Starbucks' new Via instant coffee: Don't believe the hype
Filed under: Company News, Technology, Media, Starbucks
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.
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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.
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.



























Reader Comments (Page 1 of 11)
9-29-2009 @ 6:10PM
Melody said...
A surprisingly pessimistic view of Via in this article. I can agree the initial hype and buzz will wear off, but I think this product can have some real longevity. It does reach a need for a quick, convenient cup of coffee when there is no time to wait, and/or it's not sensible to brew a full pot of coffee. I suspect will have a loyal follower base for a long-time to come. Just as Cafe Estima coffee may only be popular to a subset of Starbucks Coffee drinkers, this product will likely enamor the interest of some subset, keeping it on the Starbucks shelves for a long while.
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9-30-2009 @ 3:27PM
snarkybigbyte said...
I detected the same thing too. The writer's viewpoint is overly critical to the point of being unbalanced. The enmity has a personal feel about it rather than just a well-reasoned, objective journalistic opinion. I'm not a fan of Starbucks -- I can count the number of visits in the last decade on one hand -- but attacking the company's efforts to expand and try something new in an attempt to fill a need for quality instant coffee seems both obnoxious and short-sighted.
9-30-2009 @ 3:55PM
susan smith said...
If you don't want to brew a whole pot of coffee, get a french press. There's just no excuse anymore for the tremendous waste of resources that instant coffee requires.
9-30-2009 @ 4:23PM
Marlene said...
I am a very loyal Starbucks consumer and wasn't very sure about this new product. However, since I am in hotel rooms 1/2 of the time and don't always have access to good coffee I thought I would give it a try and this is a large improvement over the coffee that you brew yourself each morning in a hotel room. Just run the water through the coffee pot, add the Via to the cup and then add the hot water. Better than the coffee on most airlines as well. While it is not as good as a fresh brewed cup of coffee there are times where this is very applicable.
9-30-2009 @ 10:23PM
judithkil said...
It seemed kind of weird to me to have to go into a Starbucks to get instant. If I bothered to drive to Starbucks I'd get it from a pot.
I can see having it in hotels/ on grocery store shelves, etc., but not to order at their coffeehouses.
Folger's has had instant coffee bags, like teabags, in stores for years now.
9-29-2009 @ 11:08PM
Shane said...
I don't care if it does taste as good as brewed coffee, the price is ridiculous. Even if it were priced at half it is still overpriced for instant coffee-any coffee for that matter. Starbucks is on crack.
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9-30-2009 @ 3:09PM
Vicki said...
U obviously do not go to Starbucks if you think 3 cups of Starbucks for $2.95 is expensive. It is a cheaper alternative for Starbucks junkies.
9-30-2009 @ 2:59PM
kevin said...
its less then a dollar per stick of instant coffee. if you think about it, its relatively cheaper than starbucks brewed and a lot of coffee out there.
9-30-2009 @ 3:32PM
Heather said...
Its actually not expensive. A normal 8oz short cup of coffee is 1.30. So, if you buy a 3pack its costing you less than $3 dollars for 3- 8oz cups of coffee. Where normally it would cost you 3.90. So, the price is pretty good. Just like with the 12 packs... A 12 pack of Via is less than $10. So youre getting a $2 discount
10-01-2009 @ 4:45PM
Dillon said...
You can't really blame them for having their prices so high, they are in debt and a few days ago they were on the list of buisnesses that are making a decline and having to sell some of their retailers off. Yes, Pricy, but they need it for themselves and their workers right now. But, ofcourse, someone high up in their chain could very well be blamed for their cash shortage.
9-30-2009 @ 5:19PM
northerngreenn said...
Comparing it to Starbucks ridiculously overpriced coffee in it's stores isn't a good argument.
Like the article said, it is on average 12 times more than other instant coffee. If I am in such a rush I can deal with a little less flavor and huge savings.
9-30-2009 @ 6:28PM
Christine said...
The R and D alone that was invested in this new product is most likely to be the reason for its price point. But as with everything else consumers will bring the price down by supply and demand. Do your own taste challenge with another instant coffee out there and then think again if Stabuck's VIA isn't worth every penny. I gave up buying instant years ago. I for one am thrilled to have an instant coffee that I can actually enjoy from now on in case of emergencies!!
10-01-2009 @ 3:41PM
No name. said...
Your absolutely right.
Everyone needs to stop comparing Via to already brewed coffee from a $2000 coffee pot sitting at Starbucks Coffee House. This stuff taste nothing like a coffee that would be rated by any coffee critic other than a instant coffee review.
If the Via is to be compared to anything, it should be compared to the ground/whole bean coffee that you buy from Starbucks to brew yourself in your own pot. We still have to heat our own water and mix it! A bag of ground/whole bean cost around the same price maybe a little more than the 12 cub Via, and makes a lot more coffee. Especially if you brew weak coffee.
9-29-2009 @ 10:02PM
Iridium said...
But you still need hot water. People don't use instant coffee so they can have a cup on the go or make a cup while they are walking on the sidewalk. You still need hot water.
People used instant coffee at home because it was easy and there was no such thing as a 1 cup coffee maker. Even now one cup coffee makers are still very expensive and don't work very well.
Starbuck's is a success because they gave people on the go access to quality brewed coffee. People were willing to pay $3 for a cup because it tasted better than what they could make at home and is quick and easy to get.
Buying Via makes no sense because you need to either bring hot water with you or have access to a microwave or kettle to make a cup. The entire convenience factor of being able to pass a Starbucks on every corner is gone.
I know when I am jogging, at the game, or on a mountain I always have piping hot water with me. There is also nothing worse than cold instant coffee.
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9-30-2009 @ 11:38AM
mike said...
You dont need hot water to use via!
9-30-2009 @ 2:57PM
Manda said...
Thank You! That is exactly what I was thinking the entire time. In the time it takes to brew a pot of coffee for all to share, it takes the same amount of time to boil a kettle of water. And I don't care what brand name is on the package, any faithful coffee drinker can tell the difference between brewed coffee and instant!!!
9-30-2009 @ 2:53PM
TM said...
I work at Starbucks. You can actually put VIA into cold water and ice and have iced coffee. You can also put it in milk and it tastes like a sweet latte. You definitely don't need hot water for this ready-brew VIA coffee.
9-30-2009 @ 3:00PM
Jenny said...
I just wanted to let you know that Via can actually be mixed with hot or cold water or even hot or cold milk. It's microground 100% coffee that dissolves in any liquid. Bottle of water and pack of Via and you're ready to go!
9-30-2009 @ 5:19PM
Cheryl said...
You said it all right there just where do you get the hot water ...lol on the go I dont think so
9-30-2009 @ 5:22PM
Ken said...
Surely you people jest! Yes, I have bought two cups of brewed Starbucks over the past few years. While Starbucks is pretty good, unless you are a died-in-the-wool Starbucks freak...the price of either brewed or Via is riduculous..
I am over 65 and I pay .42 for a cup of McDonalds "senior" coffee, or a buck for MANY other brands which I find cery satisfying! What am I missing?