Coffee Titans crashes for espresso-centric market

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Two little allied US coffee giants, Starbucks and Green Mountain Coffee Roasters, have started teasing each other about who can project dominance in the emerging domestic espresso market in North America. In grieving press releases, the CEOs of both giants publicly leveled their espresso-focused ambitions on March 9, 2012.

On that date, Seattle, WA-based Starbucks revealed its plans for a new home brewing system called Verismo, scheduled to debut this fall. This new machine focuses on the production of espresso, rather than a traditional American beverage popularized by the Keurig k cup system. Green Mountain owns Keurig and Starbucks has its own stake in k glasses sold using the Keurig system. Patents on the k cup technology expire at the end of this year, leading to a reorganization by market players.

While there is still a sense of collaboration on the k cup platform, the relationship between the two allies may have been strained by the recent market launch of the new Keurig Vue brewing system which is incompatible with type k capsules. This change from Green Mountain has opened a window for Starbucks to take the first step towards a new express lawn. Some potential vulnerabilities in the new Keurig Vue system include an increase in the price of the machine to $ 250, up from around $ 150 for previous models, and the unit cost of the Vue capsule to $ 0.75 vs. around $ 0. , 40 for a k cup.

For many years, American consumers have looked to espresso-based coffee makers for homemade coffees. One of the main obstacles for buyers when choosing espresso machines was their listing price well above $ 300. However, recent price drops have brought the cost of the domestic espresso machine close to the level of the Vue system. Starbucks sees the same price for Verismo and is now vying to lead the fledgling US espresso market.

Eager to defend its dominant position in the single-cup business on the very day of Verismo’s pronouncement, Waterbury, VT-based Green Mountain immediately fueled speculation of coming out with its own appearance of an espresso machine that it uses. Lavazza espresso capsules. Its public statement did not convey the timing for the rollout and product details.

Neither of the two open fighting groups has offered details of their respective espresso machine design. These overt claims suggest that both products are still in the development phase. Of course, either side also wants to keep trade and design secrets close at hand.

Meanwhile, global food giant Nestlé showcased its Nespresso Zenius, which uses a proprietary espresso disc, at a recent New York trade show. Interestingly, its market focus is on the hospitality industry, where its machines are placed in luxurious hotel suites for room service.

Positioning yourself above the evolving domestic espresso market in the US can be vital for every coffee giant. Consumer reviews recently released by Mintel, a global market intelligence provider, show a growing preference for individual servings available in espresso capsules by a 55% margin. Another 35% of those surveyed noted that capsule-type machines produced a consistent flavor every time.

It can be argued that single-cup consumers will adopt the espresso brewing process rather than regular coffee brewed with k and Vue type servings. Europeans, especially Italians, know that a high-pressure pump and optimal temperature control are required to extract the best oils from coffee. This culture is determined by seeing a top layer of golden cream, or creamy foam, which attests to a good extraction of coffee nectar. Keurig devices often use low pressure media, which can result in less complete oil extraction.

While the US coffee goliats grapple in speculative terms about who can move into the home espresso sector first, HealthCafe, whose relative stature is that of a “david” in home-based espresso solutions. Northern New Jersey has a head start. Their sales reps are asking retailers nationwide to get the miniBarista S-1600 Espresso / Cappuccino Capsule System ready for prompt distribution.

HealthCafe has chosen the capsule format in the making of a cup for many reasons. One is its inherent ability to filter an LDL cholesterol inducer called cafestol from the beverage. Another is that the freshness of the coffee is preserved longer with the displacement of nitrogen. Most importantly for consumers, the capsule follows the ESE industry standard that a multitude of coffee capsule manufacturers and capsule machines adhere to. Capsules, on the other hand, have little cross-compatibility, none are known to have a displaced nitrogen packaging, and none of this class is effective in blocking cafestol.

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