Tuesday, March 3, 2015

Grocery Aisles Stocked with Chain Restaurant Coffee

The evolving Omni-channel retail food world has created a new platform for chain restaurant branded exposure.  Chain restaurant bagged ground coffee, bagged whole bean coffee or K-Cups can be found in most grocery aisles today.

McDonald’s, Starbucks, and Dunkin brands coffee are expanding the reach of each brand while generating income to fuel additional sales, marketing, and success.  Soon you can add Dunkin’ Donuts K-Cups to your grocery list. Customers have been able to have been able to buy Dunkin’s single-serve coffee made for the Keurig brewing system only at the brand’s restaurants since 2011.  This summer, K-Cups will appear on the shelves of grocery stores next to McDonald’s and Starbucks offerings. 

Nigel Travis, chief executive of Dunkin’ Brands Group stated; “Instead of making this available on a limited basis, the widespread distribution will only help that brand relevance.” “The franchisees were delighted with the idea of a new revenue stream and worried about potential cannibalization,” Travis said. 

Pumping profit into the system Travis estimated that each restaurant will receive $2,500 to $3,000 a year for the first five years of the program. As part of the agreement, franchisees also will split the profits on packaged coffee, up from one-third of the profits under a previous deal. 

Kraft is helping McDonald’s rollout retail coffee.  For Kraft the stakes are huge: McCafe represents the company's largest new product launch ever, says Adam Butler, marketing director of McCafe. Executives project that the first-year sales of McCafe bagged coffees will exceed the $100 million that Kraft's MiO liquid beverage mix amassed its first year.

According to Barclays analyst Jeffrey Bernstein,  the K-Cup market is expected to grow by $5 billion next year.  “Starbucks currently has about 15 percent share, and we believe it reasonable to assume Dunkin’ will be able to achieve half that,” Bernstein added.

In our Omni-channel retail world brand relevance can expand or contract depending on customer migration, channel relevance and brand placement.  Where do your customers shop?  What are you selling and where?  Is your brand expanding? Looking for new revenue streams? Omni-Channel retail can drive new revenue. 

www.FoodserviceSolutions.us since 1991 is a global retail food consultancy based in Tacoma, WA has been the global leader in the Grocerant Niche, Mix and Match Meal Component Bundling Ideations.  Follow us at: http://www.linkedin.com/in/grocerant, twitter.com/grocerant or Facebook Steven Johnson Contact: Steve@FoodserviceSolutions.us

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