Beverage maker The Coca-Cola Co (NYSE: KO) is on a mission to invent a new coffee experience rather than competing against industry giant Starbucks Corporation (NASDAQ: SBUX), according to CEO James Quincey.
Quincey, a native of the United Kingdom, oversaw Coca-Cola's recent acquisition of UK-based coffee chain Costa. Doing so is part of Coca-Cola's new coffee business, which is divided into three parts, Quincey told CNBC's Jim Cramer in an interview aired Friday.
First is the "read-to-drink" coffee segment, followed by the "at-home" segment and the immediate consumption segment.
The biggest of the three coffee groups is immediate consumption, and Costa operates a business of high-end coffee vending machines that are found in gas stations, shopping malls and even movie theaters. A coffee vending machine is a "store in a store" that satisfies consumers' need for instant coffee and there is a "lot of white space" across the world, the CEO said.
"So there's a massive opportunity to partner with customers to sell more coffee, really high-quality barista coffee, in someone else's store."
Cannabis: Waiting For The Science
Coca-Cola is in no rush to follow suit, as cannabis doesn't yet check off three key components for the company, Quincey said.
First, cannabis is illegal in the U.S., and even in Canada, cannabis beverages aren't yet legal, he said. Second, the "science is out" on whether it is safe — and Coca-Cola won't sell a product unless it is "indisputably safe," the CEO said. Third, Coca-Cola is in the business of selling beverages that "people can drink each day."
The company isn't looking to enter a new business where consumers "have something once," Quincey said.
"f you can't cross [off] those three things of legal, safe and consumable, it's not an ingredient that's going to work for us."
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