Starbucks Corporation got a mighty and growing rival, an Italian IllyCaffe SpA, which is successfully taking over the US premium coffee market. The Trieste-based corporation signed agreements with around 30 independent coffee shops, many of which are located in traditional Starbucks area, and is going to win one hundred more all around America in coming 3 years — not only in the USA, but in Canada and Mexico as well.
The Illy brand provides each coffee-shop from “its” chain with high-class Italian espresso machines, fine crockery, bright artwork, as well as exclusive recipes and staff training programs. In return the brand wants the cafés to be loyal and sell only its products for 3 at least years. The Illy company believes that the US consumers are ready for new things and that’s why it is confident of the brand’s success.
Now the company has 10% of the $48 billion of international retail gourmet coffee market, while the Starbucks’s share is much bigger (11,000 outlets in the US alone). But Illy doesn’t have to pay extra money for renting or buying cafés, as Starbucks do, so the Italian brand’s expenses are lesser. Who knows, maybe in ten years the two brands with be equal in terms of popularity.