Tuesday, August 26, 2008

Starbucks is Changing the World, One Cup at a Time

Starbucks announced they are test marketing a new premium coffee, brewed using a machine that cranks out one cup at a time. The machine, known as "The Clover," enables baristas to select a specific time and temperature based on the characteristics of the coffee bean being brewed. The process is designed to extract the most possible flavor from the beans.

According to David Latourell of Starbucks,
"Vacuum-press technology pulls the coffee through a 70-micron filter in which every hole is like a hair's breadth."
Sounds delicious...I love when "hair" is used when describing beverages.

Starbucks is feeling the heat from competitors, with quality coffee now readily available at McDonald's, Dunkin' Donuts, and your local convenience stores. Their response seems to be...you think you can make premium coffee? Well...we're going to make super premium coffee.

Will Dunkin' Donuts retaliate with wicked premium coffee? Come on now...we're not selling razor blades here. This is not the Gillette-Schick battle to see how many blades they can fit onto a handle.

I question whether the average consumers' palate will really be able to discern the difference in quality with this magical Clover machine. Even if the coffee is noticeably better, will you be willing to pay more and wait longer? Prices are expected to be about 40% higher for Clover-brewed coffees, and they will take about a minute to brew (not exactly well suited for the morning commute crowd).

The Clover debuts at select locations in Boston, Seattle, and San Francisco in early September. The timing isn't exactly ideal with Americans trying to save pennies here and there to pay their mortgages and fuel their cars.

But what do I know? Maybe The Clover will blow your mind. Let me know how it tastes. I'll be sipping a cup of Dunkin' Donuts and beating the traffic while you wait in line.


Jay Ehret said...

Andy, I actually think this is the best brand reinforcement Starbucks has introduced in quite a while. The Clover goes back to what the Starbucks brand is all about: a coffee experience.

For a while Starbucks has been positioning themselves as a beverage convenience store. Get your smoothie, get in, get out. In my opinion that is too much like McDonald's.

What people originally really loved about Starbucks was the experience. Part of that experience was the premium coffee. People will pay more if you give them a reason to pay more. I can't wait until the Clover arrives in my town. It will be worth the extra 60 cents to me.

Andy said...


I think you are right that Starbucks needs to focus on the in-store experience if they want to differentiate themselves from their quick serve competitors.

But, I just don't know if The Clover is the answer. Will the experience be enhanced with a congested waiting area and impatient customers? I have major concerns about the operational impact of this machine. Think double the number of customers waiting by the barista stand.

I would like to see Starbucks do more with the entertainment leg of their business. There are lots of ways they can bring that content into the stores beyond simply selling CDs at the counter.

By the way, I have located a Clover nearby my home. I'll be checking it out.

Jay Ehret said...

Andy, you bring up a valid issue on the wait times and how Starbucks will handle them. Looking forward to hearing about your Clover experience.