Keurig, an American manufacturer of coffee brewers for both home and commercial use, was started by Colby College roommates Peter Dragone '79 and John Sylvan '80 in 1990. The company was a venture capital start-up business with funding from several investors based on the brewing of single cups of coffee, which provides for better consistency in the quality of the coffee. In 1993, Dragone and Sylvan, along with support from co-founder and current vice president of Contract Manufacturing and Quality Assurance, Dick Sweeney, based their business in Wakefield, MA.
In 1996, Green Mountain Coffee Roasters, (GMCR, Waterbury, VT) invested in Keurig, buying a 35% interest in the company and in 2006, GMCR acquired Keurig for $160 million. In early March 2014 the Green Mountain Coffee shareholders voted to change the company name to Keurig Green Mountain to reflect its business of selling Keurig coffee makers.
As the leader in specialty coffees, coffee makers, teas, and other hot and cold beverages, Keurig Green Mountain Inc, is recognized for its award winning beverages, innovative Keurig brewing technology, and socially responsible business practices.
 |
| Keurig B2000 |
 | ||
| Keurig's Rivo adds milk frothing feature |
GMCR owns and licenses many beverage brands, offering more than 400 flavors, for even the quirkiest of coffee connoisseurs, to choose from. In addition to a wide range of coffee varieties from Costa Rica, Mexico, Nicaragua, Guatamala, Brazil, and Sumatra, they also offer custom coffee blends, Organic Coffees, Fair Trade, flavored, and roasts such as Extra Bold, Dark Roast, Medium Roast, Light Roast, and Decafs.
Owning the patents on the K-Cups, Keurig has been able to successfully partner with companies like Starbucks, Dunkin Donuts, Newman's Own, Cinnabon, Tully's, Peet's, to brew their blends and distribute using the K-Cups. They have also partnered with tea companies to offer a wide range of teas, as well as premium hot chocolate from brands such as Ghiardelli, Timothy's, and Cafe Escapes.In November 2013, Keurig opened its first retail store inside the Burlington Mall in Burlington, MA. Fully equipped with every Keurig model imaginable and more k-cups than one can consume in 5 lifetimes, they allow everyone the option to sample new flavors, play with all the gadgets, and even pick up a few fun accessories for the coffee obsessed.
Keurig Green Mountain's Marketing Strategy:
PURPOSE: We create the ultimate beverage experience in every life we touch from source to cup--transforming the way the world understands business.MISSION: A Keurig brewer on every counter and a beverage for every occassion.
VALUES:
- We partner for mutual success.
- Our boundaryless approach to collaboration creates benefits for all.
- We innovate with passion.
- With courage and curiosity, we are shaping the future by redefining the customer experience.
- We play to win.
- Our team sets ambitious goals and meets each challenge with unified purpose and character.
- We brew a better world.
- We use the power of business to make the world a better place.
- 'Razor Blade' business model
- Focus on the People
- Commitment to "brewing a better world"
- Delight the consumer
- Commitment to growth
- Build infrastructure to support continued growth
BRAND POSITIONING
- For coffee drinkers who want the best cup of single serve coffee that is brewed fresh and fits their coffee needs.
- Kuerig Green Mountain Inc.offers the freedom of choice whether in choice of drink or in life all while providing the customer with satisfaction of KGM’s responsibility for sustainability
- No other coffee associated brand offers the choice, efficiency, and value for coffee and the satisfaction that comes with those liberties.
SWOT ANALYSIS
STRENGTHS- Dominant in single serve coffee market
- Focus on sustainability
- Partnerships
- User friendly
- Appealing to smaller households
- Strong sales growth
- Strategies to extend competitive advantage
- Awards won for freshness and taste of coffee
WEAKNESSES
- Moderately pricey
- Less appealing to larger households
- K-Cup patent expired
- Currently only brews one cup at a time
- Increase partnerships
- Growth in U.S. coffee market
- Growth in home and business markets
- Dual cup and whole carafe servings
- Word of mouth and loyalty of consumers
- New beverage opportunities
- New competitors with patent expiration
- Economic stability (money)
- Generic brands gaining popularity
The New Look
At the same time, by retaining Green Mountain in the name, they continue to honor the heritage and the Vermont roots of Green Mountain Coffee, acknowledging the importance of the beloved brand. Since the Green Mountain Coffee brand is synonymous with quality, strong community relationships, and socially and environmentally friendly business practices, their commitment to quality and sustainability remains unwavering.
Finally, by removing the 'Coffee' name from the new identity, they are removing any limits to their potential. They are committed to being more than 'a coffee company', and instead, an innovative, technology driven, values-based personal beverage system company
.
This new look appears to encompass the corporate business. Currently, 'www.keurig.com' and 'www.greenmountaincoffee.com' continue to operate as e-commerce sites with no official mention of sun-setting for either site.
External Communication:
Promotional Materials -Online and Print
Advertising Campaign Business to Business
Advertising Campaign Business to Consumer
FOR INVESTORS AND OTHER EXTERNAL PUBLIC INFORMATION:
 | |||||||||||||
News Reports
On February 6, 2014, Coca-Cola announced a 10-year partnership with GMCR to develop products with the Keurig cold beverage system due out in 2015. Coca-Cola paid $1.25 billion for a 10% stake in GMCR. At that date shares of Coca-Cola were slightly elevated, up roughly 2%, while shares of GMCR were soaring at 30%.
Social Media Presence
Website: With a bright, colorful, easy to navigate, user-friendly website, Keurig provides a wealth of pertinent information that any individual in their demographic might want or need.
From coffee products, bakery items and sandwiches to nutritional information, store locations, merchandise, blogs, and Rewards program
customers can easily find their specific interest. The most pertinent
information appears on the homepage, such as the current contest or
sweepstakes, links to their blogs, Twitter, Facebook and YouTube and the
new mobile app download.
 |
| E-Commerce Website Homepage |
 |
| Facebook Homepage on March 22 |
TheKeurig brand created an online presence starting in 2008 and it currently exists across multiple social media platforms. Their strategy, aimed at growing and maintaining a highly engaged global community of their fans, has taken off with 2.5+ million Facebookers, 204,000+ Tweeters
Keurig does an outstanding job of engaging with their customers by responding to them on social networking sites like Twitter and Facebook. By posting questions and polls, Keurig is very successful in generating conversations and interest with their audience.
 |
| Facebook Homepage on April 22 |
 |
| Facebook Promotion on St. Patrick's Day |
 |
| Keurig Twitter Home Page March 22 |
 |
| Keurig Pinterest Homepage |
 |
| Keurig Pinterest Board 'Where in the World' |
Analytical Data Observations
Utilizing such online monitoring tools as Addictomatic, Google Trends, Ice Rocket, SocialMention, QuantCast, and Social Bakers to track and analyze the social media buzz surrounding the brand, I will look at social networks including Facebook, Twitter, Keurig.com website, blogs, videos, and images posted on these networks, that directly relate to the brand to see how Keurig connects with their customers and uses promotions, contests, sweepstakes, games, etc. to grow their customer base.
Below are the results of a search on Addictomatic for Keurig social media activity over 4 to 8 weeks. Not surprisingly, there are many and varied social media sites, news sites, image areas, blogs, and feeds where there has been some mention of the Keurig brand.
DAILY BLOG MENTIONS - JANUARY - APRIL 2014
GOOGLE TRENDS ANALYTICAL DATA
 |
| Large spike in Feb corresponds to the Coca-Cola deal |
 |
| Large spike week of Feb 6 corresponds to Coca-Cola deal |
FACEBOOK ANALYTICAL DATA
TWITTER ANALYTICAL DATA
YOU TUBE ANALYTICAL DATA
ADDICTOMATIC DATA RESULTS
Leadership and Management Style
Top of the leadership board in the Keurig Green Mountain organizational hierarchy is Brian Kelly. As President, CEO and Director, Kelly took on this role in December of 2012 from the Coca-Cola Company, where he was President of Coca-Cola Refreshments and more recently, Chief Product Supply Officer. In addition to these roles, Kelly has also held executive positions at North American Van Lines, Ford Motor Company, General Electric Company, and Proctor & Gamble.In my research, all of the aforementioned companies, being global in nature, operate in the typical Classical Theory of Organizational Communication.
Bureaucratic Theory
Max
Weber and Henri Fayol's theories focus on the structure of the organization rather than the
organizational activities.
Weber termed bureaucracy
as the ideals in which organizations should aim for and aspire. Weber
was influenced by socialist philosophy. He developed the idea of
bureaucracy when he noticed several corrupt and unethical behaviors of
leaders. He felt that organizational leaderships should center on task
proficiency and impersonal relationships. According to Weber, bureaucracy
should be synonymous with order, consistency, reason, and reliability.
In order to aspire to these traits, organizations need to have specific
rules and emphasize impersonality. He noted that bureaucratic
organization much have the following characteristics:
Specialization & Division of Labor
Specific
set tasks allow employees to achieve its own objective. Thus, every
worker did not have to do many jobs, but an exclusive task that was
assigned to that worker. This helped to alleviate multiple trainings and
increase production.
Rules & Procedures
Written
policies help manage and direct the organization. Managers spend a
majority of their time on how these policies help to guide and function
in the organization. These procedures would serve as a guide and
resource for the organization.
Hierarchy of Authority
Organizations
need to have a chain of command that is shaped like a pyramid. There
are levels of supervisors and subordinates. Each worker will answer to
their corresponding superior. This would assist in having a direct line
of communication and better efficiency in the organization.
Formal Communication
All
decisions, rules, regulations, and behaviors are recorded. This
information and communication will be shared in terms of the chain of
command. Hence, everything is documented and accounted. There is no
question in what needs to be done, because it is written down.
Detailed Job Descriptions
The
organization has clear and concise definitions, directions, and
responsibilities of each position. Each worker is aware of their task
and how to employ.
Employment Based on Expertise
The
organization will assign workers in positions that would fit their
competencies. Hence, workers will be placed in the organization were
they can maximize production.
Impersonal Environment
Relationships
need to be impersonal and separate so that workers’ personal thoughts
or feelings would not affect bias or decisions. Workers just need to
work and they do not need to interact with others. Interpersonal
relationships may jeopardize the organization’s outcomes.
Weber categorized three types of authority: traditional, bureaucratic, and
charismatic.
Traditional authority is related to the backgrounds and
traditions of an environment. This leadership is usually passed down
from one family member to another without little regard to who is more
apt or capable. Thus, authority is given to another based on custom or
tradition.
Charismatic
authority is founded on the idea that the best candidate for this
position will be the one who can exert authority. This person is usually
charismatic, hence the name. If this person ever leaves the position,
then their authority does as well. According to Weber, charismatic
leaders are ones that lead to insecure and unpredictable organization
because there is a vague idea of who will replace their position.
Bureaucratic authority. Weber felt that bureaucratic was the
best way to delegate authority in an organization. Bureaucratic
authority is founded on set objectives and criterion. Hence, the best
leaders were bureaucratic leaders because they were picked in terms of
the guidelines set out for that organization’s mission. Weber believed
that bureaucratic authority was the ideal way to select authority
because it neutralize thwarted ideas of nepotism, preferential
treatment, prejudice, and discrimination. Hence, a candidate would be
selected in terms of their job competency and not their linage or
personality.
Similar
to Weber, Fayol felt that their needed to be division of labor,
hierarchy, and fair practices. Fayol believed that there were principles
of management which included:
Unity of Direction
The organization should have the same objectives, one plan/goal, and one person of leadership/authority.
Unity of Command
Employees
should get orders from only one person. Therefore, there would not be a
chain in command. One person would be the person in charge and be
responsible.
Authority
Managers
have the entitlement to provide orders and obtain compliance. No other
individuals in the organization have the privilege of power.
Order
The organization must have set places for workers and resources. These should be in the right place at the correct time.
Subordination of Individual Interest to the General Interests
The interest of the organization is most significant and not those of the group or individuals working for the organization.
Scalar Chain
There
is a hierarchical order of authority. There is a sequence and
succession to how communication is transferred from one person to the
other. This is similar to horizontal communication where workers of the
same level communicate with each other.
Even
though Fayol’s principles may appear to be strict, he was one of the
first theorists to grasp the idea that having unconditional compliance
with an organization may lead to problems. Hence, he also noted that
each organization must determine the most favorable levels of authority.
All in all, communication in the classical perspective has two functions: control and command.
Fayol believes that organizations must limit their communication to
precise and explicit words for task design and implementation. Thus,
communication is not spontaneous and is more centralized in a classical
organization.
Fayol
also believed there were certain management activities. He felt there
were five activities that are applied to the administration unit of an
organization. These activities included: planning, organizing,
commanding, coordinating, and controlling and controlling. As explained
by Fayol, planning is where managers create plans for the organization
and predict future organizational needs.
Next, organizing occurs when
organizations employ people and materials to complete their plans.
Commanding is what managers do to get the optimal output in production
and efficiency. Coordinating is where managers bring together the labors
of all of its employees. Last, controlling is to determine the accuracy
of the organization’s efforts and its plan. Fayol’s impact still has a
big influence on many of today’s organizations’ climate, structure, and
leadership.
Human Resources Theories
First
and foremost, Miles’ human resource theories posits that all workers
are reservoirs of untapped resources. Miles believed that each and every
worker comes into an organization with a variety of resources that
management can tap into if they try. “These resources include not only
physical skills and energy, but also creative ability and the capacity
for responsible, self-directed, self-controlled behavior.”Miles, R. E. (1965). Under
this perspective then, managers should not be focused on controlling
employees or getting them to “buy-in” to decisions, which are the
hallmarks of scientific management and human relations. Instead, the
primary task of management should be the creation of a working
environment that fosters employee creativity and risk taking in an
effort to maximize and tap into the resources employees bring to the
job. As such, communication in this perspective must be constant and
bi-directional and participation in decision-making must include both
management and workers. Miles explains that his human resources model
“recognized the untapped potential of most organizational members and
advocated participation as a means of achieving direct improvement in
individual and organizational performance.” Miles, R. E., & Ritchie, J. B. (1971).
Miles articulated a very clear theoretical
perspective that was high on communication, high on tapping into
employee resources, and high on employee input in decision making. These
ideas were not his, but he did create a clear categorization scheme
where he delineated between two groups of researchers whom he labeled
human relations and human resources. While Miles believes these two
groups exist, he also admits that these groups exist primarily in how
managers interpret and apply various pioneers of the field of
management, so the researchers who fall into the human relations camp
often discuss concepts that seem to fall within Miles’ own human
resources framework.
Decision Making
Douglas McGregor’s Theory X and Theory Y
The classical perspective felt that leadership
should control and order subordinates. Then, in the human relations
approach, superiors need to cultivate and support their
employees. Douglas McGregor,
a management professor at the Massachusetts Institute of Technology in
the 1950s and 1960s, felt that there are two different perspectives,
which he termed as Theory X and Theory Y. These theories were based on assumptions that managers have about their workers.
McGregor
defined a Theory X manager who believes that most people do not like
work. Workers are not smart or creative. People do not care about the
organization, and will adequately work when there are promises for
rewards and potential punishments. Moreover, Theory X manager believes
that people want to have direction in order to evade responsibility.
On the other hand, Theory Y managers feel that people want to do what is best for the organization and can direct themselves under the right conditions.
Rensis Likert’s Participative Decision Making Theory
Rensis Likert originally explored the idea of how organizational leaders make decisions. Likert’s ideas were based in the notion that supervisors with strong
worker productivity tended to focus on the human aspects of subordinate
problems while creating teams that emphasized high achievement. In other
words, these supervisors were employee centered and believed that
effective management required treating employees as humans and not just
worker bees. Likert further noted that these highly productive leaders
also tended to involve subordinates in the decision making process. Out
of this basic understanding of productive versus unproductive
management, Likert created a series of four distinct management styles.
System 1: Exploitative Authoritative.
System 1, exploitative authoritative management, starts with the basic
issue of trust. Under this system of management, the manager simply does
not trust subordinates and has no confidence in subordinate decision
making capabilities. Because of this lack of trust, all decisions are
simply decided upon by people at the upper echelons of the hierarchy and
then imposed on the workers. Communication under these leaders is
typically unidirectional (from management to workers), and employees are
motivated to comply with management dictates out of fear.
System 2: Benevolent Authoritative.
System 2, benevolent authoritative management, starts with the basic
notion that decision making should be situated with those in managerial
positions. Because managers believe that decision making should be
theirs and theirs alone, managers believe that workers will simply
comply with managerial dictates because of the manager’s legitimate
right to make decisions. This type of management almost takes on a
master-servant style relationship. As for communication, subordinates
are not free to discuss decisions or any job-related matters with their
superiors. Ultimately, employ motivation to comply with managerial
dictates is done through a system of rewards.
System 3: Consultative.
System 3, consultative management, starts with a lot more trust in
employee decision making capabilities. However, the manager may either
not have complete confidence in employee decision making or may have the
ultimate responsibility for decisions made, so he or she does not allow
workers to just make and implement decisions autonomously. Typically,
the manager seeks input from workers and then uses this input to make
the ultimate decision. Under consultative management, communication,
decision making participation, and teamwork is fair, and employees tend
to be more motivated and satisfied than the previous two styles of
management. However, consultative management can be very effective if,
and only if, the input process is conducted legitimately. One of the
biggest mistakes some managers make is to use pseudo-consultative
practices where they pretend to seek out input from subordinates even
though the actual decision has already been made. Pseudo-consultative
decision making is just a different flavor of benevolent authoritative
management.
System 4: Participative.
System 4, participative management, is built on the goal of ensuring
that decision making and organizational goal attainment is widespread
throughout the organizational hierarchy. In these organizations,
organizational leaders have complete confidence in worker ability to
make and implement decisions, so workers are constantly encouraged to be
very active in the decision making process. Under participative
management, communication, decision making participation, and teamwork
is good, and employees tend to be motivated and satisfied.
Likert believed that an organization’s
performance is based on the systems or structures in place for the
workers. Thus, Likert believed that organizations could incorporate some
aspects from the scientific management approach, human relations, and
human resource approach in order to maximize organizational outcomes.
No comments:
Post a Comment