Friday, January 25, 2008

Starbucks-for-a-Buck. What's that all about?

For openers, I have to admit that I rarely drink anyone's coffee, let alone Starbucks' coffee, which I really don't like the taste of. (Some people I know claim that one of the reasons that Starbucks junks up its coffees with the latte-sugar-whatever stuff is to disguise that taste.)

As for coffee, sometimes I have a cappuccino - generally when I'm out to dinner or am taking a walk in Boston's North End and stop in at the Caffe Vittoria for a cannoli and to play oldies on their juke box.). Sometimes I drink iced coffee (generally from Dunkin' Donuts).

When I do go into a Starbucks, mostly it's to meet someone. I really do enjoy the coffee house ambience, and laud them for that (although, quite snobbily, I'd always rather spend my time and money in a stand-alone, non-chain place like Caffe Vittoria or Athan's Bakery in Brookline, Massachusetts).

Once a summer, or so, when I'm in a calories-be-damned mood, I have been known to indulge in a Frappaccino. Although when I'm in that kind of mood, I'm more likely to indulge in a Mochaccino at DD. (While I give Starbucks props for providing places to hang out in many of their stores, I'm just more of a DD kind of girl. Maybe it's that they're local, and I grew up with DD. Every Sunday, after Mass, my father would stop in at the DD in Worcester's Webster Square, just down the street from our church, and pick up a dozen donuts. Or two.)

Wherever I am, I mostly drink tea.

Which is a long-winded way of bringing up Starbucks testing an 8-oz. cup of joe that will retail for a buck. (In typical Starbuckian fashion, the 8-oz.-er has a cutsie name. It's called a "short.")

As reported in the Boston Globe the other day (Following up on an article that appeared in the prior day's WSJ),Starbucks is facing some caffeinated competition from McDonald's and Dunkin' Donuts, which offer premium (and frou-frou) coffee for less than the $2 or so something similar costs at Starbucks.

While the company issued a statement that their small gulp "short" is "not indicative of any new business strategy," you've got to ask yourself just what it is.

As a tactic to recession-proof themselves from regulars who might start questioning the wisdom of spending large for a "grande", I can't imagine that it's going to work. Someone who's become addicted to the Starbucks' experience is probably not going to feel relieved and grateful that they can keep buying there without spending big bucks. I'm guessing that they're going to feel short-changed, miffed, and tiny bit humiliated. (Now all the world can see: I can no longer afford to buy my coffee at Starbucks.)

They may already be doing this, but what might work better to secure their base is the buy-10-get-1-free cards that some places employ. (Two that I frequent are Cosi, where I buy salads for lunch a couple of times a week; and Copley Flair, a small local card store chain where I buy all of my greeting cards, not just because they carry a good selection, but because I get my card punched each time I buy one.) Loyalty programs do work.

As a tactic to bring in new customers, I can't imagine that this will be a big draw for McDonald's or Dunkin' Donuts patrons who like the coffee they're getting there just fine.

Last year, Starbucks' Chairman Howard Schultz warned against Starbucks "'watering down' its brand." More recently, he stated that the new offerings Starbucks has been coming out with aren't "'exciting'" enough.

The short strikes me as both watering down the brand and as decidedly non-exciting.

Is anyone over at Starbucks listening to their own Chairman?

1 comment:

Seth said...

Actually, 'Short' is the standard name for an 8 oz coffee around the world. Short is the normal size coffee, with the Tall 12 oz being a large. Starbucks has had the 8 oz size all along, primarily using it for shots of Espresso, but they haven't had it on the menu.