Redbox Aims At Starbucks
the same effect on Starbucks that it did on Blockbuster.
Redding expects each machine to serve as many as 28 coffees and lattes a day, with a simple cup fetching $1 to $1.50 and specialty drinks $1.50 to $2. At those prices—up to $1.50 less than Starbucks for a latte—Coinstar is going after price-conscious shoppers. Coffee-sipping Americans on average spend about $5 a workday for their lattes and mochas outside the home, or $1,092 a year, according to Accounting Principals, a researcher in Jacksonville, Fla. That’s led everyone from gourmet chains, including Starbucks and Peet’s Coffee & Tea (PEET), to fast-food chains such as McDonald’s (MCD) and Dunkin’ Donuts to hawk java. Coinstar may eventually install as many as 15,000 Rubi kiosks. While that might generate sales of $200 million a year, according to Eric Wold, a B. Riley analyst in San Francisco, Rubi is unlikely to disrupt the coffee market the way Redbox upended DVD rentals. One reason: more competitors.I can't see any of my coffee snob pals buying their go-go juice from a vending machine, but I'm guessing they are nowhere near the target demo for Coinstar.