Coca-Cola Freestyle: Custom Soda Fountain

Coca-Cola is testing a new custom soda kiosk in Georgia, Utah, and Southern California that allows a customer to choose from 100 potential flavors, a 10X increase over current fountains. The Coca-Cola Freestyle allows the customer to select a base flavor like “Sprite” and have it infused with other flavors (grape, strawberry, etc), nutrients, or other additives.  It is fun to see a revival of novel shopping experiences akin to the Mold-A-Rama and X-ray shoe fitting kiosks popular in the 1950’s applied to mass customization.

This is the highest profile mass customization project to be launched in recent memory and has a number of interesting angles:

Mass Customization Technology – The Freestyle uses an inkjet style system that “micro-applies” a dose of flavoring to the carbonated water. The technology was adapted from the medical field where it is currently used to administer drugs to cancer and dialysis patients. Highly concentrated, the 46-ounce cartridges can create as much soda as the 5 gallon bags of concentrate currently used in most restaurants. 3D printing and laser cutting get all the glory, but the key to mainstream customization may lie in more sedate technologies.

Selling Data – One of Coca-Cola’s primary motives with this new kiosk is to better understand regional tastes and purchasing behavior. This is a nice example of companies using what Tim O’Reilly calls “Data Exhaust” from relatively inexpensive sensors. If pineapple infused Coke was selling briskly in Honolulu, Coca-Cola could potentially bottle small batches and send it to stores. This is an exciting development in the world of retail channel which historically focused exclusively on transactions per minute or sales per foot. Apple uses retail to make money, but also to educate their customers on other (more profitable) sales channels. Other companies will be able to leverage IT and extract similar value from point of sale transactions.

Customization Penalty - The Freestyle takes 7-10 seconds longer to dispense a beverage and can only dispense one at a time. This may create a bottle neck in quick service restaurants. Also, the time someone may take exploring the user interface could become frustrating (just think about being behind the guy who hasn’t figured out how to tilt his cup while pouring). An iPhone app that allows you to browse the selections and even pre-order would be a big help.

Long Tail Drink mixing - A Bloomberg report on the Coca-Cola Freestyle yielded an interesting insight:

During the machine’s only public test, at a Willy’s Mexicana Grill in Atlanta, Coca-Cola discovered caffeine-free Diet Coke was popular late in the day. While sales didn’t justify its placement on an eight-tap fountain, the brand was easily included on the Jet, capturing potentially lost sales, Farrell said. Beverage revenue increased 10 percent to 20 percent, according to the restaurant.

History Repeats: Coca-Cola iFountain - The Freestyle is not Coca-Cola’s first foray into mass customization. The iFountain was launched in 2001 to great fanfare. However the machines were unreliable as documented by USA Today and Vending Market Watch:

Coke documents show the iFountain is beset with technical flaws from “phantom pours” to excessive foaming, overuse of syrup and — until the problem recently was solved — possible electrical shock hazards, the report noted.

The article goes on to describe the iFountain as Coca-Cola’s biggest bust since the “New” Coke debacle two decades earlier. The $50MM program was scuttled two years later in 2003. There are no details about how much this new incarnation cost, but it seems Coca-Cola has confidence in this program and technical overhaul assigning more than 50 people to the project. Hopefully, this reincarnation will prove itself and be rolled out nationwide in short order.

Tagged as: mass customization, Printing