Ten Million Dollar Cup

April 9, 2018
Ten Million Dollar Cup

Starbucks has been working on sustainability from “bean to cup.”  Now they are focusing on the cup.

Unsatisfied with their results on an environmentally friendly cup design, Starbucks has turned outside of their firm with a $10 million dollar challenge.  Partnering with Closed Loop Partners, the goal is to develop the next generation coffee cup that skips the landfill and either decomposes or is recycled.

The problem is that over 600 billion coffee cups are consumed each year.  Starbucks alone uses over 6 billion.  Because of the plastic lining used in the current design, the cups are difficult to recycle and take approximately 20 years to decompose.

This doesn’t fit with the company’s corporate sustainability goals.  In 2010, Starbucks set a goal to have 100% of its cups being reusable or recyclable by 2015.  They didn’t achieve this goal.  Only a handful of cities can recycle their cups, and only 10% of the cups’ material is from post-consumer recycled fiber.

Thus, the $10 million challenge has been announced to move their sustainable cup goals forward.

This post is based on the MSN/CNN article, Starbucks offers $10 million for ideas on a better cup, by Aaron Smith, March 22, 2018. Image sources: Design Pics / Leah Warkentin and Getty Images/iStockphoto.

Discussion Questions

1. Why did Starbucks look outside its doors for a new coffee cup design?

Guidance:  Obviously, internal progress was not meeting their goals.  Starbucks does have a research and design team, but its 200 member team is spread across many areas in the company.  Utilizing outside expertise is one way to leverage cup development.  Offering $10 million in grants in their NextGen Cup Challenge is one way to focus attention on this issue.

Additionally, this is a splashy way of promoting their sustainability goals and accomplishments.  See Starbucks’ Social Impact page for more information on various social responsibility goals and accomplishments.  This helps Starbucks to be one of the most admired companies in the world.  They are ranked the fifth Most Admired Companies by Fortune magazine, and number one in the Food and Beverage industry for 2017.

However, if they want to continue to be the most admired, they need to solve the coffee cup problem.

2. How should someone go about finding the best coffee cup for Starbucks?

Guidance: Answers should consider the product development process with emphasis on the early phases.  Specific attention focusing on idea generation would be important considering that there has not been much success in this area.  Focus in the design process should be on the 3 R’s—reduce, reuse, and recycle.

3. What are alternatives to a new coffee cup?

Guidance: One way would be to reduce the use of travel coffee cups and move toward reusable cups.  You could encourage customers to bring their own cups.   Starbucks currently offers a discount for bringing in a cup.

In London, Starbucks is in a trial to charge a 5p premium for using a Starbucks cup.  This is similar to the problem that grocery stores have with their grocery bags—paper or plastic.  Neither is ideal from an environmental perspective.  But reusable bags are a possible solution.  The key is getting customers to use them on a regular basis.

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