With the market for premium coffee reaching the point of saturation, Starbucks has taken a step towards diversification by heading into the natural foods market. Starbucks announced last Thursday that they had acquired San Bernardino-based Evolution Fresh Inc., a natural fruit and vegetable juice maker, for $30 million all-cash. Evolution Fresh is a brand created by Jimmy Rosenberg who also created the Naked Juice Brand.
Starbucks Chief Executive Howard Schultz said “Our intention is, over time, we would have a national footprint of juice stores positioned for health and wellness.” Kurt Frederick, a health and wellness analyst is quoted in the LA times as saying “”Juice and health food is somewhat related to what Starbucks already offers now, and it’s a growing and attractive industry…Many people are interested in natural and organic food now.”
If you’re wondering why Starbucks is getting into the juice market here’s why the premium juice business stands at $1.6-billion and the health foods market is at $50-billion in the USA alone. With that kind of market to tap into it’s no wonder that Starbucks wants to get a piece of that pie. They have not said anything yet on if they plan to expand into international markets but my guess is that if it proves a hit in the US, then it will definitely be tested overseas.
So far the company plans to carry the Evolution Fresh juice line in their stores with the ultimate goal being to open so called “juice shops” but no word yet on what format these shops will take. If we know anything about Starbucks it’s that their marketing department is top notch and they will find a way to make us believe that that juice is the best thing since sliced bread.