QSR Insights: Coke’s Futuristic Soda Fountain Boosts Sales for QSRs
Coca-Cola is addressing key consumer needs head on through innovation of the soda fountain.
Three years ago Coca-Cola introduced the futuristic soda fountain, Freestyle. The fountain was only placed in selected markets for testing but, sales and foot traffic soon increased with the buzz of the futuristic machine. According to a recent article in Ad Age, Coca-Cola will expand Freestyle’s markets to 80 by the end of this year and will introduce the first marketing campaign for the machine.The Freestyle allows consumers to mix 125 different flavors of soft drinks, flavored waters, sports drinks and lemonades. Not only is the fountain able to combine multiple flavor options, but it is also able to collect data that executives at Coca-Cola headquarters look at closely. They have already started to evaluate the data from the more than 1,500 machines in restaurants such as Wendy’s, Burger King, Taco Mac and Five Guys.One data insight collected so far has been the popularity of Caffeine-Free Diet Coke after 3:00 in the afternoon, which could lead Coca-Cola to suggest adding the Caffeine-Free Diet Coke brand to traditional soda fountains when restaurants have high traffic in the afternoon.As part of Coca-Cola’s initial testing phase, Firehouse Subs saw their sales and traffic double with the addition of the Freestyle. In addition to traffic, they also saw an increase in people eating in the restaurant, families with kids coming in, and orders including a drink with a sandwich, rather than just a sandwich. Firehouse Subs will be adding the machine to all of its 437 locations by the end of the year.
Along with the market expansion, Coca-Cola is working with Ogilvy & Mather to create the first marketing campaign for the Freestyle. Radio, outdoor and digital will most likely be the start of any measured media. According to Consumer Edge Research, more than 20% of consumers agreed they would switch restaurants if the Freestyle was offered at another place. Teens and parts of the multicultural population have shown an extremely high interest in the machine.
In addition to the 2012 marketing campaign, a new Facebook app and mobile app are in the works. This app will allow consumers to mix up and share their favorite Freestyle combinations. These recipes would then be converted to 2-D barcodes that could be scanned at any Freestyle machine to produce the mix. Coca-Cola is planning to retrofit a limited number of machines with barcode scanners in the first quarter of 2012 to test the app.
Taking into account the things Barkley has learned from “American Millennials: Deciphering the Engima Generation,” our recent study in partnership with with SMG and The Boston Consulting Group, as well as our experience in the restaurant category, it’s my opinion that this is a brilliant innovation by Coca-Cola. Millennials seek adventure and customization, which Freestyle delivers while empowering the consumer to be creative.
Photo credit: Rondo Estrello
Cross-posted from Off the Shelf