Starbucks Acquires Juice Company to Enter $50 Billion Health and Wellness Market
Starbucks today announced the purchase of California juice company Evolution Fresh for US$30m, a move it said will help it in its goal of entering the health and wellness sector.
The company said that the acquisition would “reinvent the US$1.6bn super-premium juice segment” and would be “a significant next step in entering the larger US$50bn health and wellness sector.”
With Evolution Fresh, Starbucks said it will bring a premium juice product to the marketplace by creating a differentiated brand and experience “similar to what Starbucks pioneered 40 years ago for coffee consumers”.
Leveraging its retail footprint, CPG grocery distribution channels, digital breadth and in-depth customer engagement, the company said it “believes it will be able to take a currently undifferentiated, commoditised product segment and introduce a unique, high-quality product to redefine and grow the super-premium juice market”.
“We intend to build a national health and wellness brand leveraging our scale, resources, and premium product expertise,” said Howard Schultz, Starbucks chairman, president, and CEO. “Bringing Evolution Fresh into the Starbucks family marks a significant step forward in this pursuit.
“Over the last year and a half, we have looked comprehensively at possible opportunities and chose Evolution Fresh because it stood above anything else in terms of premium quality, nutrition, and potential for growth.”
“The acquisition of Evolution Fresh supports our growth strategy to innovate with new products, enter new categories, and expand into new distribution channels,” said Jeff Hansberry, Starbucks’ president of channel Development.
Evolution Fresh was started by Jimmy Rosenberg, the founder of Naked Juice. According to Starbucks, it is one of the only actual juices left in the industry that still cracks, peels, presses, and squeezes its raw fruits and vegetables.
“Using high-pressure pasteurization (HPP) to help ensure the inherent nutrients are kept intact during the juicing process is a key point of differentiation for a growing number of our juices,” said Rosenberg, the newly named chief juice officer of Evolution Fresh.
Starbucks said that it plans to expand beyond Evolution Fresh’s current distribution into additional channels and begin making the brand’s products available in Starbucks company-owned retail stores over time. To achieve this, Starbucks said it would look to make investments over time in upgrades to existing facilities as well as expansion needed for the broadened distribution of the product and for future growth plans for the brand.
The company also plans to introduce a new health and wellness retail concept “which will further redefine the super-premium juice category and experience for consumers, unlike any existing juice retail.” It said this concept will share Starbucks’ mission and values, be pioneered by Starbucks employees, and provide a new wholesome portfolio of food and beverage offerings. The retail concept is planned for early-to-mid calendar 2012.
Based in San Bernardino, California, Evolution Fresh sells its products exclusively on the West Coast in retail stores, including Whole Foods Markets and PCC.
Evolution Fresh: A Journey of Health and Wellness
Evolution Fresh, founded in 1995 by Jimmy Rosenberg, is renowned for its commitment to providing high-quality, cold-pressed juices and natural foods. The brand quickly gained recognition for its innovative approach to juice production, utilizing high-pressure processing (HPP) to preserve the nutritional integrity and fresh taste of fruits and vegetables. This method set Evolution Fresh apart in the burgeoning health and wellness sector, appealing to health-conscious consumers seeking nutritious and convenient beverage options.
In 2011, Starbucks recognized the potential of Evolution Fresh to complement its existing product offerings and to expand into the $50 billion health and wellness market. The acquisition, which reportedly cost Starbucks $30 million, allowed the coffee giant to diversify its portfolio and tap into the growing demand for health-oriented products. Since the acquisition, Evolution Fresh has continued to thrive under Starbucks’ ownership, benefiting from increased distribution channels and enhanced brand visibility. The partnership has enabled Evolution Fresh to maintain its core mission of promoting health and wellness while scaling its operations to reach a broader audience. Evolution Fresh remains a crucial player in the juice industry, and it is celebrated for its dedication to quality and innovation in natural foods and beverages.
Bio of Starbucks
Starbucks, founded in 1971 in Seattle, Washington, has grown from a single coffee bean store to a global coffeehouse powerhouse. The company was initially created by Jerry Baldwin, Zev Siegl, and Gordon Bowker, inspired by Alfred Peet, a coffee-roasting entrepreneur. In 1987, Howard Schultz acquired Starbucks and shifted its business model to sell coffee beans and brewed coffee, opening the first Starbucks café. Schultz’s vision transformed Starbucks into a coffee culture icon, offering a “third place” between home and work where people could relax, socialize, or work. This shift propelled Starbucks into rapid domestic and international expansion, making it one of the most recognized and respected brands worldwide.
Today, Starbucks operates over 30,000 locations globally, serving various coffee drinks, teas, snacks, and other beverages. The company’s success is attributed to its consistent innovation, such as introducing the Starbucks Rewards loyalty program, mobile ordering, and expanding into new product lines like Evolution Fresh juices. Starbucks is also committed to social responsibility, focusing on sustainable sourcing of coffee beans, ethical business practices, and community engagement initiatives. The brand’s emphasis on quality, customer experience, and corporate responsibility continues solidifying its position as a leader in the global coffee industry.