KGM sells many different beverage-related products, from Arabica coffees to beverage systems. They attribute most of their increased revenues to the popularity of their Keurig brewers. Their beverage systems are sold to consumers at cost or at a loss. However, most of their profits are made through the selling of accessories and Keurig beverage related products, such as the portion-packed coffee cartridges known as K-Cups, which can only be used in the Keurig brewing systems. With the increased popularity of the Keurig system, KGM has increased their investments into research and development (R&D) which consists of salary, consulting expenses. However, their increased revenues have stayed well ahead of their costs. For the fiscal year …show more content…
In addition to refinements to their existing product line, they are also seeking to introduce a new cold-brewing system, which will allow for expansion into a new beverage market. The project has been in development for over five years, and the company continued its commercialization of the product during 2014, with an anticipated introduction to the market in fiscal year 2015.
While the company has been hugely successful with its current model and offerings, there remains a risk of stagnation, as the competitors grow and develop their own new technologies. The intended product line will allow for easy home production of carbonated beverages, enhanced waters, sport drinks, and other cold beverages using the same portion-pack technology as the hot-brew system. It is also intended to address limitations that exist in their competitors’ cold-beverage systems, with improvements that include:
delivering the beverage at cold temperatures, instead of ambient/room temperature;
offering consistent and simple (single-button) carbonation processes;
enabling consistent and exact dosing of different flavors and carbonation levels;
Similar size to the current hot-brewing system (ideal for countertop), and similar
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The larger serving size of Great Cups of Coffee is perhaps the most apparent gage that will improve appeal for the company’s customers. Receiving extra of a proportionately quality product for a comparable price obviously works as an enticement for customers to prefer Great Cups more than the opposition. While customers identify with a better quality and superior taste with fresher coffee, Great Cups supports its effective model of serving coffee that has been roasted no more 72 hours ago and that is blended and ground right at the store. Great Cups also provides as an unintended marketing method community bulletin boards and assists with book club gatherings as well as
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.
The founders of Keurig Inc. created the company to develop an innovative technique which allows customers to brew one perfect cup of gourmet coffee at a time. In this case, the CEO Nick Lazaris along with the other leaders of Keurig Inc. must determine how to successfully enter the at-home-market for use at customers’ homes, while maintaining a healthy relationship with Green Mountain Coffee Roasters, Inc. (GMCR) and Van Houtte. GMCR and Van Houtte are two of the company’s main roaster partners that own a 70% stake in Keurig, so they want the business to succeed but are a little apprehensive about the company’s marketing and pricing strategies.
Boston Beer Company has always structured themselves as a craft beer maker. Their strategy is to always strive to give their loyal customers a “better beer”. Their idea of a better beer includes giving their customer a higher quality, a better and unique taste, and a sophisticated image. Along with the strategy to a better beer for the customer, Boston Beer and Samuel Adams also pay close attention to their operations strategy. Their operations strategy includes paying close attention to the brewing process from start to finish. The producers are involved in every step of the brewing process. They hand select all of the raw materials, they br...
The purpose of this case study is to explore the implications for expanding the products offered by Mountain Man Brewing Company (MMBC) from one product, Mountain Man Lager, to adding a Light version of the beer. This paper will evaluate the following:
As stated in the case, “the market for energy drinks was growing; between 2010 and 2012, the market for energy drinks had grown by 40%. It was estimated to be $8.5 billion in the United States in 2013 [and] forecasts projected that figure to reach $13.5 billion by 2018” (pg 5). However, much of this market’s revenue -- 85% in fact -- is dominated by five major brands, while the remaining 15% is split between approximately 30 regional and national companies. (pg. 5). With this saturated market, it might not be best for Crescent Pure to enter as a completely new product to the industry, as there is the possibility that it will be squeezed out of the profit shares by more established brands -- especially if it is not properly secure in its identity. In addition, while the market for energy drinks appeared to be growing at an exponential rate compared to the market for sports drinks -- which increased only 9% in five years and would be at approximately 60% of the rate for energy drinks in 2017 (pg 6) -- the consumers appeared to be wary of partaking in the market for several reasons, which would potentially harm the reach of Crescent Pure. These concerns included rising news reports discussing the safety of energy drinks (pg. 5). Taking into consideration the data provided in the case that concerns reasonings of why consumers choose specific drinks over others, there
The soft drink industry in the United States is a highly profitably, but competitive market. In 2000 alone, consumers on average drank 53 gallons of soft drinks per person a year. There are three major companies that hold the majority of sales in the carbonated soft drink industry in the United States. They are the Coca Cola Company with 44.1% market share, followed by The Pepsi-Cola Company with 31.4% market share, and Dr. Pepper/Seven Up, Inc. with 14.7% market share. Each company respectively has numerous brands that it sales. These top brands account for almost 73% of soft drink sales in the United States. Dr. Pepper/Seven Up, Inc. owns two of the top ten brands sold. Colas are the dominant flavor in the U.S carbonated soft drink industry; however, popularity for flavored soft drinks has grown in recent years. The changing demographics of the U.S population have been an important factor in the growing popularity of these flavored soft drinks. The possible impact of this factor will be addressed later in the case.
Analysis of the carbonated soft drink (CSD) industry shows that there are 2 important players i.e. Concentrate Producers and Bottlers. Focusing on the downstream of the supply chain it is to be pointed out that concentrate producers incure relatively low fixed costs with respect to production plant, staff, equipment and R&D as the concentrate is produced of a more than 100 years old formula and relatively cheap raw material (e.g. caffeine). Concentrate is shipped to bottlers which incure relatively high fixed cost with respect to plant, equipment and staff and which add carbonated water and high fructose corn syrup to the concentrate, bottle or can, package and ship it to the respective retailer. Besides that CDS hold a big stake in the direct delivery of concentrate to diverse fountain accounts like McDonalds, Burger King etc.
Kinko’s has been losing revenues and market share over their competition for the past years; reason why its directors have been doing market research to understand the causes of their business slowdown. It’s fast growing market had substantially developed an ongoing business model, facing changes, rapid expansions & even mergers. Their model of service solutions was not fitting their customer’s needs any longer…now it is needed to increase revenues and fast.
The beverage industry is highly competitive and presents many alternative products to satisfy a need from within. The principal areas of competition are in pricing, packaging, product innovation, the development of new products and flavours as well as promotional and marketing strategies. Companies can be grouped into two categories: global operations such as PepsiCo, Coca-Cola Company, Monster Beverage Corp. and Red Bull and regional operations such as Ro...
This competitive advantage has been rendered sustainable as other players have found it difficult to catch up with the company's competitive strategy. In spite of this clear advantage, it was noted that the company faces some challenges being the world leader in soft drink distribution. The canning and bottling of the product which is done in many countries have now fallen into the hands of independent companies, thus it becomes hard for a given company to control the quality of the packaging
Experimentation with the new market for carbonated beverages on the decline coke has done experiments in new flavors and healthier alternatives to try to stay competitive. As well as investing in “Keurig Green Mountain is a K-Cup maker but has a new Keurig Cold that can deliver Coca-Cola through the new system.” (Cooper, 2014)