BOCA RATON, FLA. — To listen to executives from Keurig Green Mountain talk about the company’s Kold single-serve beverage dispenser, the launch is about giving consumers freshness, choice and a premium experience. But the launch is also critical to the company, because it will expand its reach into new day parts, most notably the afternoon and evening.
“The ability for consumers to discover new choices and to try new choices and to constantly have trial and repeat in a very, very different way than traditional beverage categories is what has driven the Keurig system,” said Brian Kelley, president and chief executive officer, during the company presentation at the Consumer Analyst Group of New York conference on Feb. 19. “It’s what has driven the demand for choice and it’s what has driven the popularity of Keurig. And so we can leverage the cost of building the Keurig installed base across a broader range of beverages and categories, and that’s the opportunity for us in the future.”
Mr. Kelley emphasized the market for cold beverages is five times the size of the market for hot beverages in terms of dollars.
“But perhaps the most important element of this is to understand that Keurig Kold broadens the capability from the day part of morning to a day part that can span the entire day and into the evening as we look at beverages,” he said. “And so the cold opportunity for us as a company and a set of categories is very large.”
He described Keurig Green Mountain’s development of the Kold system as “seeing problems hidden in plain sight.” Problems identified included freshness, temperature and variety.
“(Keurig Kold) delivers perfect dosing of both CO2 and beverage so that you get the taste of well-known brands as well as a perfect taste for some of the new brands we will create and that others will create exclusively for the system,” Mr. Kelley said. “Perfect dosing and one-touch simplicity is a critical element of the Keurig promise.”
In addition he noted sustainability will be a component of the system as it uses 30% less water when compared to a bottled or canned cold beverage.
The initial launch of the system will feature 30 beverage varieties across 16 brands in the fall, including many owned by the Coca-Cola Co. and Dr Pepper Snapple Group. By the spring of 2016, the number of varieties available will double, Mr. Kelley said.
In addition to partner brands, Keurig Green Mountain will be introducing cold beverage brands exclusive to the company in the hopes of recapturing the success of the hot system’s Donut Shop brand.
“Donut Shop is a brand we created, a brand we created at the launch of the (hot) system,” Mr. Kelley said. “A brand that we created that has been built quite differently. It has never spent a penny of advertising in the traditional way, but it's the No. 1 s.k.u. (stock-keeping unit) in our Keurig hot system.”
