Back to top

Analyst Blog

Starbucks Corporation (SBUX - Analyst Report), and Inventure Foods, Inc. (SNAK - Snapshot Report) teamed up recently to launch the first blend-at-home frozen coffee in springtime this year. Seattle’s Best Coffee Frozen Coffee Blends, made from high quality arabica coffee beans, will come in four flavors Coffee Chiller, Creamy Caramel, Very Vanilla and Mega Mocha.

The demand for blended coffee drinks has been increasing. The introduction of Seattle’s Best Coffee Frozen Coffee Blends is meant to capitalize on the booming demand for blended coffee.

The new product is expected to gain popularity with consumers as it offers the convenience of making blended coffee anytime. Also, the new product is healthy as it contains zero trans fat, nine grams of sugar, and only 130 calories per serving.  

Consumer product companies necessarily need to upgrade brands and create differentiated value propositions for customers in order to cater to the changing demand of the consumers. Starbucks focuses on product innovation as one of its profit driving strategies. Starbucks is strengthening its product portfolio with significant innovation in at-home coffee, refreshment, health and wellness, and tea and enhancing its core food offerings.  

For instance, in the fourth quarter of fiscal 2012, Starbucks launched its much-awaited premium single cup domestic coffee machine, Verismo. The Verismo at-home machine, together with the already popular VIA Ready Brew and K-Cup portion packs, is expected to significantly expand Starbucks’ presence in the fast growing premium single cup coffee segment.

Starbucks carries a Zacks Rank #3 (Hold).

Other companies in the sector like Krispy Kreme Doughnuts, Inc. (KKD - Snapshot Report)  and Red Robin Gourmet Burgers Inc. (RRGB - Analyst Report) both with a Zacks Rank #1 (Strong Buy) are currently doing well and are worth considering.