I'm Getting Naked Inside a Starbucks
By
Rick Aristotle Munarriz
January 16, 2008
|
If you've always wanted to get Naked at your local Starbucks (Nasdaq: SBUX), now's your chance.
Keep your clothes on, though, please.
Starbucks is teaming up with PepsiCo's (NYSE: PEP) recently acquired Naked Juice Company, offering up a selection of refrigerated juices and smoothies at nearly 7,000 company-owned Stateside stores later this year.
It's a sweet deal. Naked's lines of freshly squeezed orange juice and vitamin-spiked fruit smoothies are still relatively obscure. This is the kind of deal that can propel an upstart brand to stardom, also establishing it as a premium brand as consumers associate it alongside Starbucks' quality brews.
Just ask Jones Soda (Nasdaq: JSDA). Having Starbucks stock its root beer, cream, and diet black cherry bottled soft drinks helped the edgy pop star gain acceptance as a premium soda offering. Starbucks stopped selling Jones Soda's beverages last year, but only after Jones succeeded in landing a much wider distribution deal for its new canned product.
The move also comes as a relief to Jamba Juice parent Jamba (Nasdaq: JMBA). Both Starbucks and McDonald's (NYSE: MCD) have been indicating an entry into the smoothie market. Going with pre-packaged smoothie drinks makes it less likely that Starbucks will start blending fresher, made-to-order smoothies in-house. It allows Jamba the ability to avoid facing a fierce competitor, while opening the door for Starbucks to educate the consumer on the merits of boost-packed fruit smoothies.
Yes, the news could have been even sweeter for Jamba. Nestle announced a chilled line of Jamba smoothies last month, and it would have been great to see Nestle trump Pepsi. However, this does open the door for McDonald's to go with Jamba to differentiate itself from Starbucks if its plans don't include stocking its stores with Vita-Mix blenders and a counter of fruit and boost ingredients for handmade concoctions.
As for Starbucks, the Naked addition shouldn't get in the way of its namesake Frappuccino sales. The java heavy has been selling an assortment of bottled waters, sodas, and juices for years. It's a win-win deal, unless you happen to be a nudist who truly thought that you could get naked -- not Naked -- inside a Starbucks.
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