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Price, size, and consumer audience led to failure of Keurig Kold, Euromonitor analyst says

Mary Ellen Shoup

By Mary Ellen Shoup+

10-Jun-2016
Last updated on 10-Jun-2016 at 15:24 GMT2016-06-10T15:24:08Z

The reception of Keurig Kold fell flat with consumers who didn't want to make soda at home.
The reception of Keurig Kold fell flat with consumers who didn't want to make soda at home.

Keurig Green Mountain has discontinued Keurig Kold, an in-home soft drinks machine because it “failed to deliver on consumer expectations,” the company said.

Keurig Kold originally launched in October 2015 and was available for less than a year. Keurig said it will offer full refunds to Kold customers.

As a result, Keurig will cut 108 jobs at its Vermont factory where the machine was manufactured.

Howard Telford, senior beverages analyst at Euromonitor International told BeverageDaily that were several reasons why Keurig Kold never took off with consumers, the biggest pain points being price and a shrinking market size for carbonated soft drinks.

Price is not right

One of the first setbacks for Keurig Kold when it launched was its steep price tag of $365 to $370, a heavy price to pay to not delivering on value, Telford said.

Many Kold customers also complained about the machine’s bulky size and the long wait time to prepare a carbonated eight ounce beverage.

“The original retail RSP for the machine was $365, which is at the very high end of mass market beverage appliances,” Telford said.  

Major beverage companies like Coca-Cola offered its own Kold pods, but the price per pod was too high for soda drinkers to make the switch from packaged carbonated soft drinks to an at-home system.

“In addition, the unit price for a pod was between $0.99 and $1.29 for an eight ounce serving size. This compares poorly with a similar or lower price point for a 12 or 20 ounce serving of the same brands in packaged retail or foodservice.”

Consumers want bubbles without the sugar

Keurig was trying to create a market place for single-serve soda at an inopportune time when consumers were increasingly turning away from sugary soft drinks and seeking healthier beverage options to consume at home, Telford said.

Competitors like Sodastream were able to avoid this market pitfall by offering consumers a way to make at-home sparkling and seltzer water in addition to soda.

“The Keurig Kold faced an uphill challenge in converting consumers that are trying to cut sugar from their diets and seek natural beverage alternatives instead,” Telford said.

Future of at-home beverage appliances

Telford believes that the technology and R&D involved in at-home carbonated beverages could be valuable for larger companies like Coca-Cola, but not necessarily in the single-serve format.

 “At the end of the day, this was an ambitious experiment that proved to be too expensive without sufficient market demand for the end product,” he added.

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