* Four new retail blends not expected to boost Lavazza's
* Lavazza will face strong competition in U.S. grocery
* Lavazza's Rivo Keurig System still in infancy
By Marcy Nicholson
NEW YORK, May 14 Italy's Lavazza is joining the
ranks of Starbucks and Gevalia in the highly competitive
specialty coffee section on grocery store shelves as the nearly
120-year-old roaster makes another push into the U.S. and
Canadian consumer markets.
The family run business, a brand little-known by North
American consumers that has been supplying its Italian-roasted
brews primarily to U.S. restaurants for years, will launch four
specialty blends of bagged coffee in September as a part of its
The company aims to boost international sales to 50 percent
of its total, up from the current 46 percent, said Ennio
Ranaboldo, chief executive of Lavazza North America.
While the move is unlikely to boost Lavazza's coffee volumes
significantly in the near term, the United States could in time
become its second-biggest market after Italy, its flagship
market. Currently, the U.S market ranks fifth or sixth,
Ranablodo said, and France is its second-biggest market.
"The U.S. and Canada are a priority for Lavazza. The U.S.
... is still the richest, most dynamic coffee market in the
world," he said.
Lavazza buys around 2.3 million bags of green coffee
Going head to head with U.S. household brands such as
Starbucks Corp, the new blends Gran Aroma, Classico,
Gran Selezione and Perfetto will be on U.S. and Canadian shelves
in time for the holiday season at the end of the year.
Lavazza sees opportunities for its new blends as American
coffee connoisseurs are increasingly looking for sophisticated
Competition in the coffee grocery aisle is intense,
dominated by premium brands owned by Starbucks and Kraft Foods
Starbucks cut its grocery list prices on its Seattle's Best
packaged coffee by 10 percent this month as coffee costs fell
and it fought for more sales through supermarkets and other
Kraft later announced it lowered the price if its premium
Gevalia brand by 6 percent, marking the second price cut in a
year, as green coffee prices fell.
The company has been selling its more established blends in
the less-visible ethnic aisles for years.
Last week, the Turin-based company increased its stake to 8
percent in U.S.-based Green Mountain Coffee Roasters Inc
, which makes Keurig single-serve brewers and K-Cups.
Lavazza made its first move into the mainstream North
American consumer market late last year when it launched the new
Keurig Rivo System, a single cup machine that makes cappuccinos
and espressos, with Green Mountain in the U.S. market.
Lavazza has been selling its own single-serve espresso
machines in Europe since 1989.
Single-serve machines are a fast-growing sector in the
coffee industry and allow consumers to make one fresh cup at a
time, typically at home or in the office, with individual pods
of brewed coffee.
Ranaboldo declined to share Keurig Rivo sales figures,
saying it is still in its infancy, but he said Lavazza expects
single-serve will play a key role in its U.S. growth plan.
The move is not likely to boost Lavazza's coffee volumes
significantly, however, in the near term.
"It still stays in the ballpark of what Lavazza has been
planning for its regular growth, which still is an organic
growth," he said.