Industry News | August 3, 2010

Sales of Starbucks VIA Cross $100 Million

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Just 10 months after its debut, Starbucks reports that its newest innovation, Starbucks VIA Ready Brew, has reached the $100 million mark in global sales.

According to SymphonyIRI Group, U.S. products that generate in excess of $50 million in first-year sales are recognized with a “mega hit” benchmark status. Starbucks VIA is among the top 3 percent of all new products with sales well in excess of the $50 million threshold as defined by SymphonyIRI.

As further context for VIA’s U.S. success, when compared to the $330 million premium single serve/pod category, VIA has achieved sales approximating 30 percent of the market share in this segment. As a premium portion coffee solution that doesn’t require any special equipment, Starbucks VIA is resonating with U.S. consumers and meeting untapped demand.

Fifty-five percent of Starbucks VIA customers surveyed are drinking it at home; 25 percent at work; and the remaining 20 percent while on the go, making Starbucks VIA a convenient way to get a cup of Starbucks coffee anytime. Additionally, nearly 40 percent of those surveyed said VIA is additive to beverages they are currently drinking, rather than a replacement to existing Starbucks coffee.

“We are extremely pleased with customer enthusiasm and adoption of Starbucks VIA Ready Brew,” says Howard Schultz, Starbucks chairman, president, and CEO. “Hitting $100 million in global sales in less than a year is a terrific accomplishment. I want to thank our customers for helping us reach this milestone. In comparison, it took our Frappuccino blended beverage business about three years to reach this level of sales.”

Starbucks VIA Ready Brew is available in approximately 37,000 points of distribution in the U.S. today, which includes about 25,000 food, drug, and mass merchandiser stores, such as Target, with the remaining 12,000 coming from Starbucks stores, foodservice accounts, and e-commerce. By the end of fiscal year 2011, Starbucks anticipates the number of non-Starbucks stores carrying VIA will increase by approximately 3,000 as well as growth in Starbucks Foodservice accounts, which will bring the total points of distribution to about 40,000 locations nationwide.

“We are continuing to drive steady increases in VIA distribution … channel by channel, country by country,” Schultz says. “In the next few weeks, we will announce new product innovation as well as an additional international market entry for Starbucks VIA.”

Innovation around Starbucks VIA by expanding the product line beyond Colombia and Italian Roast SKUs, and into new channels, remains a priority for Starbucks. Starbucks VIA Ready Brew Decaffeinated Italian Roast, launched last November, and Starbucks VIA Ready Brew Iced Coffee, launched in late June, represent the beginning of the Starbucks VIA innovation pipeline. Rapid innovation will provide opportunities to further increase awareness and trial of Starbucks VIA and broaden the customer base both in the U.S. and abroad.