Starbucks coupons?
Starbucks has recently begun more mass-marketing tactics that are unfamiliar to the brand. The traditional advertising of Starbucks has been for a very laid-back, cool place to stop between work and home. Starbucks was sold via work of mouth and “experimental marketing.” Starbucks has never been the type of company to use extensive marketing campaigns or coupons because, as former Starbucks marketing executive put it, “they haven’t had to.”
Starbucks is estimated to have nearly doubled its marketing spending this year to $100 million. The copy not only released its first major “broadcast-advertising blitz” during the holidays, but this past week Starbucks began an “aggressive coupon program unlike anything in its history.” The coupon campaign included distributing coupons good for free tall coffee every Wednesday through May 28th. The coupons are being distributed in USA Today, The Washington Post, and several other markets, as well as throughout New York City last week.
Starbucks is currently increasing its marketing to combat a year in which its “stock price fell by half and same-store sales flattened.” The current coupon promotion and accompanying full-page ads in newspapers are targeted at men who would rather drink brewed coffee than higher priced coffee drinks.
While some, such as McDonald’s, believe that coupon promotions increase awareness and brand loyalty, others notice the negative effects of couponing, such as a decreased brand pricing power and status.
This new coupon promotion and form of marketing could be very beneficial to Starbucks. The new strategy could be very successful in bringing in the new target of coffee drinking males; however it could also result in the more high-end coffee drinkers seeing Starbucks as more of a McDonald’s quality coffee instead of the gourmet drinks that they prefer. This could backfire on Starbucks and result in consumers becoming less willing to pay the high prices for the same coffee beverage that is available elsewhere.
http://adage.com/article?article_id=126536
posted by Sarah Kate @ 8:51 PM
3 Comments
3 Comments:
It seems that Starbucks is willing to try anything at this point. When you have a franchise on every other corner in the United States, your brand name tends to lose its allure. For me, Starbucks reached its saturation point with coffee drinkers years ago. The Starbucks in-store experience allure has been lost to smaller coffee shops that can't be mentioned in the same breath as other mega-chains such as McDonalds or Wal-Mart. However, maybe this was Starbucks plan all along. In order to claim a high position on the list of global coffee venues, a certain degree of customer loyalty has to be abandoned.
I think that it was just a matter of time for Starbucks to begin distributing coupons as part of their advertising strategy. With all of their new ideas for creating awareness, this company has probably been the most talked about brand in blog posts this semester. I think that Starbucks has lost a lot of their 'gourmet' appeal due to the mega-chain style of advertising such as coupons, but I don't think they have lost any customers.
I think the promotion that Starbucks now has is a great way to promote business, because getting millions of people into the store for a free cup of coffee will make them want to try the new coffee blend that Starbucks is now offering. They just need to be sure that what they are offering is product that people are going to like because if not, the point of capturing customers on the long term basis will fail. I actually got one of the free Starbucks coffee dark roast coupons, and a couple days late I stopped by a Starbucks to try it out. It wasn't bad, but the fact that they got me in the store, and I'm usually not a huge Starbucks or coffee drinker says a little something. I agree with Drew that Starbucks is a bit saturated in the market with stores on pretty much every corner of New York, and all over the country.(maybe world?) I still think this was a good promotion however because it will capture younger kids that don't have much money and are looking for a free handout, and gets them in the store to try the new Starbucks product. They may even get something else that they like even better, and thus starts the longer-term customer loyalty to the brand.
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