While Coca-Cola is making multi-billion dollar bets with Keurig Green Mountain and Monster Beverage (NASDAQ:MNST), PepsiCo is taking the more conservative approach. Unfortunately, there are two issues with the system, the first being that the rollout of the system will take much longer than originally thought, with a very limited launch for this holiday period.
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With the sales of carbonated drinks dropping in the USA in the last ten years, Coca-Cola has supported Keurig’s new home fountain.
“It’s a premium – it’s about choice and convenience”, Keurig CEO Brian Kelley stated.
The machine makes a single serving of cold beverages including Coke, Spirit, Dr. Pepper and flavored seltzers.
While an attention grabbing idea, there are still a few qualities about the Kold, mainly related to the price, that is a cause for concern, reported the New York Times.
The Keurig Kold is available to order on the company website, and will be sold at select retailers and online in six cities including Atlanta, Boston, Chicago, Dallas, Los Angeles and New York, starting later in October.
Perfectly portioned. Keurig® KOLD™ delivers beverages at an eight-ounce portion size, and almost all beverages have 100 calories or less. (GMCR) is betting that you’ll want to make your favorite cold sodas at home after the resounding success of its single-cup hot coffee and tea brewing systems. For carbonated beverages, the system uses Karbonator beads, which are contained within the pod and hold beverage-grade CO2. Moreover, thanks to the “aerospace-inspired thermal transfer system”, each one of Keurig Kold’s crafts will come out chilled, so you don’t have to worry about keeping ice on hand or throwing your drink into the freezer at first blush. Until the Kold platform becomes a lot more price realistic for consumers and the future of the soda business becomes clearer, I don’t see Coca-Cola shares outperforming their key rival. Still, the company’s coffeemakers are already ubiquitous in workplaces around the country, so it’s not hard to imagine Keurig will push the new Kold heavily in the enterprise market.
From the Dr Pepper Snapple Group: Dr Pepper®, Canada Dry®.
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From The Coca-Cola Company: Coca-Cola®, Diet Coke®, Coke Zero®, Sprite®, Fanta®. That doesn’t include the soda flavoring. Goldman Sachs reaffirmed a “buy” rating and set a $120.00 target price (down previously from $133.00) on shares of Keurig Green Mountain in a research note on Monday, July 27th. Meanwhile, The KOLD pods are available at a price range of $4.49 to $4.99 for a four-count box, along with additional drinkmaker accessories.
