This case describes a new product success story, set in a competitive business c

Question

This case describes a new product success story, set in a competitive business climate. Keurig was one of the companies to commercialize an innovative technology that allowed people to brew one cup of coffee at a time. Keurig was established in 1992. The word, “Keurig,” means excellence, and it has been the guiding principle behind its products and services. Keurig patented its single serve brewing system and first entered the office coffee service, or Away From Home (AFH), marketplace in 1998. In 2003, Keurig became one of the first to enter the At Home (AH) marketplace with a single serve brewing system designed for use in the home.

By 2010, 25 percent of all coffee makers sold in the United States were Keurig branded machines. Keurig is regarded as a market leader. However, Keurig faces two major challenges. First, some patents of Keurig’s key technologies are approaching the expiration date. Without the protection of the patents, Keurig can lose revenue from the K-Cup portion packs, thus reducing GMCR’s coffee sales. Keurig can also lose royalties from other roaster coffee sales using Keurig’s technology. The second challenge is the perceived environmental impact of the K-Cup portion packs. It will need to be addressed to prevent erosion of Keurig’s position in the marketplace.

An evaluation of Keurig’s business-level strategy, competitive rivalry, and SWOT analysis will aid in the discussion and weighing of strategic options available to Keurig. The results of the analysis can then be used to establish and support a strong set of recommendations seeking to ensure a continuation of Keurig’s strong performance and top market position.       

Assess Keurig’s business-level strategy. Has the company’s business-level strategy been successful?

How does Keurig’s strategy stand up against competitive rivalry in the industry?

Review the important elements of Keurig’s external and internal environments. Analyze key factors in the SWOT analysis.

Evaluate Keurig’s s international strategy and its use of alliances to achieve company objectives.

Weigh the challenges confronting Keurig. What are the greatest risks for Keurig? What recommendations can be made to support Keurig’s growth and profitability objectives?

Explanation / Answer

SWOT Analysis:

Strength :

1. Biggest strength of Keurig is that it's product can be made easily at any time and any place.

2.Second major thing is that the buying a smaller pack of coffee will be cost efficient for the customers.

Weakness:

1. One of the weakness could be change in taste of coffee or change in taste of preferences of the customers.

2. Other thing is that making a stock of the product could be a bigger challenge as the product reaches the expiration level very soon.

3. Packing of product is also a problem because it is not eco-friendly.

Oppurtuities

1. Keurig can see students and younger generation as its main target market because they are the ones who love coffee and mostly remain outside the house.

2.Secondly, Keurig can target Corporate employees, who needs coffee in every hour but does not have time and proper facilities for preperation.

Threats:

1. One of the threat could be competiters stealing Keurig idea and making their own product on same pattern.

2. Other one is that company could reach a stagnancy level if they will not do a innovative change on periodic basis.

3. Whenever sales will be low, product will be expired without reaching the retailers.

4.Government could ban the product as the packing is not eco-friendly.

Recommendations:

1. Company should launch its product with different varients, so that the customers have wide choice and could choose according to their taste and preference.

2.Company should change its packing style and come up with products like paperpack or eco-friendly filters.

3. It should do a demand forecasting of the market and manufacture product only as per the demand of the market. So that it can cut extra inventory and transportation cost.

4. Keurig Research & Development should continuously focus on other brands in the market and customer reactions towards it.

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