The Homa Files

TakeAway: Starbucks is betting on their multiple locations and recent acquisition of a juice making company to become player in the CPG industry.

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Excerpt from WSJ: “Latest Starbucks Concoction: Juice”

Starbucks Corp. is buying a small, upscale juice maker Evolution Fresh — a deal that shows how serious the company is about transforming itself into a consumer products player.

Many packaged-food and beverage manufacturers have struggled to boost profit margins amid high marketing and commodities costs, and some brands have been pushed off store shelves entirely.

Starbucks’s business model will help it succeed where others have failed, because it can test new products in its stores before introducing them to supermarkets.

Starbucks also may not have to spend as much money on traditional marketing and customer acquisition as other food manufacturers, since it can use its stores as advertisements.

Getting a product in front of the 60 million customers who frequent Starbucks stores around the world each week is equivalent to airing a commercial on the top three television shows weekly.

Edit by ARK

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Tags: orange juice, Starbucks

This entry was posted on December 16, 2011 at 6:12 am and is filed under Beverages - Soft Drinks, Retailing. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.