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Nestle Tests Canned Coffee Drink, Pepsi-Starbucks Test Expected Soon

April 19, 1995

NEW YORK (AP) _ Some of the biggest players in the soft drink business are getting ready to see if Americans have a taste for cold coffee.

The Nestle Beverage Co. and soft drink leader Coca-Cola Co. announced Tuesday they had begun a limited test of ready-to-drink Nescafe coffee in Burlington, Vt. The drink comes in four flavors in 9.5 ounce cans.

It is initially being sold only through convenience stores and vending machines, according to Nestle spokesman Tony Adamich.

Pepsi-Cola Co., the nation’s second-biggest soft drink company, and Starbucks Coffee Co. of Seattle are expected to announce they will begin testing a cold, carbonated coffee later this month in Santa Monica, Calif.

That would be the first beverage from the Pepsi-Starbucks venture called the North American Coffee Partnership formed last August.

Officials familiar with the plans said the drink will be called Mazagran and will initially be sold by the cup at two Starbucks stores in Santa Monica.

The plans are that the beverage will be made available this summer in bottles at supermarkets and convenience stores in the Santa Monica area.

Ready-to-drink coffee offers only the latest battefield for Pepsi and Coca-Cola and it is far from clear whether there is a market for the drink.

Coffee is said to be the second most popular beverage in the United States behind carbonated soft drinks with per capita consumption of 26 gallons a year. But Americans generally prefer to drink their coffee hot.

At the moment, the market for ready-to-drink coffee _ coffee sold in single servings in bottles or cans _ has been estimated at less than $50 million at wholesale in the United States and is usually seen in regional brands.

But American consumers have exhibited a taste for alternatives to carbonated colas and soft drink makers have sought to satisfy that thirst with a proliferation of teas, fruit drinks and sports drinks.

The new Nescafe coffee is non-carbonated and comes in the flavors Cafe Au Lait, Mocha, French Vanilla and Arabica Dark.

Coca-Cola and Nestle have cooperated for several years in developing teas and coffees overseas but this is their first coffee drink in the United States.

Nestle, based in San Francisco, is manufacturing and marketing the new drink while Coca-Cola Bottling Co. of Northern New England will distribute it.

The Burlington test is designed to assess the technical and operational aspects of producing the drink and no plans have been made for broadening distribution, according to Nestle’s Adamich.

He said Nestle also plans to use the Burlington test to try out broadcast advertising approaches and give consumers samples of the product to gain some insight into when and how often they drink it.

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