Friday, October 19, 2012

Starbucks + Coinstar = Premium Coffee Kiosks

Rubi coffee kiosk
Coinstar, which owns the highly successful Redbox chain of DVD rental kiosks, has now teamed up with the Starbucks-owned chain Seattle's Best Coffee to create Rubi vending machines (oops, I mean kiosks) that dispense premium coffee by the cup.

The out-of-home coffee market is estimated to be as large as $28.5 billion yearly. No one competitor dominates, so the Rubi kiosk won't be trying to dislodge a well established brand. It's also selling premium coffees, lattes, and other specialty java drinks at prices below the menu price at Starbucks, a plus for price-conscious folks.

Seattle's Best used to feature its coffees in Borders bookstore cafes. Now that Borders has gone bust, Rubi kiosks are an opportunity to spread the Seattle's Best brand across the country once again.

Coinstar's CEO says that Rubi will offer "the kind of quality, convenience and value that we know coffee drinkers on the go will appreciate."

Will Rubi machines deliver enough revenues and profits per square foot to become fixtures at thousands of supermarkets, stores, and offices within a few years?

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