Marketing Final Project Team 1
Ryan Marshall, Manuela Antonova, and Joshua Booth
Mr. Coffee Smart Optimal Brew WeMo Enabled Marketing Plan
Executive Summary
A recent primary research survey has found that 70% of occasional coffee drinkers view the Mr. Coffee brand as an inferior or budget coffee brewing device that does not make a superior cup of coffee (Appendix, Opinion survey). Brands such as Keurig, Cuisinart, and DeLonghi inspire more thoughts of quality coffee than Mr. Coffee. Other consumers are opting to spend several dollars per cup of coffee at coffee houses such as Starbucks, Caribou Coffee, Dunkin Donuts, and even McDonalds (Appendix, Opinion survey).
Mr. Coffee is a part of American iconography appearing in movies,
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Coffee, Inc. History, 2014).
This marketing plan will show that the solution to Mr. Coffee’s problem is show that the features and technological improvements, specifically the Wi-Fi option, thermal carafe, and optimal brew temperature feature create a good value and great cup of coffee. The plan will rely heavily on channel and image differentiation. This device will be easier to get than pricey Italian entries and the Mr. Coffee brand will be shown to reestablish brand affinity by keying into pop culture references.
Table of Contents
1. The Firm 2. Marketing Environment 3. Brand and Product 4. Competitive Analysis 5. Target Market 6. Positioning 7. Price Strategy and Pricing Decisions 8. Channels of Distribution 9. Integrated Marketing Communications 10. E-Commerce 11. Corporate Social Responsibility 12. Budget Allocation 13. Appendix
The Firm
Mr. Coffee is best known for pioneering and leading the market in the automatic drip coffeemakers. The brand was established in 1968 by Vincent Marotta and Samuel Glazer and was then part of the North American Systems, Inc.
The owners came up with the idea for Mr. Coffee automatic coffeemaker in 1970 and their invention was an instant success. With sales of over one million units for the first 4 years, Mr. Coffee gained a market share of 10%. At this time the company was relying mainly on national TV commercials in
Jerry Baldwin, Gordon Bowker, and Zev Siegl founded Starbucks in 1971 in Pike Place Market in Seattle, Washington. They were inspired to pursue this company by coffee roasting entrepreneur Alfred Peet after he taught them his style of roasting beans. Since then, Starbucks has grown into the largest coffee chain in the world, with over 23,000 locations worldwide.
Sales from restaurants—including Starbucks, Dunkin' Donuts, and McDonald's, which carry premium brews—grew at a compound annual rate of 15.2% from 2001 to 2006, as supermarket sales rose only marginally. Activist investor Nelson Peltz is pressuring Kraft to divest slow-growing Maxwell House. But Kraft vows to stick with the $1 billion-a-year brand. Another worry: Only 37% of 18- to 24-year-olds drink coffee, reports the National Coffee Assn., vs. 60% of those 40 to 59 and 74% of folks over 60. (Crown, 2007)
Following the Boston Tea Party, Congress declares coffee the official national beverage (Wang 30); Americans were now the world’s leading coffee consumers, drinking 400 million cups daily. The first wholesale coffee roasting company in the United States was established in 1790 (Wang 30). This led to the first newspaper advertisement for coffee which appeared in the New York Daily Advertiser. The first decaffeinated coffee was introduced in 1903 (Wang 30). German coffee merchant Ludwig Roselius discovered that a shipment of coffee beans had been soaked in water and lost most of its caffeine, however it retained its flavor. Twenty years later he introduces it to the U.S., where it is still distributed today by Kraft Foods (Wang 31). Nestle introduced Nescafe in 1938, it was the first “drinkable” instant coffee. Achille Gaggia invented the modern espresso machine in 1946 (Wang 31). According to a 2011 Coffee Statistics Report, 30 million Americans drink speciality coffee beverages and espresso based drinks daily. Starbucks was a large contributor to coffee’s second wave in the early ‘90s and carrying it to the third, rebounding from the economic downturn with total net revenues up 9.5 percent to $10.7 billion.
One of the big reasons Ms. Kudler is so interested in adding gourmet coffee in her stores is because of the massive boom in coffee over the past twenty years. Coffee has gone from a cheap product sold in Styrofoam for twenty five cents to a coffee and espresso mixed in different combinations with sugar and cream sold in fancy cups for over three dollars a cup. So as Ms. Kudler joins the ever growing market she is clear that she is competing with other giants in the coffee industry. Primarily she will be dealing with Starbucks, Starbucks is the coffee industry, and currently they are in many grocery stores and strip malls everywhere. Starbucks is so popular people refer to getting a starbucks rather than getting a coffee. Ms. Kudler is aware Starbucks and there
By 2003, the number of retail specialty coffee shops, cafes, kiosks, coffee carts, and roasters in the United States reached over 17,000, equating to nearly $9 billion in sales. According to the Specialty Coffee Association of America, 16 percent of adults in the United States drink coffee from one of these specialty outlets daily. (“Organo Gold”, 2008).
When a small sign was hung on a little cafe in Waitsfield, Vermont in 1981, nobody would have imagined that Green Mountain Coffee Roasters [GMCR] would become one of the world's leading specialty coffee makers. Through hard work, "Demand quickly grew beyond the walls of the café," and many other local companies requested GMCR coffee to offer their customers (GMCR, Company Overview, 2009, p. 1). Today, GMCR "is recognized as a leader in the specialty coffee industry for its award-winning coffees, innovative brewing technology and socially
20 million Americans drank gourmet coffee daily in 2003. As a result of this amount of coffee lovers that can’t start their day without coffee, Keurig. Inc had the idea that they should be able to brew their own perfect cup of coffee any time they need. People started paying $1.50 or more for a cup of gourmet coffee at coffee shops like Starbucks. This gave Keurig. Inc the idea of offering coffees in a single-cup proportion size to offices. After the placement of Keurig brewers, gourmet coffee sales increased by 40% in the U.S at-home coffee market. According to that big percent Keurig management wanted to develop an at-home single cup coffee brewer for coffee lovers. Keurig Inc. targets customers
Coffee has been around the market and homes for a very long time now. The first coffee shop in the United States opened in 1697 in New York. Today, nearly two-thirds of americans drink coffee. Coffee is usually associated with 'waking up ' or 'staying awake ' due to your high caffeine level, and it 's invevitable to these two coffee chains be overcrowded during the rush hours in the morning. Coffee shops are always trying to innovate with different coffee flavor or mixtures to make them standout more than the other competitors. Starbucks and Dunkin '
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.
In 1990, John Sylvan and Peter Dragone entered the coffee brewing industry by launching their company Keurig built upon on the question of, “why do we brew coffee by the pot when we only drink it by the cup?” Within a few years after their start-up, they were able to secure multiple patents as well as acquiring $1 million from venture capitalists to improve upon their prototype. By 1998, Keurig, which is German for excellence, was finally able to launch their first industrial strength, single-serve machine delivering a perfect cup of coffee every time. Keurig was lucky to join the coffee market at the dawn of its explosion, when consumers’ wants and needs began to shy away from
Your Favorite Cup’s mission is to provide great coffee in a laid back comfortable atmosphere. We want our coffee shops to be more than just a place to get great coffee. We want you to
When it comes to capsule coffee machines, the top two competitors of Nespresso are Keurig and Starbucks Verismo. As reported by A National Coffee Association, “the number of American households that own single-serve coffee machines has gone up”; since they provide many great benefits such as ease of use, time -saving, low maintenances, or automatic turn-off after use (Shah, 2015). As a result, various companies start entering into this fast-growing coffee market by offering many machines different in designs and quality features to target this trend’s consumers.
Keurig Inc has been founded on an amazing idea that coffee making systems that uses individual portion packs of freshly roasted and ground coffee with unique coffee maker designed to brew perfect cup of coffee at a time. At that time there are already established gourmet coffee houses like Starbucks, which is making coffee consumers to spend more money with an average of $ 1.50 or more for a cup of gourmet coffee. This change is consumer behavior created opportunity to Keurig to offer gourmet coffees by a single-cup in offices in 1998. Within a span of four years (1996-2000), Keurig have noticed sales increased by 40% in US at home coffee market. With these facts Keurig´s management got convinced, to develop an at home one-cup coffee brewer especially for gourmet coffee lovers.
Just like American’s the British love their coffee. In fact coffee is the most popular drink worldwide.According to the National British Coffee association, the café culture is rising in popularity with 80% of people who go to coffee shops doing so at least once a week. According to the Short List, a popular UK magazine, you can not even walk four strides without coming to a new coffee shop. Daily Mail, a popular online newspaper, states that coffee is quickly gaining popularity even over the nations iconic drink, hot tea. Due to the rising popularity of chain coffee shops, the nation is drinking almost two and a half cup of coffee for ever one cup of tea. The market is also being dominated with the sales of specialty drinks. For these reason, it is not surprising that coffee retailers are flourishing.
Our founder from Seattle was inspired by Hong Kong’s entrepreneurial spirit. He set out to make Pacific Coffee a community hub known for its informality and friendly attitude. Since the opening of its first coffeehouse in 1992, Pacific Coffee has provided world-class coffee to satisfy Hong Kong's growing demand for specialty coffee beverages, and served as a urban oasis for customers wishing to have a moment of peace in their busy, hectic life.