Wednesday, January 28, 2009

Coffee Steeps in Value Marketing

Even Pricey Espresso Makers Are Touted as Cheap Starbucks Alternatives
Wall Street Journal
January 15th, 2009

As the economic slump puts the brakes on discretionary spending, kitchenware retailers and coffee-machine manufacturers are plugging everything from coffee beans to gleaming, $3,000 café-style espresso makers as ways to save money.

"Did you know cutting just one of those typical 'tall' lattes a day and replacing it with a delicious premium organic coffee you brew at home can save more than $1,200 a year?" goes a recent pitch in a news release from New Jersey coffee roaster Good Earth Coffee.

Reduced consumer spending has spelled trouble for the big coffee chains. Among the Starbucks customers who plan to spend less at the chain, 43% say they plan to brew coffee at home more often, according to research by Larry Miller, a restaurant analyst at RBC Capital Markets. That spells opportunity for the home-coffee-brewing sector.

Bodum, which makes French-press coffee makers and accessories like milk frothers, recently sent out a pitch saying users could save more than $1,000 a year making their coffee at home. Sales rose about 10% in 2008, says Bodum USA President Thomas Perez.
Philips Electronics, meanwhile, is touting its single-serve Senseo machine, which makes coffee from capsules, as an alternative to takeout coffee. It says the Senseo could, over five years, produce enough savings for a car down payment or a chunk of college tuition.

Even those who sell coffee machines costing $1,000 or more are stressing value. Sur La Table, a gourmet kitchenware chain, says its employees strive to help customers find the machine that best meets their needs. The chain has drip machines that sell for $100. But it specializes in fully automated coffee centers starting at around $1,000. The staff is told that "it's OK to let a customer know that if they're buying coffee every day at a Starbucks on their way to work, that that can quickly add up," says Jacob Maurer, a Sur La Table buyer.

"Value" advertising has typically flourished in downturns, says David Court, leader of the global marketing and sales practice at McKinsey & Co., but it can be a tricky sell. "Advertising works best when the message is incredibly simple," Mr. Court says. "The concept of value is a more difficult thing for the consumer to understand than 'Get a brand I know on sale.' "

Sales of coffee machines fell in 2008, but retailers say they are a relative bright spot amid sluggish consumer spending, and some say they are seeing only growth in the area. At, sales of single-serve machines, like the Keurig and Nespresso, as well as espresso machines, were up last year and outpaced the overall growth of Amazon's home and garden store, says Chris Nielsen, vice president of the category.
And some retailers are discounting heavily. Shoppers can find some coffee machines 25% to 50% off at Macy's and 20% to 35% off at Bloomingdale's.

Bloomingdale's saw a "double-digit-plus increase" in sales of single-serve machines and espresso machines last year, says Joe Laneve, senior vice president of home furnishings. At in-store demonstrations, the pitch focuses on how easy it is to brew a perfect cup of coffee, Mr. Laneve says. But he says the follow-up is, "By the way, if you're going to drink two or three Starbucks a day, this is a good way to save."
New investment in home coffee-brewing machines could have a lasting impact on $3-a-day latte habits, says Mr. Miller, the analyst. "I think you're going to see some of these folks not return to buying coffee outside the home."

Deb Trevino, a spokeswoman for Starbucks, which sells coffee machines and prepackaged coffee in its stores, says the chain recognizes that making coffee at home is an attractive option for customers. But, she adds, "our customers find value in coming to Starbucks" for the convenience and ambience. Even so, Starbucks has rolled out a loyalty card and other promotions that offer customers cheaper drinks.

Those who make coffee at home say they like the savings. Caroline Kauffman of Denver traded her daily grande chai tea latte for a Keurig machine that makes single cups of coffee and other drinks from capsules. With coupons, she pays about 40 cents a cup for coffee. "I don't go at all to Starbucks now," she says.

Not everyone is sold. New Yorker Marco Barontini indulges in an espresso out every day. Mr. Barontini, an independent money manager, says he thinks buying an espresso machine would save him money in the long run, but isn't interested in making a purchase. "It's just easier to stop in and pick up a cup," he said recently while visiting a Starbucks. "I like my convenience."

Originally printed in
Write to Juliet Chung at

Monday, January 12, 2009

Hot Water

By Oliver Schwaner-Albright
New York Times - Times Topics
January 12, 2009

I recently came across a new product useful for those of us who brew coffee with a press pot, cone filter or Chemex: Breville’s variable temperature kettle [] ($149.95 at ). It heats water to a number of pre-programmed temperatures, including 200˚ Fahrenheit, which is ideal for coffee.

While not exactly a breakthrough, it’s an improvement over how most coffee is brewed. Water temperature is one of the four technical variables that shape a good cup of coffee (the other three are: amount, grind and time), and the rule of thumb is that coffee should be extracted at 200˚ Fahrenheit, or just below water’s boiling point. More often, water hits the grounds at a much lower temperature, and many standard home brewing machines are set by the manufacturer to a tepid 165˚ or 185˚. (A notable exception is the Technivorm [].) The drop makes a big difference. Unfortunately, you might not be getting the most out of your coffee.

For years I’ve made press pot coffee with water from a basic Breville electric kettle []. It was left behind by a houseguest as a thank-you, for which I’m forever grateful. The Australian-made appliance has proven to be a workhorse, and quickly heats water to a rolling boil, which means a little bit of winging it to get it to the correct temperature.

But now there’s no need for guesswork. Press the 200˚ button and water temperature is no longer a variable.

Again, Oliver's original post can be seen at today's New York Times Times Topics entry (January 12, 2009).

Wednesday, January 07, 2009

A perk for coffee lovers: java may lower oral cancer risk

Katherine Harmon
Published in Scientific American January 7, 2009

Raise high the coffee bean! Good news, coffee-drinkers: a new study shows your beverage of choice may lower your chances of getting oral, esophageal and pharyngeal (back-of-the-throat) cancer.

Japanese researchers report in the American Journal of Epidemiology this week that people they studied who drank a cup or more of Joe daily had about a 50 percent less chance than non-imbibers of developing these cancers. The scientists based their findings on 13 years of data of some 38,000 people ages 40 to 64 with no history of cancer.

According to the study, coffee drinking lowered the odds of these types of cancer even in people with high-risk behaviors (read: smoking and boozing).

"Caffeine has been suggested to suppress the progression of tumor cells," senior study author Toru Naganuma, an epidemiological researcher at Japan's Tohoku University, told in an email. He noted that other studies have also linked moderate coffee drinking to reduced risk of liver cancer.

"The evidence is pretty strong" in this research, says Ann Gillenwater, a professor of head and neck surgery at the University of Texas M.D. Anderson Cancer Center in Houston, who was not involved in this study.

But that doesn't mean you should start downing double espressos hourly. Recent research suggests that too much caffeine can lead to insomnia, anxiety and might up the risk of miscarriage in the early stages of pregnancy.

Besides, the study authors point out, caffeine alone is not the answer, noting that "high-level consumption of fresh vegetables and fruit" have also been linked to lower cancer rates.

The upshot, says Gillenwater: to lower your risk of oral cancers, "you want to have good dental hygiene and eat fresh fruits and vegetables, and maybe [drink] coffee. Who knew?"

To visit Scientific American its original post:

Tuesday, January 06, 2009