring Lion and Red Bull. Suggested wholesale for three gallons of Roaring Lion is about $150 versus 277 cans of Red Bull which could cost close to $370, according to Roaring Lion executives. The presentation of Roaring Lion also differs from Red Bull as the drink is served at the fountain via a bag in a box. Red Bull is always served in a can, a trait that has been both a positive and negative for the company.

``Among the largest issues for bars is that Red Bull tends to disappear with the staff. They drink a lot of it. It helps them work faster. But the bar ends up losing,'' McKenna said.

Among other Red Bull differences, bars use only a quarter to half of each can per serving. Considering consumers usually like to see a fresh can cracked for every vodka they order, McKenna said the bar usually wastes a lot of Red Bull.

Even though Roaring Lion's executives are former Red Bull employees, the company is still far from its rival's mammoth size. In 2003, 1.5 billion cans of Red Bull were consumed worldwide, an increase of 17 percent compared with 2002. At the same time, revenue grew by 10 percent to $1.5 billion in 2003, versus revenue a year ago.

Analysts expect another strong year for energy drinks, with domestic sales expected to reach almost $1 billion, a 25 percent increase compared with 2003.

Roaring Lion would not disclose its annual sales, although the company's marketing team recently landed several deals in the Midwest. Key to their success is a taste test much like the way competing soft drinks are often compared. The company almost always asks a potential client to close his eyes and try to detect the difference between Red Bull and Roaring Lion.

``And by doing that, we're trying to teach the club culture that there is a much better way than Red Bull,'' Hackney said.

BevNet, an online soft drink publication known for its reviews, said the following about Roaring Lion: The drink has ``clearly established itself as a me-too product. This leaves only price and packaging as the points of differentiation.''

Roaring Lion received a star-and-a-half BevNet rating out of a possible five stars. The company now sells individual 16.9 ounce bottles of Roaring Lion, and while the bottle's simple design looks ''very no-frills ... it certainly would not compel us to purchase the product, unless it carried an extremely discounted price,''BevNet said.

The pep one derives when sipping a can of Red Bull or a bottle of Roaring Lion usually outweighs the products' actual taste. That's why other companies are attempting to harness the same caffeine high with a more delectable deliverance.

Raw Dawg, a berry-flavored energy drink, is Calvin Ross' latest creation. His Burbank-based company serves the drink in a 16-ounce can that retails between $1.99 and $2.69. An Italian Mastiff clenching a dumbbell is depicted on the can's label with the phrase ``Horny Goat Weed Enhanced'' positioned just above the dog's ears.

''We are not trying to be another Red Bull,'' said Ross, standing beside a souped up H2 wrapped in Raw Dawg decals. ``And we want Raw Dawg to represent many different people in this world, from Bill Gates to the soldiers in Iraq. They're all Raw Dawgs.''

Since the company's inception only eight months ago, Ross has already been able to cut deals with major chains, including Wal-Mart in Puerto Rico. Raw Dawg posters adorned with Spanish phrases are stacked up throughout the company's Burbank warehouse. Ross said the company is keen on targeting the Latino and hip-hop communities.

``We're also in talks with some major distributors, but I'm not ready to disclose their names,'' he said.

Other energy drinks including Nelly's Pimp Juice and Lil' Jon's Crunk have already surfaced as hip-hop's call to quenching thirst. While these drinks possess fad-appeal that will likely fade, McKenna said they are all more palatable than alternatives.

Raw Dawg's taste helped the drink receive a 4 1/2 star BevNet rating out of five. ``And this product is one of the few 16-ounce energy drinks that our panel would be able to consume the entire can of,'' BevNet said. ``The only thing that was a little questionable was the amount of coloring - it's a bit intense.''

Evan Pondel, [phone]

evan.pondel(at)dailynews.com

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2 photos

Photo:

(1 -- color) Calvin Ross, chief executive officer of Raw Dawg, an energy drink company, shows off his wares.

Hans Gutknecht/Staff Photographer

(2 -- color) Roaring Lion owners, from left, Ed Hackney, Kevin Wright and Sean Hackney are trying to outperform rival Red Bull in the energy drink market. The product's lower price is an advantage.

Gus Ruelas/Staff Photographer