Caffeine-Fueled Movie Marathon? Starbucks Corporation (SBUX) and Coinstar, Inc. (CSTR) Have Your Back

Coinstar, Inc. (NASDAQ:CSTR) is not sitting by with its vending business with one new product. It is testing a new machine called Crisp Market, which dispenses fresh food. The initial build-out is in Chicago. I hope they have top analysts looking at the data and identifying hotspots of demand for the nationwide rollout. The other vending machine is a kiosk that sells beauty samples for $1 called “Sample It!” Only two locations exist so far, but demand seems healthy enough that more will be rolled out.

I initially thought Redbox Instant, the big news du jour, was a bad idea. When I heard the price plan come out, my opinion regarding it was immediately changed. With a $9 plan you get unlimited streaming and four Blu-ray movies from a kiosk per month. The option of heading over to a kiosk to get newer, popular movies not yet available on streaming is an enticing one.

Coffee, fresh food, and online streaming are all excellent areas to expand into. Coffee is actually a mature market now, but the Rubi mixes in some convenience and charges just $1.50 a cup of Seattle’s Best. And offering a vending machine with fresh food choices would be great for people who have short lunch breaks or want to avoid the lunch traffic.

Conclusion

Both Starbucks Corporation (NASDAQ:SBUX) and Coinstar, Inc. (NASDAQ:CSTR) are working on ways to continue growing. Starbucks is opening stores overseas, and offering more products domestically to increase sales. Coinstar is testing new kiosks, and is expanding into streaming.

Streaming is Coinstar’s biggest risk. If RedBox Instant fails to do well it could mean trouble for Coinstar’s share price due to negative sentiment, though I am not certain what the fundamental fallout would be. In the near-term, I expect limited upside and macroeconomic concerns could bring the share prices down. Both companies would require a year or two for all the new efforts I have discussed to really start paying off.

The article Caffeine-Fueled Movie Marathon? Starbucks and Coinstar Have Your Back originally appeared on Fool.com and is written by Nihar Patel.

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