Starbucks says oatmeal is most popular food launch

Tue Sep 23, 2008 2:07pm EDT
 
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By Lisa Baertlein

SEATTLE (Reuters) - Starbucks Corp's newly-introduced hot oatmeal is the coffee chain's single most popular food item and its most successful food product launch to date, a company executive said on Tuesday.

"It is the single highest volume (food) item in our history," Michelle Gass, senior vice president of marketing at Starbucks, said in a meeting with journalists.

Gass said the instant oatmeal is the "hero" of its new health-oriented breakfast menu launched in early September, but that other items are contributing to rising ticket sales for food.

"We have seen the entire food business lift," she said, adding that margins on oatmeal are among the highest of all of its food items. Starbucks serves up the breakfast staple with mixed nuts, dried fruit or brown sugar.

"We believe we have hit a home run," Gass said.

Starbucks executives also said that 4,000 U.S. stores will have warming ovens for sandwiches and pastries by the end of September, up from 3,200 on March 31.

The company will also roll out new breakfast sandwiches and seasonal items by September 30.

Starbucks gets 75 percent of its sales from beverages. Items like food, merchandise and whole bean coffee account for the remaining 25 percent, with food leading the category.

(Reporting by Lisa Baertlein)

 
<p>People walk past a Starbucks store in New York, July 3, 2008. REUTERS/Chip East</p>