Tully's puts own spin on coffee drink

In typical copycat fashion, Tully's Coffee is launching a bottled version of its dairy-based coffee drink that looks a lot like bottled Frappuccino.

Called Bellaccino, the 9.5-ounce bottles will be available beginning next week at QFC, Fred Meyer, Haggen, Bartell Drugs and convenience stores in Washington, Oregon and Idaho.

The Tully's product arrives on grocery shelves a decade after Starbucks launched bottled Frappuccino, which was so popular that it sold 10 times what was projected in the first few weeks of distribution.

Bottled Bellaccino comes in three flavors — coffee, mocha and vanilla — and costs $1.89 for a bottle or $6.99 for a four-pack. The chain has sold ice-blended coffee beverages called "Spin" in its coffee shops for years; they were renamed "Bellaccino" in June.

Tully's executives say the bottled drinks could represent a "multi-million-dollar opportunity" for the struggling coffee chain based in Seattle.

They believe Bellaccino will win customers who have been uninspired by other bottled coffee drinks, including Wolfgang Puck Gourmet Latte and Folgers Jakada.

"Nobody else with a store base of premium coffee houses has tried it," said Mark DaCosta, Tully's vice president of wholesale operations and the product manager for bottled Bellaccino.

Bellaccino labels prominently feature the Tully's name. Some customers will know the brand from its chain of 117 retail coffee locations and from its coffee beans, which are sold at grocery stores in 25 states.

"In the trial, people were really thrilled by this product," DaCosta said. "Given how we've positioned ourselves in the retail marketplace, we believe the trial will repeat itself."

Some Frappuccino competitors have had trouble with distribution, he said, a problem he considers solved by using Portland-based Columbia Distributing. Pepsi-Cola distributes Frappuccino in the United States.

Tully's roasts the beans used in Bellaccinos, but the drinks are mixed and packaged by a private-label manufacturer that Tully's would not name for competitive reasons.

Consumers buy sweetened coffee drinks to indulge themselves, said Jarrett Paschel, director of consumer and retail trends for The Hartman Group, a Bellevue-based market research firm.

He doubts Bellaccino will create a big stir, though, partly because the drink loses some appeal in bottled form and partly because it is so similar to Frappuccino.

"I don't think people are going to be that excited about a couple [of] different coffee choices, especially since they've replicated the Starbucks product," Paschel said.

The prepackaged liquid coffee market is worth more than $500 million, according to the market research firm ACNielsen.

Convenience stores represent the largest share, with $332.4 million in sales over the past year. Sales reached $230.7 million at grocery stores, drug stores and mass merchandisers like Kmart.

Tully's would like to snag 10 percent to 15 percent market share in the Pacific Northwest over the next six to eight months, and plans to sell the bottles in more states beginning next year.

The name "Bellaccino" comes from the Italian "bella" for "beautiful" and the "cino" in cappuccino.

It has a handy resemblance to the Frappuccino, which got its name from a different product sold by a Boston coffee chain that Starbucks bought in 1994.

Since its first store opened in 1992, Tully's has mimicked Starbucks with product offerings, product names and, for many years, by opening stores adjacent to Starbucks to make money in the giant's shadow.

Now, Tully's hopes Bellaccino will do beautiful things for its bottom line, which has been drowning in red ink for years.

Last year, the chain posted a profit because of the $17.4 million sale of its Japanese stores to a licensee — money it is spending to create bottled Bellaccino and otherwise revive itself.

"This is one of many initiatives that are part of Tully's strategic plan for growth," said Rob Martin, vice president of merchandising and production. "This is the next one that's been checked off the list."

Melissa Allison: 206-464-3312 or mallison@seattletimes.com