As you may know if you have been following this blog, the goal of Coca-Cola Founders is to help solve some of Coca-Cola’s biggest growth challenges by partnering with experienced entrepreneurs. Like other established companies, Coke is great at developing solutions using our existing capabilities, but emerging technologies and business models are still largely being designed by external entrepreneurs. Coca-Cola Founders is a partnership approach to building these capabilities.
Recently, we’ve expanded our model to work with other companies, but before we get into that, just a refresher on how our model works.
Coca-Cola Founders approach:
1. Partner with a Coca-Cola Business Unit to identify the business growth challenge where new tech and business model innovation could bring value. Some of these challenges include consumer engagement, last mile distribution, and out of stocks.
2. Engage with entrepreneurs who are physically close to the Coca-Cola BU headquarters. It’s essential the entrepreneurs can meet regularly, face to face, with the Coke team.
3. Immerse the founders in all things Coke. Help them understand the assets at their disposal and the fundamental “problems to be solved” across the growth challenge areas.
4. Support the founders as they build the business (capital, expertise across Coke, networking with other entrepreneurs, how to scale a company)
5. Integrate and scale solution across Coke. We help founders connect across Coke in order to scale the solution.
Coca-Cola Founders opens to other companies, starting with Walmart
After we proved this approach worked across 10 business units, we decided to open it up to other companies to create even more impact. A few months ago, we started working with Walmart to look into joint challenges.
Food Insecurity is a huge problem worth solving
1 in 5 American kids don’t have consistent access to food. Almost half of American families live paycheck-to-paycheck. One of the biggest pains middle class families feel is when there’s not enough money for the groceries they need. When a high bill comes or pay dips, parents skip meals or can’t feed their children the nutritious food they need. Walmart and brands like Coke miss out on sales.
Grocery Bank helps families always have enough food, even when budget is tight.. The service allows shoppers to “bank” groceries by pre-buying any Walmart grocery like milk, eggs, and meat. When a shopper pre-buys an item it goes into their Grocery Bank. It works like a virtual stockpile. Families then know they have the security of these “banked” items that they can take out when they need. Grocery Bank works through users’ phones, allowing them to easily pre-buy or withdrawal groceries anytime they want. Empowering families to save groceries makes for more consistent grocery budgets. With this, families get more reliable access to food and Walmart and brands like Coke get more sales.
Value for all 3 parties
When we partner with a customer like Walmart, we’re committed to ensuring we create value for all 3 parties: the shopper, Walmart, and Coca-Cola.
• For the shopper, this means they don’t have to go without when times are tight. Paychecks and bills can be unpredictable. Banking groceries helps families know they will have enough food next time budget is tight.
• For Walmart, Grocery Bank not only increases sales and frequency, but builds trust by helping shoppers in tight times.
• For Coca-Cola, more Walmart sales mean more sales of Coke’s product line though its biggest retail partner.
Some of Coca-Cola’s highest value SKUs in a store are the products in that small cooler in the checkout line. When shoppers are concerned about exceeding a budget, they may think twice about this purchase. We also have access to shopper insights that were previously unavailable that allows us to promote our products to the shopper.
The Grocery Bank test product is starting tests in Phoenix and the team is already gathering great insights. Shoppers using Grocery Bank are telling us the solution is giving them a peace of mind and they don’t need to worry as much. It’s still early days on both the model of working with another large company and also in the life of Grocery Bank. We’re excited to see how both develop.
We’re excited to grow this new dimension of our relationship with Walmart and use Coke’s capabilities to help build Grocery Bank into something that helps millions of families. We hope you keep following this blog as we share more about our journey.