Krispy Kreme Doughnuts, Inc. (KKD) and Green Mountain Coffee Roasters Inc. (GMCR) has entered into an agreement to widen the homemade single-serve coffee options for Keurig users.Under the multi-year agreement, Krispy Kreme’s upcoming coffees — Smooth and Decaf — will be available in K-Cup packs for Keurig brewers.
Krispy Kreme K-Cup packs will be available at the online shopping sites of Keurig and Krispy Kreme along with the participating Krispy Kreme shops, grocery, retail, and Away-From-Home channels throughout the nation.
The Keurig business unit of Green Mountain is a leading manufacturer of gourmet single-cup brewing systems. It sells beverages produced by other business units of the company through At-Home and Away-From-Home channels. Green Mountain sells K-Cups under different brands including Caribou Coffee, Gloria Jean’s and Van Houtte. Krispy Kreme offers premium-quality sweet treats and is well known for its signature Original Glazed doughnut.
The tie-in will boost sales of Krispy Kreme’s coffee as the convenience of Keurig brewers will enhance the popularity of its beverage among Keurig fans. Moreover, the pact furthers Green Mountain’s goal of sustaining its dominance in the single-serve brewing market even after the expiry of its K-cup patents in Sep 2012.
Green Mountain Coffee aims to popularize the single-cup brewing system in America and has signed several strategic distribution agreements to rope in popular brands like Dunkin’ Brands Group Inc. (DNKN) and Starbucks Corp. (SBUX) into its portion pack systems.
On Feb 06, 2014, Green Mountain, which currently carries a Zacks Rank #1 (Strong Buy) entered into a 10-year partnership with The Coca Cola Company (KO) to allow consumers to make sodas and other drinks at home.
Under the deal, Green Mountain will exclusively make Coca-Cola branded pods for use on its upcoming Keurig Cold at-home beverage system for making cold beverages. Coca-Cola will also work with Green Mountain on the development and launch of this latest version of Keurig single-cup brewer. Also, Coca-Cola is buying a 10% stake in Green Mountain for about $1.25 billion.
Through these agreements, Green Mountain is aligning with the strongest beverage brands to support a range of consumer choices and taste profiles in Keurig Single-Cup Brewing system. Per market research firm NPD Group, this has secured the company a place among the top-four bestselling coffee makers between Oct and Nov 2013.
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