Peace Tea eyes a future with Coca-Cola

The newest tea from Hansen Natural Corp. has a '60s-themed image some might describe as "groovy".

California-based Hansen is in discussions with Coca-Cola Co. of Atlanta and some of its main bottlers, hoping to get Peace Tea into the Coke distribution system in a matter of weeks.

The ready-to-drink tea category already includes market leader AriZona as well as drinks from Snapple, Coca-Cola and Pepsi. As the North American beverage business struggles through a recession, ready-to-drink teas have posted modest 1.8 percent sales growth this year, Beverage Digest reported in November.

Hansen is best known for its Monster energy drinks, which outpace competitors Red Bull and Rockstar in terms of liquid sold in the U.S. But Peace Tea is a bit of a throwback for the company, which built its reputation on juices and sodas. It is introducing Peace Tea in four flavors: green, imported Ceylon, sweet lemon and razzleberry.

"Peace Tea is whatever you want it to be," says the brand's official Web site, which is festooned with peace signs. Peace Tea "stands for social obligation, social awareness, benevolence, compassion and soul. It can, in the form of a mere liquid, be your own form of poetry, art, music, philosophy, belief system."

That's quite a promise for a tea -- especially one priced at 99 cents, as reports suggest. But the companies involved have high hopes for the drink, which is expected to eventually reach the broader Coca-Cola distribution system. Thanks to the backing of that system, Peace Tea could gain "meaningful distribution" in the U.S., according to Stifel Nicolaus analyst Mark Swartzberg.

Swartzberg predicted that Peace Tea will not get big marketing bucks for its launch. But it is getting buzz at the top levels of Atlanta-based Coca-Cola Enterprises, one of the world's biggest beverage distributors.

John Brock, the bottler’s chairman and chief executive, mentioned the tea in conference calls and meetings with Wall Street analysts. It is part of the bottler's “strong plans” for non-carbonated drinks, he said in December.