Starbucks entering the single serve coffee market!

by chee Leng (on coffee makers)
(Singapore)

Since November, when Starbucks announced their seperation from Tassimo, the market is abuzz with rumors on what would Starbucks do to enter this fast growing coffee segment.

Currently, Keurig occupied the US market with more than 80% market share while Nespresso has better exposure in the international market.

Both are enjoying phenomenal sales, so it is timely that Starbucks would choose to enter the market at this time.

Moreover, with the recent launch and success of Coffee Bean and Tea Leaf CBTL single serve coffee maker, it further highlights the potential of a coffee chain selling and succeeding at selling a single serve coffee maker.

While, Starbucks has not announced anything concrete (saying that it would do so soon), its spokesperson Wyss did hint that it is going to transform the market that Apple did with its i tunes and Iphone.

That statement, in my views meant coming out with their own single serve coffee system, that is the only way that they can control what goes into the system.

The fact is, Starbucks is already experimenting with retailing, using their via instant coffee.

With the relationship in place with its distributions outlets (that includes the supermarket), it is easy for them to start selling the whole solutions.

This couple with the fact that a Starbucks outlet is always near by, make selling a single serve coffee system to consumer very viable.

This would however, be making a big change to their positioning. Starbucks meant F&B retailing, while single serve generally is domestic consumption.

The tough part is to grow its market without cannibalizing its coffee shop business.

Regardless, I am looking forward to seeing this new single serve coffee solution that is coming out from Starbucks...