The drink drops business is getting a new participant, or should we say a giant. Hoping to piggyback on the success of Kraft´s MIO drops Coke believes there is a lot of opportunity for this type of product.
"I think there's an opportunity beyond just flavored waters," said John Roddy, vice president of Coca-Cola's water, tea and coffee business in North America.
Since Kraft´s MIO launch last year there have been numerous copycat products hoping to capitalize on this new market. The drops are popular because you can carry the bottle with you anywhere you can and choose how much or little you decide to use. The economic factor is important as well since consumers can save on paying for bottled water or flavored waters. Both Kraft and Dasani´s drops are made with artificial flavors and zero calories.
There are no set plans or dates as to when Coca Cola will enter this market but we are sure their product development team is hard at work.
Analysis & Impact
With Coca Cola´s massive distribution network they can easily bring this new product to market. In reality the drops are a modern version of Kook Aid in liquid form with better health benefits. The beverage giant will use Dasani water and distribute wherever Dasani is sold. The idea is that the new drops will also boost the consumption of Dasani water as well. Other units of their business will be hurt in the process but the new market will introduce additional profits.
Soda products are under attack worldwide because of their high sugar content and links to obesity. It will become harder and harder to successfully sell regular soda products so beverage manufacturers like Coca Cola have to begin diversifying their product lines to make up for lost sales. As consumers become more aware of the poor health benefits of soda sales will continue to drop.
Kraft may be enjoying initial success because of the uniqueness of the product and by being first to market. With added competition and the novelty wearing off only time will tell how popular these drink drops really are. In our opinion this is a product for home consumption, I have yet to see anyone dropping flavored drops into water in a public setting. MIO has diversified its line with new flavors and an energy product. The segment is new and there is a lot of room for innovation. Because of Coca Cola´s huge reach we would expect them to make an immediate impact in the industry as soon as they launch.