- Coca-Cola's innovation team partnered with its Minute Maid brand to create a kombucha drink called Cidewinder. The beverage giant touted it as kombucha but with less sugar.
- The cultured juice brand is being tested in grocery and convenience stores in Texas and California.
- The company's innovation team also partnered with Coca-Cola's Honest brand to launch Honest Kombucha in 2019. Honest is expanding its reach beyond its core tea business, Coca-Cola said, and fermented tea seemed like a logical extension. The product is being tested in 20 stores, with results expected early in 2020.
Ever since James Quincey took over in May 2017, Coca-Cola has been transforming itself into a "total beverage company" that is more than just its namesake sodas.
The Cidewinder kombucha is not the Atlanta company's first foray into the fermented tea segment. Its Honest brand, famous for its bottled organic teas, launched Honest Kombucha last year. And in 2019, Coca-Cola made a $20 million equity investment in Los Angeles-based Health-Ade Kombucha.
The soda giant is no doubt channeling the knowledge it amassed in developing and investing in these kombuchas to help it create and market Cidewinder. And as a company with hundreds of beverages in its portfolio, it also has the luxury of tapping into the expertise of one of those drinks for insight in developing the product: its billion-dollar Minute Maid juice brand.
To be sure, kombucha remains a popular and uber-competitive space that has attracted the attention of other large CPG companies. According to Markets and Markets, the global kombucha market is expected to be worth $1.8 billion this year.
PepsiCo bought KeVita, a kombucha and vinegar tonics maker, in 2016, and two years later Molson Coors acquired Clearly Kombucha for an undisclosed amount. In 2017, the venture capital arm of General Mills, led a $6.5-million investment round for Farmhouse Culture, a startup that makes fermented and probiotic foods and beverages, and Peet’s Coffee took part in a $7.5-million round of funding for Revive Kombucha.
As consumers gravitate away from sugary drinks such as soda, or consume them in smaller volumes, companies like Coca-Cola have had no choice but to restock their portfolios with teas, waters, energy drinks, sports drinks, sparkling waters and kombuchas that respond to those needs.
Under Quincey's leadership, Coca-Cola also has invested and innovated in its core soda offerings — such as the debut of its first Coke-branded energy drink, smaller cans or Coca-Cola Zero Sugar to reflect the fact that people want less of the sweetener. In addition, Coca-Cola has added vitamins and protein to some drinks and dropped products people weren't buying in order to invest in others.
In addition to its innovation internally, Coca-Cola acquired Topo Chico premium sparkling mineral water. It also teamed up with McDonald's to introduce a line of ready-to-drink McCafe Frappes in grocery stores, and purchased a minority stake in premium sports drink maker BodyArmor. Its biggest deal was the $5.1 billion purchase of Costa Coffee, a U.K brand with shops and retail products, in 2018. This positioned Coca-Cola to be a bigger player in the hot and ready-to-drink coffee markets.
Coca-Cola's push into kombucha not only latches on to a trendy drink, but helps complement the other beverage options it has in its portfolio. A wider range of product offerings enables the company to have more choices for consumers that can be enjoyed depending on what the individual is looking for — a can of Coke to indulge, an energy drink as an afternoon pick-me-up, kombucha for health benefits or Topo Chico to refresh.
In an email last year, Quincey told Food Dive that despite its recent success, Coca-Cola still has plenty of work ahead. The move into kombucha is one small step in that ongoing push to keep up with the ever-changing consumer.
"We're not a total beverage company in every country and territory today, and we absolutely can be. There's so much room for us to grow in new categories in markets around the world," he said. "The key is figuring out how to give consumers the drinks and experiences they want in convenient, affordable, culturally relevant ways. That alone is going to keep us busy for years to come."