Coca-Cola to expand testing of new drink fountain

Tue Sep 29, 2009 4:44pm EDT

Related Topics

* Coca-Cola developing new "Freestyle" soda fountain

* Aims to grow sales by offering wider choice to consumers

By Matthew Bigg

ATLANTA, Sept 29 (Reuters) - Coca-Cola Co (CCE.N) is to expand testing of a new "Freestyle" soft drink fountain it hopes will boost sales by allowing consumers to choose among more than 100 of its drinks, company officials said on Tuesday.

The fountain uses touch-screen technology and smaller quantities of concentrate in cartridges rather than in 5-gallon boxes to expand the range of drinks on sale. Traditional soda fountains allow customers to choose from about eight drinks.

"It (the new fountain) broadens the exposure for our brands and gives us a chance to drive significant growth to our customers," said Chandra Stephens-Albright, group director for marketing and business development.

The company will expand testing of the beta-phase product in Atlanta, where there are currently 37 fountains including at some AMC cinemas and Burger King BKC.N restaurants, as well as in San Diego and Orange Counties in southern California.

Coca-Cola began design of the Freestyle in part in response to a perceived problem: 30 percent of people at restaurants do not buy a beverage at all, in part because they cannot get the drink that they want.

"We were capturing a smaller share of consumption because we did not offer choices and at the same time the portfolio was growing dramatically as we created new beverages," said Gene Farrell, vice president of the Jet Innovation Program at Coca-Cola North America.

Soda fountains account for about 30 percent of total Coke product sales in North America, officials said. They declined to put a dollar figure on the sales.

Some 45 percent of the outlets that have soda fountain agreements with the company could support the Freestyle but those outlets represent about 85 percent of sales in that area, Farrell said.

Sales have risen as much as 20 percent in some outlets where the new fountain is being tested, though officials said it was too early to draw firm conclusions on how the fountain could affect sales in the long term. (Editing by Jane Sutton, Gary Hill)

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