“The year 2023 marks the 137th year of Coca-Cola’s existence. Over the past 100 years, the company has created so many classic products and wonderful memories for us, all of which are related to one word – “innovation”. Coca-Cola’s 137-year history of business development is also a 137-year history of innovation: innovation that involves the research and application of raw materials, improvements and innovations in formulas and processes, changes in packaging and functionality, and even the development and updating of beverage vending equipment.
All of these innovations have energized Coca-Cola’s growth steadily over its 137-year history. Which begs the question: what exactly is Coca-Cola’s secret to innovation?
At the FBIF2023 Beverage Innovation Sub-forum, Song Qi, Senior Director of Asia Pacific R&D Center, The Coca-Cola Company, shared Coca-Cola’s innovative thinking around “The Coca-Cola Company: Innovation for a Better Future”. The Coca-Cola Company is a full-category beverage company, and we have always been committed to providing more products that are better suited to consumers and more popular with them, including different categories and different packaging. We also pay close attention to and conduct long-term research on consumers’ changing preferences, as well as their changing tastes, lifestyles and purchasing behaviors. These studies have always guided our innovations, which have helped us shape the portfolio of products that we present to the market and to consumers at a given point in time. To summarize Coca-Cola’s innovative thinking, I think we are consumer-centric and stick to the sustainable path of development.
1. Consumer-centered, creating “five senses, six senses” new experience
Adhering to the consumer-centered approach can provide specific solutions for consumers and manufacturers; while adhering to sustainable development lies in the fact that the solutions we provide are sustainable and can help people improve their lives and enhance their sense of well-being, and at the same time, we also adhere to our responsibilities and commitments to society and the environment. Shown here are the five categories that Coca-Cola currently produces and sells globally, including the traditional classic fizzy drinks, as well as some very popular products such as low-sugar and zero-sugar, and we are also bringing tea, water, fruit juices, dairy drinks, plant-based beverages, and alcoholic beverages to a wider audience.
These products are presented in different packaging forms, either in plastic bottles, glass bottles, metal cans or paper packs; in family size or mini size, the list goes on and on. We believe that our consumers will be able to choose a beverage they like in any scenario. But we don’t just attract consumers with flavors or good looks, Coca-Cola also links and interacts very closely with consumers through music, culture, food, and lifestyle. How do you achieve consumer-centric and sustainable innovation? This can only be achieved through a deep understanding and interpretation of culture and macro trends.
Regarding macro trends, here is a list of keywords that I believe are not unfamiliar to my peers here, because all of us are focusing on these aspects in our companies, and they will affect the development of our business in one way or another, to a greater or lesser extent. What is culture? Defining culture is not simple, and ChatGPT gave me a definition that I think expresses what I was thinking at the time:
“Culture includes the beliefs, values, behavioral norms, customs, knowledge, and arts that are created and passed on by human beings at the social and individual levels. Culture can be transmitted through education, language, traditional practices and the media, and it reflects the history, lifestyle and identity of a particular group of people and helps to shape individual and collective views and behaviors. The cultures of different regions and groups are characterized by specific features, and the diversity of these cultures adds to the richness and depth of the human world.”
I really like this quote, I think it fits very well with a lot of my sporadic thoughts at the time that our interpretation of culture needs to be integrated into our business actions, and this quote in particular emphasizes the importance of integrating culture and trends into business actions. Insight into culture is actually a process of understanding people, things, people’s relationships with people, people’s relationships with things, links between things, and even the way culture operates in a given context. In this process, we are able to identify potential customers, and we are able to tap into the problems faced by this group of potential customers, which in more popular terms are the pain, itch and pleasure points of these customers. Our products and services are designed to provide these customers with solutions to their pain, itch and pleasure points. This is where I want to emphasize the importance of culture. Social level of culture and brand culture market colleagues will talk more, I as a focus on product innovation, I want to return to product innovation.
This year, the industry often says “roll”, roll the sky and the earth. Back to the research and development personnel, I also feel this volume. In the past, the basic requirements for researchers were to have deep scientific knowledge, passion for science and technology, pay attention to cutting-edge technologies, and apply these technologies to products to improve the taste, stability and appearance of products. But today, I don’t think that alone can help us provide consumers with a perfect, or complete, solution.
Consumer-centricity has two aspects: one is material satisfaction and the other is spiritual satisfaction. After providing the pleasure of taste, how to make the product become an emotional support? For example, if you also add Vitamin C, I also add Vitamin C, he also adds Vitamin C, our product solutions are all the same from a certain technical point of view. How to make consumers buy mine instead of yours and his? This time requires us to let the consumer to the product to generate trust, produce links, have emotional attachment. Our product innovation actually needs to provide consumers with “five senses and six senses”: on the one hand, the “five senses” is the sense of respect, nobility, security, comfort and pleasure, containing a lot of spiritual aspects of the influence of factors; on the other hand, the “six senses” is the sense of respect, nobility, security, comfort and pleasure. On the other hand, the “six senses” include vision, smell, taste, hearing, touch and perception, with more emotional factors. This requires researchers to have not only deep scientific and applied skills, but also the ability to integrate culture into innovation and help build culture in our products and brands.
This is why culture and trends must be integrated into business initiatives, and as R&D people we need to do the same. It was mentioned earlier that culture has very different characteristics in specific communities and specific populations, which brings richness, diversity and depth. This is reflected in the complexity of consumer needs, which have guided us to develop and innovate many products that present consumers with many different experiences to meet their different needs.
The next example I’d like to share with you is how our company combines culture and meets these deeper consumer needs at the same time. Last year, we launched a new innovation platform, Coca-Cola Boundless, which is a global innovation platform and Coca-Cola’s newest expression of innovation based on internal and external collaboration and cultural links. “Inspired by the latest music, gaming, cultural and digital experiences in the real world and in the digital world, we are presenting consumers with new products and experiences in terms of flavors, packaging design and digital experiences. These products are limited editions and have been on the market for a relatively short period of time. We want to build links with young people in this way, so that Coca-Cola can really engage with young people’s aesthetics, understand their thinking about culture, and have some fun with young people – this is the main idea of our innovation platform.
Each product has a theme, such as the space-themed “Star River Walk”, the digital-themed “Rhythmic Cube”, and the game co-branded “Heroes Arrive”, which was launched in early June. The “Hero’s Advent” was launched in early June, co-branded with the game. Everyone is welcome to try it out and feel the impact of youth culture. On this platform, we incorporate the need for private customization and provide socialization. Consumers can scan the QR code on the package and participate in interactive and mini games, which also enables a digital experience. More importantly, we have redefined the experience, the “five senses and six senses” mentioned earlier. This kind of innovation can be a comprehensive innovation, end-to-end innovation; it can also be a breakthrough at a certain point in the middle. It provides us with a lot of inspiration for innovation.
With this kind of innovation, we are presenting consumers in the Asia-Pacific region with a very rich choice in 2022.
This is Coca-Cola’s idea of innovation, we focus on consumer needs, insist on sustainable innovation, start from the understanding of culture and trends, and grasp the needs of consumers at the moment. Through comprehensive innovation or point breakthroughs to provide solutions to our consumers in different scenarios.
2. Adhere to the path of sustainability and find inspiration for innovation in challenges
Our innovation is also sustainable. Take Coca-Cola’s sustainable packaging as an example. Reducing waste and carbon footprint have always been our core values, and we have adhered to this principle in our packaging innovations. But actually sustainable innovation also comes from insight.
A few years ago I worked in Japan for a while, and I noticed that our colleagues in the lab would carefully peel the labels clean every time they finished a drink, separate the caps from the bottles, and put different materials inside different trash cans. I later learned that this is a hard and fast rule for environmental protection in Japan, and it is mandatory for everyone. This helps to increase the recycling and reuse efficiency of different packaging materials at a later stage. This invariably also causes some problems for consumers: when every empty bottle has to be disposed of in this way, consumers have to take the bottles back with them even after they finish their drinks outside, because there are fewer and fewer trash cans on the streets of Japan.
This is a pain point that many beverage companies have also noticed and have come out with some solutions one after another, such as easy-to-remove triangular labels and easy-to-remove strip labels, which does reduce the nuisance of not being able to tear cleanly, but does not completely solve this pain point. Especially when consumers are at home, when they drink their familiar products, they don’t need labels at all, and they won’t even look at them.
We did a consumer research in Japan to find out if there could be other options, such as taking the label off altogether.In 2015 we listened to consumers and made a bottle with the label completely removed. But the reality was very complex, and here’s what consumers said when they saw the bottle, “This product looks bland,” and “This product doesn’t have any brand identity to give me an identity, and it doesn’t represent my tastes or choices.” We have created more distress while removing labels. It was clear that simply being label-free was not enough to impress consumers. This created more challenges for our engineers and designers. So our designers searched everywhere for inspiration, and were finally inspired by a clear river and the dynamic flow of water plants at the bottom.
Using beautiful lines to carve the flow on the bottle also brought us back to the core of this product, which is to provide consumers with the taste of pure, natural water, and to reflect this crisp, delicious feeling through the design. At the same time, our engineers used engraving technology to print the brand’s name and image on the bottle and the bottom of the bottle, so that we, the consumers, can still get the brand’s identity when they get this product. And most importantly, sustainability, as we made the bottles from 100% recyclable plastic and launched them in the Japanese market. The result is a comprehensive solution that provides consumers with a premium product that tastes great, has a brand identity, and retains a premium feel in their hands, all while staying on the path to sustainability.
Finally, Coca-Cola’s first label-free bottle was successfully launched in Japan in April 2020, which has been well received by consumers since its launch and has brought us welcome growth in our e-commerce platform. So what do we do when we want to take a product from a single e-commerce channel to a multi-channel one?
We found a better design to print the sales barcode on the bottle cap using printing technology. Adding product information on the bottle with laser printing technology helped us move from a single e-commerce channel to multi-channel. The two products we just talked about are water, so what about the rest of the category? We opted for a bigger challenge and wanted to incorporate innovation into the classic Coca-Cola glass curved bottle.
Speaking of glass bottles, I would like to tell you a little story: in 2016 I saw an exhibition in the United States about the Coca-Cola Glass Arc Bottle, and the floor was presented with broken glass. More than 100 years ago, the Coca-Cola Company’s Coca-Cola products were very popular, but at that time there were also a lot of imitators, which caused the company a very big trouble. At that time, everyone used pretty much the same glass bottles. We asked the packaging design company we worked with to create a bottle that could be easily recognized as Coca-Cola, both in the dark and when broken. Our packaging designers were inspired by the fluted silhouette of a cocoa pod, and came up with a prototype for a glass curved bottle. How did we iterate from the glass curved bottle to the new PET curved bottle? We used the same embossed engraving technique to print the Coca-Cola brand on the bottle. But now we’re using a 100% recyclable plastic bottle, and it’s an ultra-lightweight bottle, which is a very typical example of our innovation in support of sustainability.
In addition to product innovation, packaging innovation, there’s one last example I’d like to talk about of Coca-Cola’s innovation in beverage vending equipment. This is the Freestyle vending machine, which we introduced for the first time in North America. First of all, Freestyle can customize the menu, it can provide 30-200 different combinations, consumers stand in front of the machine through an interesting interactive interface can choose a single traditional drink, or according to the mood and ideas at the time, any mix of a drink. In this process, we also incorporate a lot of high technology to ensure the quality and taste of the product. After repeated industrial adaptation, adjustment and standardization, it finally became the glass curved bottle that we all know very well today. This device helps us to reduce ready-to-drink packaging, and consumers can use duplicate packages to purchase beverages at the vending machine. Currently, Freestyle vending machines have been launched in Japan, Singapore and Malaysia.
The above is my speech today, to share some ideas and experiences with you, and I hope to encourage with our peers. Together, we will provide consumers with more products that are suitable, popular and loved by them, and stick to a sustainable path to create a better future for the world. Coca-Cola will also continue to uphold the original spirit, “The world is different because of me”.