Food Business News - February 12, 2013 - (Page 9)

Editorial EDITORIAL STAFF Editor-in-chief Morton I. Sosland Executive editor, markets Neil N. Sosland Editor L. Joshua Sosland Executive editor Keith Nunes Senior editor, markets Jay S. Sjerven KEITH NUNES Starbucks is redefining brand loyalty Managing editor Eric J. Schroeder Associate editor Jeff Gelski Associate editor Ron Sterk Assistant editor, markets Laura Lloyd Internet editors Allison Gibeson Erica Shaffer Monica Watrous Graphic designer, market graphics, data Christina Sullivan PUBLISHING STAFF Chairman Charles S. Sosland Vice-chairman L. Joshua Sosland President and publisher Mark Sabo Associate publisher G. Michael Gude David DePaul Bruce Webster Vice-president, chief financial officer Melanie Hepperly Audience development director Don Keating Advertising manager Nora Wages Director of design services Sadowna Conarroe Circulation manager Judith Arnone Digital systems analyst Marj Potts Manager of advertising design Becky White Director of e-Business Jon Hall Director of on-line advertising and promotions Carrie Fluegge Promotions manager Taré Torres WE’RE EAGER TO RECEIVE YOUR FEEDBACK: E-mail or write to us at Food Business News, 4800 Main Street, Suite 100, Kansas City, Mo, 64112 February 12, 2013 ttention must be paid to the Starbucks The market research firm SymphonyIRI reCoffee Co. and how it is in the process cently issued a report that says consumers have of altering food and beverage merchan- “drastically” changed their approach to grocery dising. The company that has reinvigorated the shopping during the past decade. They comcoffee segment by turning coffee drinking into bine on-line and offline planning with in-store a value-added proposition is now on the cusp visits and make more informed and cost-effecof redefining how consumers shop for its prod- tive purchasing decisions. ucts in grocery formats and how they perceive “Emerging and evolving technologies have brand loyalty. enabled innovative marketers to begin reachOver the next few months Starbucks will ing shoppers in their homes while they are reunveil a strategy to extend its loyalty program searching products and making their lists, and to the products it sells within the consumer packaged goods sector While the Starbucks name is synonymous with coffee, and specifically the grocery segment. The company will leverage its plans have the potential to involve several parts of technologies such as Smartphone apps that executives believe will the grocery channel and put pressure on competitors allow consumers to buy Starbucks products outside of the company’s that are already working to differentiate their products stores and still earn rewards. This is significant given Starfrom a variety of private label offerings. bucks’ recent substantive expansion into the bakery, juice, tea and ready-to-drink iced coffee segments. While the Starbucks name is synony- then reinforcing their messages on the way to mous with coffee, its plans have the potential the store, and in the store when consumers are to involve several parts of the grocery chan- making their final selections,” said Susan Vianel and put pressure on competitors that al- mari, a researcher with SymphonyIRI. “Marketready are working to differentiate their prod- ers that keep pace with and embrace this opportunity will achieve success, while those who ucts from a variety of private label offerings. The popularity of Starbucks’ rewards pro- fail will find it difficult — even impossible — to gram, which allows customers who register remain relevant and competitive.” The purpose of merchandising is to spur with the company to earn rewards such as free beverages and other benefits, is undeniable. consumers into action and make a purchase. During the first quarter of fiscal 2013, Starbucks Merchandising that accomplishes this goal is accelerated the growth of the rewards program said to have achieved “sales lift,” according to by adding 1.4 million members, an 86% increase SymphonyIRI, but in recent years, the research over the 778,000 members it added during the group says average sales lift has declined 70% same period of the previous year. In addition, in the grocery category. Starbucks is in the process of changing how more than 7 million customers now use one of the company’s mobile payment apps, which some grocery shoppers perceive merchandistranslate into 2.1 million mobile payment trans- ing and its products. While the company’s business model of presenting a strong brand in both actions each week. In a recent conference call with financial an- food service and consumer packaged goods alysts, Howard Schultz, chairman and chief ex- gives it an advantage over traditional consumer ecutive officer of the company, said this holiday packaged goods manufacturers, food compaseason was extraordinary for the company’s nies would be wise not to ignore this effort. There are many facets to brand loyalty, and loyalty program. “I must say it was stunning and almost it is clear Starbucks is in the process of tapping unbelievable,” he said. “Our Starbucks card into an element that was once the sole purview had its best holiday season in history, as mea- of retailers. While Starbucks may be on the sured by any metric, with more than $1 bil- cutting-edge of consumer packaged goods merlion loaded during Q1, the most ever loaded chandising, it would be wise for competitors to not fall far behind. FBN onto any kind of Starbucks card.” A FOODBUSINESS NEWS ® 9

Table of Contents for the Digital Edition of Food Business News - February 12, 2013

Food Business News - February 12, 2013
China problems may challenge Yum! Brands in 2013
Tyson Foods sees chicken demand rising
Kellogg frozen foods business on the fast track
Table of Contents
Web Contents
Editorial - Starbucks is redefining brand loyalty
General Mills settles Yo-Plus lawsuit
Green Mountain Coffee sees single-serve pack sales rise 21% in first quarter
Soren Schroder named next c.e.o. of Bunge Ltd
New Mexico legislature blocks bioengineering labeling bill
Pork prices may be volatile in 2013
Kraft Foods fills newly-created marketing post
Hershey has big plans in nuts and fruits
American Licorice Co. to expand in Indiana
Unilever to close spreads plant in Atlanta
Greek yogurt may be going to school
Frito-Lay to launch Taco Bell-inspired Doritos
Kellogg income rises on cost-savings, Pringles acquisition
China problems may challenge Yum! Brands in 2013
Juice, baking business come into focus for Starbucks
New product pipelines pump up protein
Washington - 'Smart snack' guidelines get favorable reviews
Market Insight - Per capita calories rise on added fats
Beverage Trends - Oat beverages offer benefits beyond the bowl
Ingredient Innovations - Fiber boosts for whole grain items
Harvard’s approval of 10:1 ratio draws critiques
Beverage Business News - Nothing to see here
New Food Products
Ingredient Market Trends - Open outcry trading of hard red winter wheat futures to shift to Chicago
Ingredient Markets
Supplier Innovations and News
Ad Index
Food Business in the News

Food Business News - February 12, 2013