Starbucks is moving to unlock new demand with a second brand this week: Seattle’s Best.  At first blush, this may not seem particularly different.  But, if you read the company’s announcement on Tuesday, Value Innovation thinking jumps off the page in the form of the much maligned coffee vending machine.

We know how bad these things can be from hospital visits, factory break rooms and car dealer waiting areas.  So, a key component of the “re-birth” of the brand is by creating a new kind of machine that will deliver a better coffee taste and experience.  Other potential Value Innovations:  they will also be stocking convenience stores (where there is no major national brand across over 100,000 stores), kiosks and lunch trucks.   Additionally, Starbucks will be adding  franchise stores to try to stall Dunkin Donuts rapid expansion.

Essentially, Starbucks, with only 4% of the domestic market for brewed coffee, sees huge possibilities for regular folks who just want better coffee.  Between Via (instant coffee), the rapid expansion into grocery and mass merchandisers and this new Seattle’s Best rollout, is there another consumer brand company as active as Starbucks right now?

In their revamped recovery strategy, Starbucks is moving their Via instant coffee product out of their stores and onto the shelves of a mass merchant near you.  The WSJ reports that creating a “very significant consumer packaged goods business” is a “centerpiece of their new growth strategy.

Starbucks as the “third place” was a dramatically successful Blue Ocean Strategy. We reported that the Via launch also qualified. It was much more than a brand extension because it opened a new front for instant coffee, an old, boring category known for its bitter taste. Research indicated that a majority of adults under the age of 40 had never tried instant coffee. Starbucks reinvented this category by discovering that non-customers who could not afford a $4 latte, did not have time to stand in line or did not enjoy the Starbucks “conversation” experience would consider drinking an easy to brew Starbucks product in their office, home or on the road.

But Starbucks will face new challenges as they attempt to capture a Blue Ocean grocery market, specifically distribution. It’s a different game than they are used to playing.  For now, they are going solo, chasing the upside of more profits.  Don’t bet against a rejuvenated (recaffeinated?) Howard Schultz as he understands the power of creating Blue Oceans to make the competition irrelevant.