For several years, decades even, Coca-Cola has faced a problem that might be familiar to executives at Google or Microsoft. They've been too dependent on one product for the source of their revenues, that product being Coke. In their attempt to expand their product base, the company has tried offering several permutations of their famous. The most infamous of these was New Coke (AKA Coke II); the most recent is the coffee-infused Coca-Cola Blak (which is actually pretty good, though supposedly most people hate it). There have been several in between, none of which went very far.
But now Coca-Cola is embarking on a new strategy that might be more interesting. The company is partnering with restaurants to co-develop unique coke-based products, only available in those restaurants. It's not just drinks; in the past chefs have been to known to incorporate the drink into various savory sauces as well. Looking down the road, one could see Coke as basically a platform that would allow anyone to develop their own coke-based products, perhaps by entering ingredients and directions into a website, and receiving a shipment of said product. Instead of trying to guess what new mass-marketed permutation of Coke will be a hit, letting bars, restaurants and stores develop their own variations (complete with uniquely designed bottles of course), would reduce the risks of a blockbuster flop and save money on marketing costs. While every internet company wants to be a platform for creating mash-ups, it seems these ideas can be extended to the physical world as well.
It looks like Coke is chasing the recent success of Hansen Natural and Jones Soda. These upstarts have built explosive-growth, successful companies by filling a flavor AND marketing void that Coke and Pepsi could not (would not?) go after.
The fun part will be to watch this enormous, slow-reacting conservative company try once again to drive innovation through its bureaucracy. Coke might find the ultimate flavor through this new process, but it would be ages before this dinosaur would get it to the masses. The other issue is that Coke would have to find mass-appeal flavors to match up with its mass-appeal marketing capabilities.
Interesting strategy that might work for a more nimble company. I'm skeptical that stodgy, slow-moving Coke can make it happen.
Posted by: El Queso Grande | May 31, 2006 at 08:39 AM