Coca-Cola: turning free water machine into a cash stream?
As part of our Clean Living investment theme, we’ve seen case volumes of not only sugary beverages but also those laced with artificial sweeteners come under pressure as consumers shift to healthier alternatives, including a variety of waters both still and sparkling. Existing soda giants, such as Coca-Cola have been expanding their beverage offering in recent years adding a water, teas, sports drinks and even milk to their global line up, but those still come in a can or plastic bottle.
Looking to more fully embrace the shift to Clean Living and potentially shun plastic bottle, Coke is sampling what it is calling Dasani Free that lets a consumer use their own reusable water bottle for free water or pay for added bubbles and flavors, but NO sweeteners or other ingredients are available. That sure does sound like Coke looking to pivot from its legacy business but it’s not as extreme as the move made by Cott Corp. when it sold its entire soda business.
This is a twist on its Coke Free-Style Machine, but it marks a huge shift in mentality for the company. Perhaps one day we may wind up calling reusable water bottles something like reusable beverage bottles… it could happen, look how the war on straws is forcing change, and yet all those plastic cold cups at Starbucks still remain…just saying.
The world’s largest soda maker is testing a fountain that lets people fill reusable water bottles with free, filtered water — but also offers the option of paying to add bubbles and fruity flavors. It’s an example of how the maker of Fanta, Sprite and Powerade is searching for new ways to make money as Americans cut back on traditional sodas.
For now, Coca-Cola is testing just one “Dasani Purefill” machine on the campus of Georgia Tech, across the street from its headquarters in Atlanta. It says it plans to expand the test on a rolling basis this fall to 20 machines on campuses in 15 states, though it did not specify locations.
The concept: You can have filtered water for free, or swipe a credit card to add bubbles or flavor for 5 cents an ounce, plus a 15-cent transaction fee. So filling a 20-ounce bottle with bubbles and flavor would cost $1.15.
You can’t get sweeteners and other ingredients.
The idea hitches a trend that has no sales potential for Coke (reusable water bottles) to one that does (sparkling, flavored water such as La Croix). If it catches on, it would help Coca-Cola squeeze money out of an increasingly popular habit that could otherwise hurt its business.
Source: Coke hopes to turn free water machine into a cash stream
