Starbucks Introduces Starbucks® Natural Fusions Naturally Flavored Coffee in Grocery Stores Nationwide

Today, Starbucks Coffee Company (NASDAQ:SBUX) announced its latest innovation in packaged coffee– Starbucks® Natural Fusions, the industry’s first and only nationally-branded naturally-flavored premium coffee made with real ingredients, such as vanilla, cinnamon and nutmeg, ground and blended in with the coffee. Starbucks® Natural Fusions is made with high-quality ethically-sourced arabica coffee beans perfectly blended and specifically roasted to complement each flavor variety and delivers the taste of Starbucks® coffee consumers expect with just the right amount of flavor. The new coffees– available in vanilla, caramel, and cinnamon- will be available in 11 oz. packages for the suggested retail price of $8.99 in the U.S. where groceries are sold starting in June.

This latest innovative product introduction is part of Starbucks overall business strategy for growing its Global Consumer Products business and comes a year after changing the way consumers think about instant coffee with Starbucks VIA® Ready Brew. The Starbucks CPG business, which increased 4 percent to $180 million in the second quarter of fiscal 2010 and includes packaged coffee, ready-to-drink beverages and premium ice creams globally, is one of the driving forces behind the Company’s long-term strategy to extend high-quality coffee products beyond Starbucks stores.

"We’ve taken our 40 years of expertise in roasting and blending the highest-quality coffee in the world and applied it to the concept of flavored coffee,” said Annie Young-Scrivner, global chief marketing officer for Starbucks. "Starbucks has had a successful packaged coffee business in the grocery aisle for more than 10 years and this, in part, is because we listen to our consumers, of whom nearly 60 percent enjoy flavored coffee.* These new coffees provide the Starbucks® coffee taste that people expect with just the right amount of flavor and will deliver on our promise of a quality cup of coffee.”

More than 11 percent of American households** purchase premium flavored coffee, making it a $265 million business in the U.S. alone.*** Until now, Starbucks has not entered the premium flavored packaged coffee category, as it was imperative to create a naturally-flavored coffee that highlights the same robust, full-flavored taste Starbucks® coffee lovers are accustomed to enjoying. By starting with a blend of Latin American beans and real ingredients, Starbucks was able to create a naturally-flavored coffee that is perfectly balanced and accented by vanilla, caramel, and cinnamon notes.

"When we began to look at creating a naturally-flavored coffee that would live up to the Starbucks name, I thought about how we could apply the art and techniques of blending Tazo® teas to our high-quality coffee,” said Tom Jones, director, Starbucks Beverage Research and Development and former master tea blender for Tazo. "After working for years blending Starbucks® coffee with real botanicals and spices, we were able to create the perfect blend of coffee, real ingredients and natural flavors resulting in a delicious naturally-flavored coffee we could be proud of – Starbucks® Natural Fusions.”

Each flavor of Starbucks® Natural Fusions, while delicious on its own, is recommended with cream and sugar, the way approximately 80 percent of American coffee drinkers enjoy flavored coffee.

• Starbucks^® Natural Fusions Vanilla is the perfect pairing of Starbucks® coffee with the subtle taste and indulgent aroma of vanilla.
• Starbucks^® Natural Fusions Caramel pairs the rich buttery flavor of caramel with Latin American beans, dark roasted to perfection.
• Starbucks^® Natural Fusions Cinnamon combines the full, spicy aroma of cinnamon with the rich flavor of dark-roasted coffee.

For more information, please visit www.Starbucks.com.

About Starbucks Corporation

Since 1971, Starbucks Corporation has been committed to ethically sourcing and roasting the highest quality arabica coffee in the world. Today, with stores around the globe, the company is the premier roaster and retailer of specialty coffee in the world. In addition to its Starbucks retail stores, the company produces a wide range of branded consumer products globally, including ready-to-drink beverages, packaged coffees and premium ice creams. The company’s brand portfolio features Starbucks Coffee, Tazo Tea, Seattle’s Best Coffee and Torrefazione Italia Coffee, enabling Starbucks to appeal to a broad consumer base. For more information, please visit us online at www.starbucks.com.

*AC Nielsen Panel (Note: includes flavored coffees and flavored creamers)

**AC Nielsen Panel

***AC Nielsen (Note: 3-outlet, excludes Walmart and Club)

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