SEATTLE -- Starbucks Corp. is experimenting with a $2.50 cup of coffee that would add a new, premium product to help fight the first drop in U.S. customer visits in its 37-year history, reported Bloomberg.
In its hometown Seattle, Starbucks is testing a 12-oz. cup of "fresh-pressed" coffee at $2.50 each. The price is $2.25 in a Boston trial. Starbucks charges $1.55 for a regular brew. McDonald's has been stealing customers with $1.39 coffee and is challenging Starbucks by adding espresso counters.
The new drink, made in a machine that brews each cup individually, may become part [image-nocss] of CEO Howard Schultz's plan to increase traffic in the 15,000 stores of the world's largest coffee chain. Starbucks is also experimenting with a $1 refillable cup of coffee and slowing its expansion. (Click here for details.)
"If they can create a better-tasting product and if they can get people to pay more for it, then you'd have the missing ingredient, which is pricing power," Larry Miller, an analyst at RBC Capital Markets, Atlanta, told Bloomberg. At the same time, selling a more expensive drink may be tough as U.S. consumer spending slows, Miller said.
A new brewed coffee would be priced just less than the lattes and cappuccinos that are now among Starbucks' most expensive. A 12-oz. cup of those drinks costs $2.55.
An $11,000 machine known as the Clover generates the new coffee. A piston rises and creates a vacuum that pulls water through ground coffee, much like a French press. The Clover's maker said it produces a better tasting drink because the grind, water temperature and other parameters can be set for each cup.
"Testing like this is something we do regularly," Starbucks spokesperson Brandon Borrman said.
The Clover was designed in 2005 by two Stanford University graduates working from a converted trolley shed in Seattle. Their machine is now used in more than 100 cafes and has gained a cult following among coffee aficionados. The Clover's price compares with $1,000 to $4,000 for standard commercial brewers.
Servers can make cups of Sumatra or Ethiopia Shakisso in 30 to 50 seconds. At one cafe in Seattle, Starbucks offers a choice of six brews, with tasting notes styled after a wine list.
Click hereto view the Clover website.
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