We understand that business to consumer brands can produce vastly different results in and within every region of the globe, and what better example than the beverage industry. Separated into various subgroups, the global carbonated market is projected to generate approximately $412.5 billion USD by 2023. Soft drink brands such as Coca Cola and Pepsi hold the largest market share but are increasingly under threat from a new generation of smart consumers. Millennials and Gen Z, as well as older consumers, are increasingly exposed to the dangers of sugar consumption and the environmental impacts surrounding this industry. But in every challenge... lies opportunity.
How does the beverage industry keep up, remain relevant and adapt to changing consumer behaviors? With consumer insights! In our ever-growing digital landscape, the most innovative companies build a well-rounded picture of their consumers through an infrastructure that allows them to be heard. The days of traditional market research aren’t over, they’ve just been enhanced with the power of real-time data insights.
In this post, we'll use the world’s largest carbonated drinks company Coca Cola, as an example. Pay attention to the different ways they use campaigns as a way to collect consumer insights and identify emerging trends.
How Coca Cola collects consumer insights with creative campaigns
Coca Cola markets and sells its products in over 200 countries, but despite developing a global and universal image in 127 years, the brand like any other, needs to address different regional preferences such as flavor, calorie count, sugar content, consumer behavior and of course competition.
Using AI-powered soda dispensers to understand evolving consumer preferences
One of their innovative responses to these challenges has been the reinvention of the fountain beverage machine. Originally created in 2009 as a functional drinks dispenser, Coca Cola has recently unveiled the newest Coca Cola Freestyle 9100. It includes optical and motion sensors, Bluetooth technology, real-time cloud connectivity and most importantly, artificial intelligence.
John McCarthy, an earlier pioneer in the field of AI, defined artificial intelligence as “the science of making machines that can perform tasks that are characteristic of human intelligence.” This might include understanding language, translating content between languages, recognizing elements in images and speech, or making decisions. This means vending machine data can be processed in real-time to analyze purchasing decisions.
“Artificial intelligence is the foundation for everything we do. We create intelligent experiences. Artificial intelligence is the kernel that powers that experience.” Coca Cola Global director, Greg Chambers.
Using the data collected to improve product and user experience
Each individual machine conducts real-time analysis of consumer data, responding in various helpful ways to improve customer experience. The AI algorithm means every establishment can use their machine to promote unique, bespoke beverages and trending flavors in relation to their consumers.
AI also allows these machines to adjust to the “mood” of their environment. In gyms for example, the display screen will focus on performance-based sodas, the promotion of water and healthier beverages. Machines in shopping malls will display lively, colorful, trending sodas, and hospital machines will appear more functional. Globally, Coca Cola has installed over 50,000 machines, serving over 14 million, 8-ounce servings of drink per day, creating a gargantuan amount of actionable data.
Launching new products and flavors based on AI collected data
In 2017, consumer data from the Freestyle machines displayed considerable consumption levels of Sprite and Cherry flavors. As a result, Coca Cola released Sprite Cherry and Sprite Cherry Zero products in stores. It was the first permanent product to come out of the Freestyle machine data.
Coca Cola believes the element of choice and customization are here to stay, contrary to the one-time fad belief. In February 2019 they released a new melange of classics in the form of Orange Vanilla Coke and Orange Vanilla Coke Zero. This was the first new Coca Cola product to be innovated in almost a decade and is also suspected to be a creation of AI.
In light of growing awareness on health and wellness, and increasing sales of diet beverages, the Freestyle 9100 was also adapted to include 117 low calorie/ no-calorie options and 130 no-caffeine options. Before the Freestyle machines were used, Coca Cola offered a caffeine-free diet coke in less than 1% of dispensers in the US. After being installed data showed caffeine-free diet coke was in fact in their top five dispensed drinks during the afternoon.
Coca-Cola Zero Sugar. Great Coke Taste. Zero Sugar. Zero Calories. Yup...we've nailed it. And the compliments keep pouring in. pic.twitter.com/f9Za7JHJvH— Coca-Cola Canada (@cocacola_ca) March 15, 2019
What's more, the new dispenser also invites customers to download a 'pre-order app' allowing them to create drink mixes prior to collecting orders. The strategy appeals to Gen Z and Millennials in response to the rising use of smartphones and tech-savvy consumers. The app is suspected to produce more accurate decision making data since customers have more time to make their choices.
A marketing campaign to identify trends: #MakeYourMixContest
The latest marketing campaign to be produced in line with the new Freestyle 9100 was the first-ever “Make Your Mix” contest. The contest invited fans and consumers to create a winning custom combination for a grand total of $10,000.
Fans were limited to two or three mixing choices and were required to share their creations on social platforms Twitter or Instagram with the hashtag #MakeYourMixContest. The winning combinations will be served to customers for a limited period in September 2019.
This type of marketing campaign helped Coca Cola increase their brand visibility and share of voice online. The aim was to incentive a broad audience of consumers instead of targeting specific tribes.
“We’re empowering and potentially rewarding our fans for something they’re already doing – making Coca-Cola Freestyle beverages that are 100% their own,” says Sarah Greenberg Sachs, marketing director.
The key to success: Continual innovation
Coca Cola remains the world's largest beverage company through continual innovation such as their latest adoption of AI. They understand that each local market holds specific consumer preferences in terms of flavor, sugar content, calorie count and consumption and adapted to this challenge using a reverse sales strategy.
Going against linear methods of collecting consumer data, Coca Cola optimized their product and sales processes. The dispensing machines have become real-time sources of market research, allowing them to identify opportunity and weakness before taking to the shelves. As consumer preferences evolve, winning brands will continually innovate to stay one step ahead.
At Linkfluence, we know how important it is to combine AI with human expertise. Watch our webinar with Forrester to unlock valuable and actionable market insights that will help serve your customers.