Competition Heats up in the Single-Serve Coffee Market: Keurig vs. Competitors

Keurig’s Coffee Supremacy Challenged by Canadian Firm

The above article states how the single-serve coffee market is becoming increasingly competitive and challenging, specifically for the well-known company of Keurig . Keurig’s first coffee maker was innovative, convenient, and loved by many coffee drinkers, causing their sales to skyrocket. However, their extremely high profit was mostly due to the sale of K-cups, the coffee pods that allow consumers to create different drinks when using the machine. Eventually, competitors began to take notice and created their own coffee pods, which were cheaper and could all function in the Keurig machine.  Therefore, in order to take control of the self-serve coffee market, Keurig created a new point of difference to draw consumers back to their products. They designed a new model which is only capable of reading the ultraviolet ink of the K-cup.  If consumers wanted to purchase the new model, they would only be able to use K-cups to make their coffee, allowing Keurig to generate a larger profit. However, this would cause a huge inconvenience to consumers because they would only be allowed to purchase one single brand, even if they desired otherwise. Also, Keurig is currently facing a lawsuit for “anti-competitive behaviour” because they are preventing competitors from making a profit and contributing to the self-serve coffee market. As stated in the article, Club Coffee, a Canadian-made self-serve coffee company discovered the use of ultraviolet ink and distributed that information to all of Keurig’s other competitors.  This made Keurigs new point of difference completely irrelevant, and transformed it into a point of parity that is shared between it’s competitors. If Keurig wants to keep it’s profits constant and be number one in the self-serve coffee market, they must come up with a new value proposition, one that is fair to it’s competitors and consumers, while also making them unique.