Why Keurig’s $300 Cocktail Machine Failed

The joint venture with Anheuser-Busch was no Juicero, but is still an object lesson on the need to test assumptions

Rita McGrath
Marker
Published in
10 min readFeb 7, 2022

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Drinkworks

Two companies needed a new growth vector. One was great at branding alcoholic beverages. The other was great at making home appliances that customers could use to create self-serve beverages. A match made in heaven! Or maybe not…

When companies make a product that has more to do with their own needs than with solving a real customer problem, the results are seldom pretty. One of the latest casualties? Drinkworks, the product of a joint venture between ABInBev and Keurig. Both of the parent companies have been grappling with strategic growth issues. People aren’t drinking as much beer as they used to (or at least as much of the kind that Anheuser Busch sells) and Keurig has long lusted after finding markets beyond coffee for automatic home preparation.

The history

Drinkworks was founded in 2017, funded by AB InBev’s venture fund, ZX, as part of a joint venture between the highly successful coffee pod maker Keurig Dr. Pepper and Anheuser Busch. The technology behind the at-home drink maker was underway at both companies, reportedly, for over ten years. While I don’t have any insider information, it…

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Rita McGrath
Marker

Columbia Business School Professor. Thinkers50 top 10 & #1 in strategy. Bestselling author of The End of Competitive Advantage & Seeing Around Corners.