American company Kraft Foods has decided to make a revolution in a separately considered market. They are designing a new coffee-making machine. Kraft intends to eliminate cheap drip coffee makers and to decidedly accustom the world to a quality drink. The company hopes to increase the consumption of the drink. Russia will also be involved in the coffee war. However, one should note the importance of taking into account the peculiarities of each country and also such essential thing as average income of the population of countries - targets of the new direction of the company's activity. Lately Kraft Foods has been feeling quite uncertain in the market. The executive officer of the company Rodger Deromedi is personally unsatisfied with the last year's results. The new coffee maker initiative, according to the company's management, should bring it back to the track of stable growth. Kraft promises that the new low pressure home coffee maker will allow to brew espresso coffee of restaurant quality at home and thinks that it will become a blockbuster in the American market. It will be manufactured on the production facilities of a small company Hamilton Beach/Proctor Silex.
The main purpose of the new project of Kraft Foods is the promotion of specially-packed ground coffee. Each coffee machine consumes an average of 1,000 one-load bags of packed ground coffee a year. But the company is also seriously considering the prospects of entering the market of coffee-making equipment. Today it is filled with cheap drip coffee makers which cost no more than $10-13. The coffee made by them is not of the best quality, but until lately there were no alternatives. The most inexpensive espresso coffee makers cost about $300 as late as 10 years ago. And a one-load bag of ground coffee cost an American housewife about $1. Today the situation has changed. There are 108 million coffee consumers in the country. The cost of home low pressure coffee makers lowered to $60, and a one-load bag of coffee in the U.S.A. costs no more than 20 cents. In these conditions the manufacturers of coffee-making equipment think that quality coffee makers must enter every household to replace drip coffee makers. In the U.S.A. there are about 48 million coffee-consuming households and about 16 million old-type coffee makers waiting for replacement. And the yearly volume of the market for coffee equipment is estimated at $1.5 billion.
Kraft Foods' competitors - the companies Nestle, Procter&Gamble, Sara Lee and Salton - are also on the alert. They launched own projects of manufacturing their original coffee machines. This year Sara Lee will start selling its version of home coffee makers in the U.S.A. P&G together with Black&Decker are promoting the sales of low pressure espresso coffee makers in the U.S.A. under strong brands Folgers and Millstone. The coffee monsters have one purpose - to stimulate the sales of own-produced ground coffee through the market of coffee makers.
There is an obstacle to the conquest of American market of home coffee makers - it is the culture of coffee consumption in the States. Unlike Europeans, Americans are used to drinking coffee by large mugs, and "quick" drinks are more popular among them. Despite all efforts of coffee corporations to promote "real" coffee, USA, as well as Great Britain and Russia, remain the instant coffee country.
"In Russia the consumption of ground coffee and roasted coffee grains is growing with the highest speed amid all the market?",- says Kirill Bolmatov, corporate manager of Kraft Foods. - Today this segment accounts for more than 15% of Russian market."
And the market of professional and home coffee makers and coffee grinders is developing along with the market of ground coffee. By now, the market is saturated with coffee making equipment from Italy, Germany, USA and Switzerland. However, considering the fact that coffee consumption in our country is about 350 g per person a year compared to several kilograms in European countries, the prospects of development of coffee businesses become obvious.