Seattle’s Best Coffee Kiosks
As its flagship cafés strive for an indie aesthetic, Starbuck Corp’s subsidiary will strike a different pose this summer. The company relegated its mid-market counterpart to the form of a vending machine in a five-year agreement with Coinstar, Inc. that will exclusively place Seattle’s Best Coffee in hundreds of kiosks across the United States. The price for an auto-dispensed cup of joe? One dollar.
The move is one of many from the world’s largest coffee company’s recent initiatives to drive sales, joining a re-design of select Starbucks cafés to serve wine and beer, a ski-thru Starbucks, and a plan to purchase the San Francisco bakery chain La Boulange. Unlike the ritzy updates to its gourmet coffee chain, the kiosks seem poised to pose a direct threat to competitors like McDonald’s who already have a dollar-priced brew on the menu. Executives hope the agreement will also help its effort to re-brand Seattle’s Best, especially after the company lost the biggest retailer of its coffee products–Borders–to bankruptcy.
“This is the next evolution of the strategy we’ve been talking about,” Jim McDermet, Seattle’s Best senior vice president and general manager, told Fox Business. “We want to ensure that our coffee is being sold in ways that are more approachable, accessible, and affordable. That’s where Coinstar fits in.”
Under the agreement, Seattle’s Best cannot sell its coffee from its own vending machines, and Coinstar cannot offer any other coffee product in its kiosks, which the companies named Rubi. Rubi will be what Fox Business calls “the most advanced” of its latest forays outside of coin-counting and Red Box DVD machines and is a maneuver that has Investors Business Daily questioning whether or not the company “aims to be the Amazon of kiosks.”
McDermet believes Rubi will help usher a new consumption model into the U.S.
“The U.S. has lagged other parts of the world in automated retail, and we are at the forefront of this trend coming to the U.S.,” he told Fox Business. “We believe that there is certainly an international opportunity as well, though it’s not part of this deal.”
By the end of the summer, Starbucks and Coinstar plan to have 500 Rubi kiosks brewing in grocery stores, drug stores, and other mass retailers. At first, Rubi will offer seven drinks in one size (lattes and other café-esque drinks will cost 50 cents extra, says MSN Money). Coinstar Chief Executive Paul Davis, the former North American president of Starbucks, told Fox Business he and other investors are exploring the possibility of adding seasonal flavors when more kiosks open with the potential for iced lattes on the horizon. A loyalty program with perks for frequent customers is also in the works.
So far, 50 Rubi kiosks are open for business. Expect one in your friendly neighborhood drugstore soon.
Photo from Self Service World