ATLANTA, GA -- Soft drink manufacturer Coca-Cola Co. is making plans to step out of the cooler by venturing into the hot dispensed beverage category, reports the Atlanta Business Chronicle.
“For the past two years, Coca-Cola has been quietly investigating ways to brew high-quality coffee, espresso and teas quickly in individual servings,” writes the newspaper. In 2005, the company filed five U.S. patent applications for coffee and tea single-serve machines and a system compatible to make hot espresso and cappuccino. The company has so far been awarded two patents.
Furthermore, in late 2005 Coca-Cola filed nine applications to trademark the name “Far Coast” as a brand of coffee, tea and other products. Mary E. Minnick, president of worldwide marketing, commented in a December 2005 analysts’ conference in New York that Coca-Cola would be investing in a brand of coffee called Far Coast sometime in 2006, writes the newspaper.
“To deliver a good cup of coffee, you need a barista [an expert coffee-maker] and a lot of average kiosks and cafes can't afford those, so we've developed a cost-efficient technology that dispenses a perfect cup of coffee, perfect latte, perfect tea, every time,” Minnick told analysts, adding that potential customers would be restaurants, cafes and kiosks.
The Far Coast venture would not be the first stab at a proprietary coffee brand for Coca-Cola. In 2001, the company joined the ready-to-drink coffee market with Planet Java, which came five years after PepsiCo and Starbucks teamed to bring consumers the Frappuccino brand. Planet Java has since “flopped,” notes the newspaper, while the Frappuccino and DoubleShot coffee beverages continue to grow.
“There is no doubt they are looking really hard at this space,” Michael Coles, CEO of Caribou Coffee Co., told the newspaper. “I would think for Coca-Cola, who is already providing machines for offices, to be able to provide coffee would give them an edge over their competitors.”
The Atlanta Business Chronicle also writes that 2006 could be a “breakout year” for Coca-Cola as it prepares to launch new beverages such as Coca-Cola Blak, a coffee-flavored soft drink, as well as a new partnership with Godiva to launch a ready-to-drink “indulgent" coffee beverage due to hit store shelves this spring. Plans are also underway to launch a tea drink called Gold Peak.
U.S. coffee consumption is a growing market, according to the National Coffee Association. In 2005, daily U.S. coffee consumption increased to 53 percent of adults, up from 49 percent in 2004.
“I'd say it's a very healthy industry,” Joe DeRupo, spokesman for the National Coffee Association, told the newspaper.
According to the 2005 NACS State of the Industry report, convenience stores sold more than $5.2 billion in coffee in 2004 ($4.0 billion in coffee sales, plus $1.2 billion in cappuccino/specialty coffee sales.) Retailers also averaged coffee sales of $37,274 per store.
Click here to view the NACS fact sheet, "Coffee Sales in Convenience Stores.”