If you thought cable TV offered too many choices when it started displacing the big three broadcast networks, the newest Coca-Cola Freestyle soda machines probably aren’t for you.
The Freestyle machine is billed as the “Fountain of the Future,” a touch-screen, Wi-Fi-enabled, tracking-chip-equipped, soda-dispensing gizmo designed by automaker Ferrari. It uses medication-dosing technology to create some 125 Coca-Cola products, many of which, like Orange Coke and Vanilla Sprite Zero, aren’t available in bottles anywhere.
The machines are just starting to hit Charlotte. Moe’s Southwest Grill will be debuting a Freestyle machine for customers at the EpiCentre complex in uptown. And Taco Mac has been using them for several weeks at its SouthPark and University City locations.
“This is a really big innovation in the fountain business,” said John Sicher, publisher of the trade publication Beverage Digest. “No one has anything comparable.”
Soda fountains in restaurants represent about a quarter of the $74 billion U.S. soft drink market, Sicher said. Coca-Cola controls about 70 percent of the soda fountain business, but faces increased competition from convenience stores and other outlets that offer huge drink selections.
“Restaurant customers like McDonald’s are interested in being more of a beverage destination and competing better with convenience stores,” Sicher said. The Freestyle machine lets them compete without installing a wall of coolers.
Besides giving consumers a dizzying array of drink options, the machines provide restaurateurs and Coca-Cola with an unprecedented level of information. They offer statistics on exactly which drinks are being ordered – and how much, and when. The machines display that information to business owners and transmit it to Coca-Cola headquarters in Atlanta every day.
Coca-Cola marketing manager Dan Redler said the company could use that information to develop new products, based on the machine’s most popular drinks.
“Our brand team will be watching,” Redler said.
Taco Mac vice president of marketing Bruce Skala said the new figures allow him to track what he’s selling much more closely, and fine-tune offerings for certain times. For example, Skala said he might notice which drinks sell best on nights when wings also sell strongly – a good menu pairing to push to customers.
“Data is king,” Skala said. “I even know how much water I’m selling now.”
The machines have been in development for five years, Redler said. They’re now available in some 54 markets, and are slowly rolling out to others as Coca-Cola trains maintenance personnel to service them. The machines are manufactured by Coca-Cola at the company’s Atlanta facilities and leased to restaurants. There are about 800 of the machines in operation now, a fraction of the total number of soda fountains.
Competitors are upgrading, too: PepsiCo recently debuted a “social” vending machine, a touch-screen-equipped machine that lets users connect with each other via cellphone while purchasing soda. If you know a friend’s cellphone number, you can buy him a Pepsi – in the form of a redeemable coupon sent to his phone.
A standard soda fountain, the kind that you use to fill up the familiar plastic drink cup at a fast-food restaurant, uses some eight cardboard boxes holding flavor syrup-filled plastic bags. Six to eight varieties are about all you get, and the setup takes up about as much room as a refrigerator in the restaurant’s back area.
If the humble soda fountain were the Wright Brothers’ plane, the Freestyle machine would be an F-16 fighter jet. Instead of the five-gallon bags of flavor syrup, the machine contains small plastic cartridges filled with super-concentrated flavoring “essence” – no water involved.
When a consumer or waiter uses the touch screen to select a combination – say, Vanilla Diet Caffeine Free Coke – the machine pulls ingredients from the cartridges and combines them, dispensing a single serving into the cup.
Radio-frequency ID chips in each cartridge measure exactly how much of each ingredient is left and alert Skala to order more. The machine runs self-diagnostic tests and schedules service visits for any issues at off-peak times, without even needing to let the restaurant know.
The campaign to promote Freestyle is largely social-media-based. Some 32,000 people “like” the machine’s Facebook page, and restaurants that are rolling out the machine are promoting it on their own Facebook pages and Twitter feeds. A smartphone app uses GPS technology to tell people who are dying for a fix where the nearest Freestyle machine is.
What all of that high technology comes down to is a potentially healthier bottom line, both for Coca-Cola and restaurants that use the new machines.
Said Skala: “We’re selling a lot more soft drinks.”