Starbucks expands insta-brew, adds flavours

Starbucks Corp is set to debut its latest caffeinated concoction - flavoured instant coffee.

The coffee giant plans to announce Monday four new, slightly sweetened varieties of its successful Via instant brew. The addition is the latest in a series of new products as Starbucks tries to find new ways to grow after years of over-expansion of its cafés.

The flavours - mocha, vanilla, caramel and cinnamon - will be sold in Starbucks stores this fall, though no date has been announced.

The single-serve packets will be added to grocery store shelves early next year and will be backed by a promotional campaign backed by free samples, along with television, print and online advertisements.

Launched nationwide last September, Via racked up more than US$100 million in worldwide sales in the 10 months since its debut.

The packets, which dissolve in water, were initially sold in two roasts - a medium-bodied Colombian and bold Italian roast. Since then, the company added a decaffeinated variety and a medium-roast designed for instant iced coffee, and now sells Via in four countries.

Then in June, Starbucks began selling a new line of ground coffee in grocery stores called Starbucks Natural Fusions - the company's first-ever flavoured ground coffee.

Reaching for the lion's share

That coffee, brewed traditionally and without sweeteners like the new Via products, was the company's first entry into the US$265 million premium flavoured coffee market.

Adding instant coffee flavours expands the potential market size to $377 million, said Annie Young-Scrivner, Starbucks chief marketing officer.

The company's internal research shows that 60 per cent of buyers of its packaged coffee drink some sort of flavoured coffee from competitors, which means there's significant opportunity to snatch dollars from rivals.

"These are people that are drinking Starbucks coffee today," Young-Scrivner said. "But I think the flavour will bring in new customers as well."

Starbucks won't release prices or packaging sizes for the flavoured Via. But officials said its price tag would be similar to iced Via, which sells at US$5.95 for five single-serving packages.

- AP