Why Keurig's At-Home Soda Machine Was Destined To Fail

Just because you can sell expensive, high quality at-home coffee makers doesnt mean you can convince consumers to buy expensive machines for every other kind of  beverage as well. Especially when people - from young to old - are cutting back on soda consumption due to its well-publicized,  detrimental contribution to obesity and health.

All of which raises questions about the ostensibly beneficial role big data is supposed to playing in improving market research. JL

Hayley Peterson reports in Slate:

Keurig Kold makes single 8-ounce servings of soda from disposable pods of syrup. Most cans of soda contain 12 ounces of liquid. The pods are far more expensive than buying canned soda at the store: every pod is about $1.25. Meanwhile, 2-liter bottles of soda sell for under $2 in stores. The machine was 'too big, loud, inconvenient and unreliable.' (Plus) Americans are cutting back on soda consumption for health reasons. 

Keurig is axing its at-home soda machine, Keurig Kold, just nine months after its debut. The company was hoping that the $370 machine would give it a new avenue for growth beyond coffee, and invested $1 billion in its development. But it failed miserably.

Here's why:

1. The machine was too expensive. Kold debuted at $369, compared to the starting price of $79 for the cheapest SodaStream model. Beyond the initial cost, every soda from a Kold machine cost $0.99 to $1.29. By comparison, SodaStream drinks cost between $0.08 to $0.20 per serving.

2. Soda consumption has been falling in the US for decades. Keurig rolled out Kold at a time when Americans are cutting back on soda consumption for health reasons. Per capita soda consumption last year was 41.4 gallons, down from 52.4 gallons in 2004, according to data from Beverage Digest, a trade publication.

3. The machine was too big, loud, inconvenient, and unreliable, according to customer reviews.

 

As soon as the machine debuted last year, it began racking up some brutal reviews from customers. Many complained that it is massive and takes up too much space, hums as loud as a "freight train," and can take up five hours to cool after being plugged in, as opposed to the two hours it advertises. "This thing is an absolute monster," one customer wrote on Keurig's website. "I already struggle with counter space. It's huge and very deep." Since the machine takes a long time to cool down, you have to keep it plugged in all the time—and on the counter—to use it regularly.

And while the machine is cooling after starting up, "it sounds like a freight train," one customer wrote. "It was pretty annoying and we could hear it in the other rooms of our house." After cooling down, the appliance continues to hum as long as it's plugged in. "There is a constant buzzing sound when plugged in (think soda vending machine) that annoys my husband, but I don't really notice it," another customer wrote. One customer said that the machine can overheat unless you keep it 2 inches from the wall or other appliances.

Keurig Kold makes single 8-ounce servings of soda from disposable pods of syrup. Several customers complained that there is no option to increase the size of the drink. Most cans of soda contain 12 ounces of liquid. Others said that the machine doesn't always work, leading to wasted soda pods, and that the pods are far more expensive than buying canned soda at the store. Coca-Cola soda pods are being sold in packs of four for $4.99. That means every pod is about $1.25. Meanwhile, 2-liter bottles of soda sell for under $2 in grocery stores.

"While I love Keurig and the thought of making sodas at home, this machine just hasn't worked for me," one customer wrote. "I've wasted pod after pod, with only 1 out of 3 sodas coming out at a time. They do come out cold, which is great." Another customer said that he received the machine for free in exchange for an unbiased review, and he disliked the machine so much that he won't be keeping it. He wrote:

I would not buy this product. It is far from economical and there is no convenience benefit. The pods are almost as large as buying a can of soda. The machine is also too large to keep on the countertop, taking up almost as much room as my microwave. It is also loud — hums louder than the refrigerator on standby.

Keurig Green Mountain was sold to JAB Holding Co. in March in a $13.9 billion deal.