Starbucks Instant Coffee Or For Mermaid.

Starbucks finally started selling instant coffee. Is this more powerful or gild?

Following the bid change in March 8th, in early April, Starbucks announced its start in the Chinese market. Sale Via brand independent packaging of instant coffee, sales area will be in the country's more than 800 supermarkets and convenience stores, and will also enter the hotel and entertainment venues in the future.

This is not the first time Starbucks has released outside its stores. Single product 。 Before that, glass bottle coffee beverage Star Ice music has been sold in global supermarkets and convenience stores. In 2009, it became a Starbucks core product with a sales volume of US $2 billion. The success of the star ice music series is also based on a Mazagran based frothy coffee beverage on the consumer goods market in Waterloo.

In the spirit of Starbucks, Howard Schulz's new work, "CEO Onward: How Starbucks Fought for Its Life without Losing Its Its", which is a new work of Starbucks's new Starbucks, "a way forward: how Starbucks inherits the soul for survival", Schultz reconsidered the way she used to rely solely on store expansion, and announced that she would lead Starbucks to a "restrained and healthy growth" approach to the future. "Moderation" means that Starbucks must stop simply. Finance Growth is the goal of rapid expansion, returning to its core concept of providing high quality coffee, spreading the culture of coffee, and trying to manage the emotional connection between people based on "third spaces". At the same time, we should carry out product innovation under the premise of closely related to its core business and value concept, and establish a diversified development structure of multi level and multi distribution channels, so as to expand the growth space outside the stores. In a more cautious and precise expansion, Starbucks needs a product that can deliver its brand core value, and can also take the star baton relay baton in the direction of integrating retail and distribution channels. That is to say, in the current transformation node, Starbucks needs Via.

Instant coffee is a product with a global sales volume of US $24 billion, which accounts for more than 40% of the total coffee consumption. In Britain and Japan, this proportion is more than half. As a representative of emerging markets, China's sales of instant coffee also increased by 13% last year. For Starbucks, which accounts for only 4% of coffee sales, the potential of instant coffee has attracted much attention.

At present, 70% of the global instant coffee market is occupied by Nestle. Nestle has realized the Enlightenment of coffee and the rapid popularization of the market through the small profits but quick turnover. It has also created a highly monopolized market and a lack of adequate competition. Its high-end market lacks an impressive brand. Because Nestle is too focused on exploiting channels and low cost, instant coffee has become a rare field of substantive innovation in the decades since World War II. This has brought enough market space for Starbucks's high-end gene and Via with its best-selling nature.

Although Via has squeezed into the market space where Nestle has long been entrenched, Nestle has begun to strengthen its marketing offensive to cope with Starbucks's entry, but it is hard to say how well the two sides will fight. First of all, the role played by these two brands in the market is seldom interrelated with the group they are facing. Take the Chinese market as an example, if Nestle brings the initial enlightenment of "what coffee is" to Chinese consumers, then Starbucks is providing consumers with an interpretation of where to drink coffee, when to drink coffee and how to drink coffee. The consumption appeals of Nestle and Starbucks are also quite different: one is to pursue "I am drinking coffee", and the latter's demand lies in "I am enjoying a comfortable lifestyle of payment"; the former is more sensitive to price, while the latter cares more about the experience and value of consumption.

To be more precise, the "Starbucks" brand is fundamentally not compatible with the traditional instant coffee represented by Nestle. In the eyes of Starbucks's loyal consumers, traditional instant coffee represents relatively inferior coffee beans, which lose their natural aroma and coffee flavor because of the intense baking process. Before the release, Starbucks was even entangled in whether to classify Via in the category of instant coffee, which is opposite to Starbucks's high-end positioning.

So in fact, what Via is basically developing is a completely new market. What it needs to do is to counter the consumers who have stereotyped bias towards instant coffee. "Instant coffee also has high quality". It needs to undergo a process of nurturing people who don't drink instant coffee in the past. So the main group it aims at is still a consumer of high quality coffee, just changing the way - no longer experiencing in the "third space" created by cafes, but providing a new consumption experience of easy to buy, Yi Chong and easy to carry high-quality coffee, whether at home, on the road or in mountaineering. This echoes the idea of "everywhere, everywhere," conveyed by Italian Italian Via street.

The value that Via can provide should be based on the re development of Starbucks's nurtured market. At the beginning of the release, Via will be sold in stores. Consumers usually buy a few bags after the coffee shop to try. Therefore, their buying behavior is in recognition of the extended behavior of products, services and experience provided by Starbucks. Moreover, almost all of Via's marketing programs emphasize "providing the same quality taste as fresh coffee", so the premise is that people have already experienced fresh coffee and have identified their quality. Therefore, the sales volume of Via in mainland China also depends on the situation of a series of high-end coffee brands such as Starbucks entering and consumer enlightenment. Its mainstream consumer groups are also difficult to split from the long term loyalty consumers of Nestle and other brands.

Of course, with Starbucks's strong brand influence, many consumers like Nestle and Maxwell will also upgrade to become trial consumers of Via, but prices will play a role in regulating leverage. The average price of Via is about 9 yuan per packet, which is almost 10 times the unit price of Nestle products. For consumers who have been accustomed to the coffee experience of Nestle for a long time, the price of Via has become a considerable barrier, and its consumption habits are hard to change.

Having said that, the launch of Via will surely give Starbucks a severe challenge. Although statistics from SymphonyIRI, a retail and consumer goods consultancy, show that Via sales in the us reach $100 million after 10 months of listing, while only 0.3% of the products in the United States sell more than 100 million yuan in the first year, but most of the performance comes from sales in their stores. The challenges that Via will face is not only the innovation of a traditional concept and consumption mode, but also all the pressures from global production and distribution, channels and logistics.

In fact, Starbucks has been stationed outside the store more than ten years ago: Marriott, Hyatt and other star rated hotels will provide Starbucks coffee for guests, and Barnes & Noble bookstores and other supermarkets in the United States and many other supermarket chains in the United States also have Starbucks's independent selling point. When McDonald's makes use of its convenient mode of operation and low price to launch the chain of wheat and coffee in the whole world, Starbucks also began to launch its own brand Seattle Seattle s Best Coffee in Subway, Burger King, AMC theater and so on. But compared with these independent channels of cooperation, Via will be snatching with nestle in supermarkets, convenience stores and other channels, which are always the strong outlets for Nestle to shake its position. Nestle soon launched a new round of marketing of milk flavour instant coffee varieties in Via, so it is easy to see that Nestle is ready to color some new people.

In addition to the pressure from Nestle's channel, at the end of last year, Starbucks and its long-time partners, kraft and Pepsi, ended their dealership in the super channel, and all the distribution rights were retracted. The Kraft and Pepsi that were grudges in the rescission process will also bring pressure to Starbucks's channel development. As a leader in fast fading brands, Kaf and PepsiCo have used their strong distribution capabilities and resources to sell Starbucks products such as star ice cream and ice cream, and extract 15-20% sales profits from them. Nowadays it is hard to imagine whether they will be able to squeeze Starbucks's survival space with other brands. This is a question waiting for time to answer.