Starbucks Keurig Campaign

Starbucks Keurig
Campaign
Nick Conte
Emily Fitzpatrick
Liza Hood
Carolyn Lenahan
Janelle Scudder
Starbucks Background
• Original store - 33 years ago in Seattle, WA
• Now a 4.1 billion dollar international company
• Operating in more than 50 countries with 17,009
(and counting) stores
• More than 30 original blends of coffee
• Partnering with Keurig would only be beneficial
to Starbucks
• Mission Statement: “to inspire and nurture the
human spirit – one person, one cup and one
neighborhood at a time”
Keurig Background
• Green Mountain Roast Coffee - owner of
Keurig
• Keurig machines - single cup coffee makers for
the home and office
• "K-Cups" are single units containing the
brewing material • They are easily inserted into the machine, and
beverage is ready within 20-60 seconds
• Many varieties and flavors of K-Cups
Situational Analysis
• March 1st Starbucks terminated its deal with
Kraft to develop products for its Tassimo
single-brew machine
• March 10th Starbucks and Keurig announced
partnership, Starbucks will be Keurig's only
"super premium brand”
Situational Analysis
• Kraft's Tassimo accounts for only 3% of singlecup market while Green Mountain's Keurig
accounts for 80% of market.
• Shares of Green Mountain rose 41% while
Starbucks stock rose 10% following
announcement of deal.
Goals
• "To extend the brand beyond our retail stores"
Objectives
• Awareness: To have 75% of regular Starbucks
customers aware of Starbucks K-cups before
their release in the fall of 2011
Objectives
• Attitude: To have at least 80% of customers
consider Starbucks K-cup coffee to be just as
good as in store coffee by the end of the "instore challenge"??? (not sure what to call our
taste test)
Objectives
• Action: Of the 80% of Starbucks customers
who do not own a Keurig machine, have 50%
of these customers purchase a Keurig within
the first year of the release of Starbucks K-cups
SWOT Analysis
Strengths/Opportunities
• Only 20% of Starbucks customers own a Keurig
• Keurig dominates Market
• Premium Coffee customers have been the fastest
to switch over to single cup brewers • The United States single-cup market is estimated
at about $4billion annually and growing.
• Non-exclusive deal. Starbucks is free to explore
other single-serve coffee market opportunities
SWOT Analysis
Weaknesses/Threats
• Starbucks competitors (Dunkin Donuts,
Caribou coffee, and Foldgers) all are available
in K-cups
The Starbucks Customer
• The average Starbucks customer is 42 years
old, college educated, with a $90k income
• Skew to female consumers • Urban Commuter Family
Current Market Segment
Yuppies
• Young Urban Professional mid 20's to 30's,
college educated, well paid profession • "work hard to play hard" • "focus on making money to fuel a lifestyle filled
with expensive toys”
• date/marry other yuppies, double incomes
New Market Segment
Baby Boomers • between the ages of 46 and 64 • largest generation • "live to work”
• experiencing wealthy retirement lives • spend hard earned money on indulgences • "embrace new technology" • "baby boomer women are the fastest growing
group on Facebook"
Budget
$100 Million Campaign
Print Advertising- 40%
Social Media- 15%
Product Placement- 10%
Event Sponsoring- 15%
In-Store- 20%
Our Salaries-<1%
Media Tactics
• Starbucks exists as the "Third Place”
• Word of Mouth
• Bring "Third Place" to Home and Work
• Strategies: – Product placement in film/on TV – Event Sponsoring
– Print Ad
– In-Store Product Testing
– Social Media