• by Karlene Lukovitz  @KLmarketdaily, May 8, 2015

The new packaged McCafé coffee line, which began its national retail rollout in December, is seeing strong sales, according to Kraft Foods, McDonald's' licensed partner for this major launch.

"McCafé packaged coffee is performing very well in-market," Adam Butler, marketing director for McCafé at Kraft, tells Marketing Daily. "We’re extremely proud of the consumer trial and repeat to date."

In fact, McCafé is currently on track to become the biggest new product launch in Kraft's history, Butler confirms.

In previous reports, Kraft executives have said that projections were for McCafé's first-year sales to exceed the $100 million realized in the first year of Kraft's smash-hit MiO liquid beverage mix line. MiO is now an approximately $200-million brand.

Nielsen data show that McCafé had grown to a 2% share of the total coffee category as of March, and sales volume continues to accelerate as consumer awareness of the brand's availability for at-home consumption and trial of the new CPG line build, according to Kraft. 

The company also reports that the introduction of McCafé single-serve pods helped drive a 29% first-quarter increase in Kraft's overall "on demand" business — meaning sales of K-Cups and other single-serve pods, also inclusive of the Maxwell House and Gevalia brands. That performance significantly outpaced the overall on-demand category's 19% growth in the period.

The marketing push for the launch includes a television spot that will air in 30- and 15-second versions across networks nationally through second-half 2015, targeted magazine and digital advertising, FSI and digital coupons, in-store merchandising, and a McCafé at Home site housed within McDonald's' main site.

Currently, social media efforts are mainly focused through McCafé's Twitter channel. Those include product events, promotions, news and campaigns employing the hashtag #McCafeAtHome.  

The advertising creative, from DDB Chicago — McDonald's' longtime national agency — emphasizes McCafé's quality. The strategy builds on the QSR's successful in-restaurant launch of the McCafé brand as a premium, high-quality but lower-priced alternative to Starbucks and other "cafe" coffees. McCafé packaged coffee is generally priced between $7 and $8 per 12-ounce bag, versus the highest-end brands' full prices of $10 or more. 

The TV spot (screen capture above, video below) dramatizes McCafé's quality by showing two women traveling to Latin America, observing how the "100%- Arabica" beans used for McCafé are selected and roasted, tasting what Butler terms "the smooth, rich taste" that results, and learning that they can enjoy the same coffee at home.  

The digital and other ads tie in closely with the high-quality, Latin-American-origins theme. A print ad, for example, uses a "My McCafé Coffee Journal" headline, and features snapshot images of the same women who are featured in the TV spot and their experiences viewing the coffee's selection and roasting processes.