WHAT MAKES THE STRUCTURE IN COFFEE BREWING INDUSTRY CHANGING?
1. Expansion/Growth
Domestic and international expansion makes coffee brewing industry to grow tremendously. The key channel of distribution in this industry is “company-operated stores located in high-traffic, high visibility centers,” and industry competition is structured around vying for market share by opening new retail shops in cities around the world. Starbucks, for example, opens on average three stores a day and has already made significant inroads into countries like Japan, the UK, Australia, the Middle East and Latin America.
2. Product/Service Innovation
Product innovation also leads to such changes. Serious coffee shop contenders now offer a product selection broader than the traditional cup of coffee. National chain and even local coffee shops boast menus including coffees, teas, hot chocolate, pastries, bottled water, and even sandwiches. A factor that contributed to Starbucks’ ability to surpass early coffee house entrants, such as Gloria Jeans, has been the company’s extensive R& D. For example the company has been able to sustain and grow its customer base by launching a new seasonal drink each year and also via its $400 million bottled drink business. Importantly, product innovation for Starbucks includes not only factors regarding customer acceptance but also the extent to which the product would fit into a store’s “ergonomic flow.”
Equally critical to the structure of the coffee industry has been the role of service innovation. An example of such innovation that has been hugely successful was the introduction of SVCs – store value cards. Starbucks Coffee and Peet’s Coffee now offer customers pre-paid cards which not only shorten transaction times for customers but can also bring in new customers via gift cards and supply stores with valuable customer data. Schultz, CEO of Starbucks, has called this innovation “the most significant product innovation since Frappuccino. “Service innovation is also impacting the industry in that companies are now required to offer a diverse set of services including music, drive-through services and newspapers to stay competitive.
3 Collaboration/Partnership
Collaboration and partnership is another driver that ties into the industry’s focus on growth. Starbucks was the first to realize the benefits of partnering when it reached out to powerhouse brands like Pepsi, Barnes and Noble, Nordstrom, Kraft and United Airlines to create new products, reach new customers and enter new channels of distribution like grocery, cruise lines and the airline industry. These alliances, in short, allow for innovation, channel extension
and even geographic extension (in the case of Starbucks’ alliance with Japanese retailer Sazaby.)
1. Expansion/Growth
Domestic and international expansion makes coffee brewing industry to grow tremendously. The key channel of distribution in this industry is “company-operated stores located in high-traffic, high visibility centers,” and industry competition is structured around vying for market share by opening new retail shops in cities around the world. Starbucks, for example, opens on average three stores a day and has already made significant inroads into countries like Japan, the UK, Australia, the Middle East and Latin America.
2. Product/Service Innovation
Product innovation also leads to such changes. Serious coffee shop contenders now offer a product selection broader than the traditional cup of coffee. National chain and even local coffee shops boast menus including coffees, teas, hot chocolate, pastries, bottled water, and even sandwiches. A factor that contributed to Starbucks’ ability to surpass early coffee house entrants, such as Gloria Jeans, has been the company’s extensive R& D. For example the company has been able to sustain and grow its customer base by launching a new seasonal drink each year and also via its $400 million bottled drink business. Importantly, product innovation for Starbucks includes not only factors regarding customer acceptance but also the extent to which the product would fit into a store’s “ergonomic flow.”
Equally critical to the structure of the coffee industry has been the role of service innovation. An example of such innovation that has been hugely successful was the introduction of SVCs – store value cards. Starbucks Coffee and Peet’s Coffee now offer customers pre-paid cards which not only shorten transaction times for customers but can also bring in new customers via gift cards and supply stores with valuable customer data. Schultz, CEO of Starbucks, has called this innovation “the most significant product innovation since Frappuccino. “Service innovation is also impacting the industry in that companies are now required to offer a diverse set of services including music, drive-through services and newspapers to stay competitive.
3 Collaboration/Partnership
Collaboration and partnership is another driver that ties into the industry’s focus on growth. Starbucks was the first to realize the benefits of partnering when it reached out to powerhouse brands like Pepsi, Barnes and Noble, Nordstrom, Kraft and United Airlines to create new products, reach new customers and enter new channels of distribution like grocery, cruise lines and the airline industry. These alliances, in short, allow for innovation, channel extension
and even geographic extension (in the case of Starbucks’ alliance with Japanese retailer Sazaby.)
No hay comentarios:
Publicar un comentario