The Keurig Machine

Green Mountain Coffee Roaster’s Keurig Single Brew system is dominating the U.S. market with an overwhelming market share. Analysts expect sales of single-cup brewing systems to continue to grow in the U.S. and competitors are eyeing a piece of the pie. An analysis of Keurig’s current position, based on Michael E. Porters 5-Forces, highlights a number of key areas of opportunity and risk for the company. Handled correctly, the Keurig product line should continue its growth, however, a number of significant pitfalls threaten its dominance.

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).

In that area, the household is the sale peak, which means, every households needs a coffee machine to improve life quality. The housewives will purchase a coffee machine which can be more efficiency to support every needs. As American life style, coffee is essential for every morning and if the coffee can be made in house not outside purchase, housewives will not go out for coffee. It will decrease the time which spend on purchase everyday needs. Considering the general workers and employees will needs coffee more than child and elders, Nespresso will sale for the people which have basic demand for coffee which means every workers and employees will purchase a coffee machine in the house or workplace. Therefore, the age of target customer is 15 to 64 years old. According to the market investigate, the population volume in that age is above 200 billions and it still have positive increase trend in 2012. Considering the professional Nespresso machine is not the basic needs that everyone can afford; however, the commercial Nespresso machine is not that expensive for general workers; consequently, the commercial one will be more useful and has more competitive

As a shopping product, we can expect considerable planning time involved – as it could be considered a “big ticket item” when compared to the everyday coffee brewer, however with price being part of the marketing mix, we plan to price it competitively with its sister-like products, taking in its additional conveniences and manufacturing costs into pricing and revenue management. Introductory cost projections are in the $220-$250 range. With our image already defined in the small electronics industry, we plan to market heavily on the already in-place reputation.

Don't you just love filling your cup up each morning with hot coffee or tea? I am a hot green tea gal myself. I love the fact that with a touch of the Keurig button my cup is filled. Wouldn't it be great if throughout our busy day we could mentally refuel by the the touch of a button? This would allow us to keep on the path of a loving, positive and learner mindset instead of drifting into the lane of negativity, self-doubt, and judging. Sadly, the Keurig button can't fill us up, but the goal would be to find a daily practice that can become that button.

Although the company is known for their coffee, they also drive a great portion of their revenue from baked good sales, which differs greatly from the Keurig Green Mountain strategy. Dunkin does compete against Dunkin intensely in the New England market, as both companies were founded and based in the area.

Keurig should insist on their plan to launch the new Keurig-Cup even if the GMCR holds the opposite view since it can protect the profits of KAD and roasters when new products are introduced to the market. If Keurig differentiates the at-home market from office market, the previous office brewer users could not go to the direct commercial channel to purchase K-Cups at a lower price (if the at-home used Cups is cheaper). It won’t cause the customer loss of OCS

The Keurig coffee brewer is the leader in the retail market for single serves coffee brewers but it can do better. Keurig has been slowly losing some of its share of the retail market in recent years. In 2011 Keurig controlled 54 percent of the market which is down from its 2010 number of 60 percent and 2009 number of 63 percent (Geller). Keurig needs to take its product and it has to offer and enter into new markets and segments. It mainly needs to focus on the younger and lower income level of its

Keurig begins working on a line of teas (T-Cups); the first line is to be “Celestial

Green Mountain Coffee Roasters, Inc. (GMCR) was founded in 1981 as a small café and combined with Keurig in 2006 (About GMCR, 2004-2009). GMCR produces specialty coffee and coffee makers; Keurig is the maker of a single cup coffee maker as well as specialty teas and coffees. Keurig was founded in 1998 on the concept that one should be able to make coffee one cup at a time rather than one pot at a time (Coffee.org, unknown). Today, GMCR has acquired and merged with several specialty coffee brewers and Keurig

This skill is beneficial for students because it allows for them to be independent but also learn how to do a task that may be applicable in a workplace setting or around the home. In our society, coffee consumption has become a staple of everyday life. According to the Harvard School of Public Health, 54% of Americans over the age of 18 consume coffee. In addition, many businesses provide clients or employees with coffee and some might implement the Keurig coffee machine. This skill is not only implementing fine motor skills of placing the K-cup in the machine, but also is more complex than one might think, due to the variation of how people drink/enjoy their coffee. For example, some people like cream or milk in their coffee and others like

Keurig, Inc. was founded on “excellence”, which is the Dutch meaning of its name, and the innovative principle of allowing consumers to be able to make a single excellent cup of coffee whenever they wanted it at home or work with their K-cup single cup brewing system. The Keurig system was such a hit in offices that the company knew the next step was to position themselves to sell units to individuals for use in their homes. At home coffee brewers were always faced with two things loose coffee grounds to clean up and coffee that never quite tasted right. The Keurig system would eliminate both of those issues for the

Keurig in Dutch means excellence. It is the leading single cup brewing system in North America.

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.

It is essential that Green Mountain’s negotiation succeed because the value proposition that comes along a new product like the portion pack system. Keurig is a start up coming looking to expand its business venture and GMCR central location is in the Northeast and they were also looking to expand the company’s geographic existence. With expansion ideas in mind as a common ground for both companies, it would be smart and beneficial for the companies to work towards this specific goal. Keurig would make it feasible for GMCR to sell the K-cups it will eventually produce in parts of the country they are not already connected to once the Keurig goes national. There is major room for them to grow and to be