Will consumers spend $370 for a Coke?
Keurig has helped change the way millions of consumers drink coffee with its single drink system. Having succeeded at hot beverages, it has long been rumored that the company would create a new machine to do the same for cold drinks. Now, the long awaited Keurig Kold machine is finally here, but at a price tag that may result in sticker shock for many.
The new Kold machine has a suggested everyday retail price of $369. The ingredient pods (AKA K-cups) needed to make an eight-ounce glass of soft drink such as Coke will cost $1 each. The new system will also make Dr. Pepper and Canada Dry beverages along with a list of private label drinks.
Coca-Cola, which has a 16 percent stake in Keurig, is counting on the new system, which is said to produce a beverage similar to a fountain drink, as a means to grow sales of its broad brand portfolio.
How many will be willing to drop $370 for their first eight-ounce glass of soda remains an open question — warm two-liter bottles and 20-oz. cold drinks sell for under $2 in retail stores. Analysts believe price will become less of an issue over time as retailers inevitably discount to turn inventory and Keurig lowers the price as it ramps up production to meet increased demand.
Brian Kelley, president and CEO of Keurig, doesn’t believe price will be an issue for the new machine and fully expects Keurig Kold to change the way consumers get their cold beverages.
"There are a lot of things consumers will pay $299 dollars for and we think this is one of them," Mr. Kelley told The Boston Globe. "We’ve literally brought a bottling plant into your home in a size that fits on your counter."
- Keurig Green Mountain Announces The Launch of Keurig KOLD – Keurig Green Mountain, Inc.
- Will the U.S. warm up to Keurig Kold – The Boston Globe (tiered sub.)
Do you expect Keurig Kold be a hit or miss with American consumers? How might the addition of Keurig Kold affect the way food, drug, mass and other channels manage their cold beverage businesses?