Starbucks' new Via instant coffee: Don't believe the hype

I took my little boys to Starbucks (SBUX) this morning to witness the hype about its new instant coffee, Via, and we had plenty to see.

A near-life size silhouette of a woman holding a packet of the company's new instant coffee greeted me on the door. A large, three-dimensional display took up most of the space opposite the counter where new products are usually placed, packed to the gills with Via packs, three for $2.95 or 12 for $9.95. The display featured more silhouettes, a man and a woman, both showing off their hipness and their Via (and yes, the figures are very evocative of iPod ads). The woman was holding Starbucks' new Via to go mug; it has plastic compartments for six packets of the instant coffee around the perimeter of the coffee cup, and a screw-off bottom. There was another display of three-pack Via envelopes to the right of the register, and still another display above the Starbucks cards in front of the register. A cardboard sign listed all the places where I could drink Via -- the "usage occasions," says Starbucks Director of Digital Media, Alex Wheeler -- picnic lunch, at the game, in the backyard, on a train, redeye flight, on the mountain, business trip, at the library (really? the library?).
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Starbucks in the News
Howard Schultz, CEO of Starbucks Coffee Company, discusses Starbucks Via instant coffee, Tuesday, Sept. 29, 2009 in New York. Click through the gallery for the latest news about Starbucks.
AP
AP


And the barista handed me two free packets as soon as I placed my order. I'd already tasted the coffee during the product's preview launch in February, and found it middlin' -- not objectionable, as I find the ordinary brands of instant coffee, but not as good as brewed coffee. I brought some home to my brother-in-law, a frequent coffee drinker who has Starbucks brand loyalty, and he agreed. It was better than Folger's, he said. It wasn't as good as the cup of brewed coffee I'd brought back for him.

This is, says Starbucks PR representative Lara Wyss, the company's biggest-ever product launch. I spoke to Wheeler, Wyss and a representative from Edelman, the company's agency, this afternoon, and the excitement in the New York conference room to which I was connected was palpable. Like Christmas, said one of the two women. A "very big opportunity," said CEO Howard Schultz on a journalist conference call this morning. "You can't taste the difference," says the rare Starbucks TV commercial debuting today, nor can nurses, yellow belts, people who look like their pets, or people who yell in town hall meetings. "I tasted a coffee white russian made with [Via] and it was out of this world," says friend and food writer Jennifer Perillo.

Media reports ask, is this going to be a breakthrough? A home run? It's obvious that is what Schultz and his team of eager marketers are hoping.

I've written before that for a company which has built its brand image around the community and warmth of a coffeehouse, the "third place," launching instant coffee really doesn't make sense. I'm certainly not the only one to have made that analysis. John Bencina, commenting at the Wall Street Journal, wrote "In his own book, Schultz wrote about the need to replace instant coffee in homes and restaurants across America with a more authentic brew. Fast forward 20-30 years later and Starbucks is selling the very same product it sought to replace." Another commenter wrote that he doubted the company could have it both ways, to "tell consumers to pay more for Starbucks coffee in its stores because it is "premium" while on the other side tell consumers that they can have just as good of an experience with instant coffee?" It would never pass muster in a marketing strategy class.

I asked the Starbucks marketing reps how this worked: can an instant coffee and its associated social media strategy really be successful? How does its coffeehouse image translate into mobile apps, flickr groups and "redeye flight, on the mountain, at the game" "usage occasions"? Wheeler gushed in response, saying that "customers have given us permission to provide that experience outside of the store," pointing to the overwhelming majority of packaged beans sold outside of Starbucks-owned locations (grocery stores, mostly) and the 4.1 million Facebook fans and 300,883 (at this writing) Twitter followers. She said she was "honored" to be head of of digital media for this brand, sure that "there's no brand that's more well-suited for a social media strategy than Starbucks."

In the test markets -- Chicago, Seattle, and 32 stores in West London -- Starbucks said its Via launch exceeded expectations. It was popular with nurses and doctors, firemen and police officers, "teachers who have had coffee removed due to budget cuts," photographers, hikers and bikers. Anyone with "inconsistent hours" or who is on the go. Starbucks employees, who, despite having always-on access to Starbucks brewed coffee and espresso machines, might not have time to wait four minutes to brew a fresh pot when running to meetings. "I just whip out a stick of Via and get on to my meeting," says Wyss. On Twitter and in blog comments, parents and supercharged professionals say they'd love to have Via for occasions when they need to stay awake and don't have time for brewing.

And what about the money? Isn't $1 per eight-ounce cup (four ounces less than a "tall" coffee), at about 12 times the retail price per serving of most instant coffees, a reach in this economic climate? "The way we look at it, it's a great value," says Wyss. "We have had no negative feedback from our customers," says Williams.

Well, there is negative feedback on the Web, and most importantly from baristas commenting at StarbucksGossip.com. Many of them think that half the price would be more sensible, especially in the face of its pre-launch hype as being focused on value (no, this is no value, no matter how you run the numbers).

Despite much excitement and social media buzz of the campaign, I'm still convinced this launch is going down the road that Starbucks should not be traveling. What I am seeing in the sort of people who frequent coffeehouses is not a desire to get on a redeye and bring along a better coffee than the airline is brewing (a goal, by the way, I can't knock for its truth and logic -- airline coffee is terrible). The future of American coffee drinkers -- and, in many ways, the general direction Starbucks has been heading -- is this: a commitment to slowing down, eating "real food," paying more attention to how coffee beans have been grown and how they're traded. Desiring less packaging, and looking for more environmental consciousness with what's used. Post-consumer recycled paper; no chlorine bleach; plant-based dyes. Composting bins and encouragement to use them. Far, far less processing before food and drinks get to one's lips. A priority placed on fair treatment of farmers, workers, middlemen. More knowledge about everything.

Via is none of this. It's orange and bright red, packaging swarming all over coffee, manufactured in a mysterious and secretive process. There is no single origin here; no, it's "Italian Roast" and "Colombia," flavors with no associated promise as to where the coffee was grown. Plastic, plastic, plastic. And the price is bewildering, not even a value compared with the company's best and most fairly-traded beans.

Yes, there's a bit of a buzz. In a year or two, I believe, that buzz will be gone, replaced with a sober realization that this was 20 years of research and product development that should have stayed in the 1980s where it belonged.

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