Have your favorite morning beverage handy? Is it coffee? Maybe a soda? Why not both in the same cup? Right, the idea sounds nutty, like pouring off liquid from the bottom of a breakfast spot's bus bin and serving it up. But that's pretty much what Coca-Cola is planning, according to news from yesterday from CNBC. A mix of Coke and coffee.
No, that's not a joke.
Apparently, Coca-Cola CEO James Quincey told analysts in a call Tuesday of the plans. The idea is not to juice up the caffeine content of the drink, but to land somewhere between the two. The drink won't be offered in the U.S., according to reports--at least not yet.
Crazy, right? What it brings to these shores is a question that can never be asked enough in business: How far can you stretch brands? You might think it was that far, but depending on your markets, it might be much further than expected.
Coke isn't new to the idea of going too far. The "New Coke" disaster of the mid-1980s is still a classic case study. The company changed the taste of its main product. People revolted.
We're no longer in the 80s, though. Since then, the company has learned a lot. One is to launch adulterations under different names. That allows you to drop a brand extension in case of failure.
In other words, no matter how you might react to the concept, Coke might be right. Maybe there are places where the new Coca-Coffee or whatever they call it might work. What you get at a McDonald's in different parts of the world could include curry sauce for chicken McNuggets; a burger with cheese, bacon, and an egg; a burger with a slice of beet; or the McVegan, a soybean steak on a bun.
According to the CNBC report, Coke has come out with combinations of soda and coffee before: Coke Blak in 2006 (gone in 2008), Coca-Cola Plus Coffee in Australia two years ago, and now tests in Asia with a combination that smells more like coffee. So, maybe Coca-Cola actually is doing something intelligent because it has the resources.
Sometimes the difference between an insane-sounding idea and a sound business decision is patience and resources for testing. But in a startup or emerging company, both the patience and testing may be in short supply.
The lesson then is to first build the core business and then, when you get to a point of brand extensions, take the time to do the research and test the concept. Years ago, I remember having read a description of this as permission marketing. Your customers decide what the brand may and may not do. Be sure that the right people give you a thumb's up.