Case 2: Keurig Green Mountain Strengths: Market Growth: Coffee consumer numbers are rising worldwide. According to The Business Insider coffee falls second after crude oil and has a worth of approximately $100 billion. Keurig Green Mountain has a large market to target. The coffee industry is not only growing but coffee consumers are willing to pay the price for their daily caffeine boost. The growth in this industry is definitely a strength for Keurig Green Mountain and also an opportunity that should not be wasted. The Keurig and coffee: When the Keurig was first introduced it was a new product in the market. Its purpose was to provide the consumer with a fresh cup of coffee almost instantly (within 1 minute). Providing the consumer with …show more content…
A great aspect of The Keurig is that it is easy to use. User friendly products encourage customers to purchase the product and increases the product satisfaction ratings. Variety: According to the article, The Tyranny of Choice, “thanks to a mix of modern medicine, technology and social change, choice has expanded from the grocery shelf to areas that once had few or none.” This article states that the more varieties you have of a product the more difficult it becomes to make a decision. On the other hand, I believe that the customers want variety tailored to their own needs and wants. I consider that a strength of Green Mountain coffee is the variety of choices they offer to the customer ranging from coffee, tea, chocolate and other beverages. Customer satisfaction and strong loyalty: The Keurig has high customer satisfaction ratings. Not only does data demonstrate this, but I can attest to it myself. I bought a Keurig about a year ago. I love it and I use it every morning for my coffee and in the evening to make my night tea. After I purchased it and discovered how amazing it is I bought one for my mother. My sister after using it also bought one to give to her mother-in-law. Green Mountain Coffee, definitely satisfies and retains …show more content…
When Green Mountain released the new Keurig 2.0 several law suits came along. Companies are doing so on the bases of monopolization. Law suits = BAD Several competitors have already threatened Green Mountain by declaring that there are plans of hacking or copying the DRM. If this is so, the DRM was not a good idea to begin with. = BAD Digital Reader states, “It’s bad enough that we have to put up with proprietary cartridges for our printers, but to also have that perfidious idea spread to another market?” Strategic Recommendation: My recommendation is that Green Mountain find a strategy to open the K-cup market to other companies. I suggest that Green Mountain work with third parties instead of pushing them away. I recommend that they implement a friendly contract where Keurig is the sole producer of The Keurig but Green Mountain allows other companies to sell the K-cups to
Geoff Herzog is the product manager for coffee development at Kraft Foods Canada. After reviewing successful results of single-serve coffee pod systems, he wondered whether it would be successful in other areas. It was July 6, 2004, and Herzog had just learned that Kraft Foods North America was planning an aggressive launch of coffee pods in the United States. He then had only a month to decide whether or not the company should proceed with a simultaneous launch in Canada, or await the U.S. results.
Seattle-based Starbucks recently announced another price increase for all milk-based beverages at the largest coffeehouse/coffee bar chain in the world. With its trendy appeal and shop on every block personality, Starbucks built itself into one of the premiere brands in the world alongside Google, McDonalds, and Coke. With growth comes competition from all directions. Along with longtime Starbucks enemy Dunkin Doughnuts, a new contender for the java king title has emerged as new java joint, High Point Coffee pushes its way into the fray. Based in Mississippi, the newbie java spot has only been in business for less than five years. However, with its surge in revenues and customer retention, executives recently decided to push the brand nationally, going into direct competition with what they call
The key fact that propelled Keurig was that while a lot of brands had single servings of traditional coffee or limited options, Keurig had seventy-five flavors at launch that fared well with consumers looking for more variety. Additionally, Keurig also had the ability to sell their coffee packs via multiple channels while other competitors had only online distribution. Finally, Keurig simply had a better performing machine that was received well by reviewers and consumers alike. Because of the many convenient ancillary benefits that were attached with their product, Keurig was able to sell their machine at more than two times than their closest rival. It is evident that because of their high cost and focus on consumer convenience and variety, Keurig always had envisioned and employed a differentiation
It enabled superior tasting coffee. Keurig was unique in the way that they had a patented portion pack system. It contained the coffee beans and also the filter system. Another unique element was the coffee replicate system which allowed the issue of choice like in gourmet coffeehouse. Keurig coffee was produced by four coffee roasters creating more than 75 varieties available.
Why spend two dollars for a coffee from Starbucks when you could spend a dollar at Dunkin Donuts or even McDonalds? Everyone knows Starbucks is more expensive but that doesn’t stop them from buying it. At 10 am the Hazard Ave. Starbucks always has a line out the door. Why don’t those people just travel a minute down the road to Dunkin or McDonalds to get cheaper coffee? What it comes down to is, are you willing to pay more for a better taste coffee? Although some may argue that McDonalds or Dunkin’ has better coffee. Every person develops their own taste for coffee, whether they like it with cream and sugar or black. Personally, I’m a fan of my coffee with a little bit of milk. It really allows...
Emphasis on quality, Starbucks Experience, brand image, and important suppliers to dispute lower price contributions to competitors hence increasing profits
3-2. Are the critics overreacting to the situation? Do you think Keurig Green Mountain’s managers are handling this situation in the best way, ethically and responsibly? What else could they do to be more ethical and responsible?
Nespresso is a system that allows the consumer to make a fresh cup of espresso quickly and easily at home. The system is based on two parts: a coffee capsule, (a premeasured freshly ground coffee in an aluminum pod,) and a machine. The use of a Nespresso system is quick and simple: fill water container with water, turn machine on, drop in the coffee capsule, close handle (which pierces the coffee capsule), press button. This results in a high-quality cup of espresso, which rivals those of most coffee shops. Nespresso offers a number of different machines with varying functions and coffee cup capacities. They start out with a machine with only a two cup size option and no extra features and can go as far a...
According to IBIS World Report the major players in the US coffee and snacks retail market are Starbucks and Dunkin’ Brands at 36.7% and 24.6% market share respectively with other competitors occupying the remaining market share of 38.7%. The industry is at the mature stage of its life cycle, has low barriers to entry and intense competition and rivalry between the players. The regulation and technological change within the industry is medium (IBIS world report)
Coffee is much more than the hot, black liquid that millions of us drink every morning; it is a worldwide commodity that has been keeping us awake for hundreds of years. It seems that a coffee shop can be seen on every shopping center and a coffee pot in every work break room. Our lives today revolve around coffee, regardless if we drink it or not, and ironically it not only stimulates of senses but also our economy. We wouldn’t be able to imagine Bill Gates not with his cup of coffee making Microsoft in his garage, or Henry Ford waking up early to perfect the auto industry and the assembly line. The economics of coffee may not be a simple one to study, but it is one you will be kept up all night learning about.
Starbucks Coffee, Tea, and Spice opened its first store in April 1971 in the Pike Place Market in Seattle, by owners who had a passion for dark-roasted coffee that was popular in Europe, but hard to find in the U.S. (Harrison et al., 2005; Venkatraman & Nelson, 2008). The company’s mission was to provide Seattle with the best access to dark-roasted coffee, and sought to educated customers about the product. As a matter of customer education and acceptance of the product, Starbucks grew and expanded into the successful domestic market it is today. Much of this success can be attributed to a focus on the total customer experience and s...
This will not only maximize the company’s operational expenses by concentrating only to a particular segment of the age bracket of consumers by providing them product lines that will suite their taste and demands it will also allow the company to set the trend as to what is the next big exciting thing this season. In this case, the company’s resources will be used properly and is expected to increase its market share continuously leaving the competitors far behind. (Starbucks,
Drinking coffee has always been a strong culture in Malaysia.There was a survey that showed that Malaysian drinks 2.38 cup of coffee daily. Drinking coffee used to be an early morning routine, but now it is an all-day activity. As Malaysian’s drinking coffee habit is rising significantly, the coffee house business is also grown along with the drinking habit. Coffee house in Malaysia was started from a traditional chinese coffee house that called as kopitiam. As the west culture started to influence the market, they introduced Malaysia to a “cafe” concept. International coffee shops chains started to enter the Malaysia coffee shop market with the cafe concept applied. In fact, this concept seems to attract generation Y as the customer. Starbucks coffee is one of the most famous and successful international coffee shop chain in Malaysia. Starbucks was first opened in Seattle in the year of 1971. It grew very intensely and now it owns 16,635 stores all over the world, included 115 stores in Malaysia. Starbucks got in to the Malaysia market through the mode of licensing. Berjaya Corporation Berhad obtained the license to operate Starbucks Coffee. Just like another coffee shops, Starbucks Coffee sells coffee-based drinks, non-caffeine beverages, tea-based drinks, coffee-related souvenirs, equipments, and coffee beans. Starbucks coffee is now one of the most successful coffee shops among the competitors. Even there are lots of international coffee shop chains such as coffee bean and San Fransisco coffee, also other new independents local coffee shops with cafe concept, starbucks still able to manage the loyalty of their customer. But in the other hand, there have been some words of mouth that said that for a coffee shop tha...
Even though dunkin has started a green campaign, there was levels are high. All the coffee and beverage cups that they go through each year are tremendous waste. If Dunkin Donuts would use more recycle materials and cut down waste and would set the trend for other coffee companies. Dunkin Donuts has a global presence but what they should be focusing on is nationally. Most of Dunkins Donuts restaurants are on east coast and heavily centralized in north eastern America. They should focus more nationally and expanding more westward. Opening up more restaurants in California would increase profits and expand to other markets in the U.S (Opportunities and Threats). While being international and competing with other business it leaves them with a limited market share growth. The customers of the coffee industry are very brand loyal which makes it hard to gain new customer clientele. With Dunkin Donuts being a franchisee business there is a trend of riffs between owners. There should be a set of guidelines that each owner has to follow because they are representing the Dunkin brand. Dunkin has a wide variety of coffee, beverages, and breakfast food items but most of these items are high in saturated fat. There has been a trend of healthy and organic eating; Dunkin has yet to offer such a menu to accommodate this clientele. Dunkin has entered the app online system to promote and advertise but that isn’t enough. Most
In addition to being best-known supplier of the finest coffee and promising only the highest quality products, Starbucks emphasizes firm values, provides guidelines to enhance employee self-esteem. This is to ensure continued customer satisfaction. Moreover, diversity has become a priority to providing an inviting environment to all consumers. Starbucks continues to abide by a strict, slow growth policy in which they set out to dominate a market before moving on to expand, thus history has shown this strategy to be successful for Starbucks, making them one the fastest growing companies nationwide.