- United made the Starbucks investment for years, signing its first contract for it in 1995. Alaska Airlines started serving Starbucks in 2012.
- Starbucks is hardly the high end of airline coffee. I’ve had Jamaica Blue Mountain coffee on both Asiana and ANA. No doubt Austrian does the best job with coffee, certainly in business class (versus the investment in high end coffee some carriers make in first).
- A major legacy airline likely spends $5 – $10 million a year on coffee.
- Improving coffee would double the price.
- Improve operational efficiency and reduce delays, by eliminating pilots stopping at Starbucks in the terminal on the way to the aircraft.
- Improve employee morale, which in turn affects customer service. Better coffee is a product flight attendants can be proud of and reduces complaints they receive from customers.
- Coffee is especially important on high yield business routes, the ‘first flight Monday morning’ consultant specials.
Have you ever actually tried to drink the coffee on a US domestic airline? American’s new Airbus A321T flying between New York JFK and Los Angeles and San Francisco has a cappuccino machine in first class. I have only flown business class on this plane, though, so I’ve not had a decent cup of coffee on a US airline’s plane.
Cathay Pacific makes a decent cappuccino but the airline won’t serve hot drinks when the seat belt sign is on. A little turbulence on approach to Hong Kong after a long overnight flight and having no access to coffee is another form of coffee fail.
Delta got a lot of mileage out of its announced change to Starbucks this month.
I wasn’t especially impressed.
But it does suggest that branded coffee can be the sort of business decision a US airline decides makes sense.
Retired United 777 captain and airline financial analyst Vaughn Cordle offers a case for airlines investing in better coffee.
This is a big investment.
The business case Cordle makes for better coffee is multi-faceted:
Thus he concludes, “the additional costs will be more than be covered by higher earnings and an increase in firm value.”
Now, I fly American most often domestically. I won’t drink their coffee (I haven’t tried the cappuccinos in first class on the A321T aircraft, I’ve only been in the business cabin). Perhaps the fact I fly them in spite of bad coffee is a reason they don’t need to make this investment, although Cordle suggests it would have financial benefits regardless of my purchasing decisions. I know I’d love to drink decent coffee onboard… with real creamer choices.