« What Starbucks told employees about Wednesday's earnings report | Main | Starbucks customer claims there was a rusty nail in his breakfast sandwich »

April 30, 2009

Comments

Feed You can follow this conversation by subscribing to the comment feed for this post.

Andrew

I love it!

Bearista

I love that we are doing this!!!!! GO Starbucks!

pApI NEWS

Starbucks to take aim at inexpensive rivals
New ads don’t mention McDonald’s, others, but deride ‘cheap’ coffee
The Associated Press
updated 7:44 p.m. ET, Thurs., April 30, 2009
NEW YORK - Starbucks Corp. on Thursday posted four ads on its Web site in a sneak peak of a new multimillion dollar marketing campaign meant to take on lower-priced rivals in the gourmet coffee market.

The ads, which will begin running on May 3, do not mention any competitor explicitly, but clearly attempt to keep customers from switching their allegiance to players such as McDonald's Corp. McDonald's is rolling out a new line of espresso-based drinks to all of its 14,000 U.S. restaurants.

One print ad tells consumers to "beware of a cheaper cup of coffee," adding "it comes with a price." Another warns customers that "compromise leaves a really bad aftertaste."

Other ads focus on what Starbucks has long said makes the company stand-out from other coffee retailers — the quality of its beans and its customer service.

In a video posted on the Web site and addressed to the company's employees, Chief Executive Howard Schultz called the ads "a little tongue in cheek," and said the company will be "very clear and very purposeful that the time has come for Starbucks to tell its story."

On Wednesday, Schultz said on a conference call with investors that the Seattle-based chain will launch the marketing campaign to focus more on value and the quality of the Starbucks experience.

The comments came after the company reported its fiscal second quarter net income fell 77 percent, mainly due to charges related to its cost-cutting campaign. The company's adjusted profit rose slightly and beat Wall Street analyst estimates by 1 cent per share.

The company's same-store sales, or sales at stores open at least a year, fell 8 percent both worldwide and in the U.S.

Copyright 2009 The Associated Press.

pApI

"a little tongue in cheek," and said the company will be "very clear and very purposeful that the time has come for Starbucks to tell its story." By Chief Executive Howard Schultz

Theres a lot to tell Howie, where do you want to start?? I'll hold my cheek and you can just put it in nice and slow!!!

Thought of the Day

"Starbucks or Nothing. Because Compromise Really Leaves a Bad Taste in your Mouth

Compromise? "They did compromise.....it's called Pike Place Roast.... And that really does leave a bad taste in your mouth.

sbux nrd

i want those posters framed and in my kitchen!!

pApI

Just to let everyone know I'm chewing on this new Valencia Orange Cake which contains Almonds-Got some Regs so my pairings a bit off but the little orange cake packs a punch, it's very soft and chewy and Almonds are a nice touch, tasty, not sure if it will come w/out nuts...

I recommend but with some better green(White Rhino perhaps) and some Casi Cielo this pairing should be perfect with this NEW Valencia Orange Cake....

suenderc@fe

From a customer point a view, the ads are soft on the eyes and provide an equally soft message except for the "Beware". Should I be afraid before I spend my money at Starbucks? Perhaps removing the words "Beware of" would still convey the same message.

Focusing on service, the experience, and "Old School" Starbucks are key ingredients to bringing back those who wandered off and found new places to get their daily caffeine fix.Bring back the education of coffee, the interaction with customers, and the excitement that used to come from one transition to the next.

Supahvisah

seriously though, why tease us with a valencia cake, just bring back that damn syrup already.

Pet

For Reals, Supahvisah!

Mysticboi

"net income fell 77%"

I find that pretty funny and I think they are gonna give us back alittle bit more labour. I am also very happy to see that Starbucks finally makes the decision to advertise. Woot woot!

coffee drinker west

avoid the noid

oh that's been used already

Hard Opinion

Just watched the Youtube video with Howard and the Baristas about the ad campaign.

Questions:
1.Were those Barista's hand picked and briefed on what to say? It's hard to believe that those comments were spontaneous!

2.Were they given those black shirts with Starbucks logo's on them just for the video? Most staff have to buy shirts with logo's on them - Starbucks, unlike other companies who are proud of their logo and want their staff to look smart and uniform, give their staff shirts. It would be hard to believe that they actually all paid for their shirts! So, next question

3. Why not give all store partners shirts with logo's on? Promote the brand - its all advertising!

Melody - reply to Hard Opinion

@Hard Opinion:

I just re-watched the video in light of your comment above.

The truth of the matter is that it looks like a totally genuine video. Those partners are those partners. Very real. And I thought baristas often bought the logo t-shirts? I always see a ton of partners in logo t-shirts in downtown Seattle? Maybe that is a function of being so close to the SSC?

In any event, going back to the video: Nothing looks scripted. In the first part of the video Howard is in the Pike Place store and in the background you see the former store manager Corrine working in the background. She is such a sweetie! You can see her bending down to reach something and she can't do that very well because she is very far along, and holds her belly. She's very cute! I think she is temporarily no longer the manager of that store due to a maternity leave. ?? By the way, over Corrine's head in the background, you can see chalkboards where there used to be a whole bean menu that got removed within the last month. This is definitely very recently filmed.

Link in my name goes to an MSI thread about the whole bean menu at 1912 Pike Place. I'm disappointed that it is gone considered the special historic status of that store. If any store deserves a whole bean menu, that one does.

Then as the baristas speak, they sound just like the baristas I know. Mike, from the Pike Place store loves his manual machine and he has made me many a doppio con panna in a for-here cup. (My confession here is that I miss chocolate whip because it was so fun on a doppio con panna).

Nicole and Jessica have made me many Clover cups of coffee. They're very real, and I don't think anything was scripted or coached.

The one funny thing is that I've been into the Pike Place Store a million times either quickly before work (or over lunch while eating at the Market for lunch) and I'm trying to recall if I've ever met "Wade" before. I guess I miss him all the time! LOL

That's downtown Seattle. By the way, as an aside, literally 90% of all my brewed coffee problems come after normal business hours Monday through Friday. Mon - Fri I drink drip in the morning, and Clover coffee in the afternoon, but weekends are just totally unpredictable because I'm often not near a Clover, and the brewed coffee situation becomes even more unpredictable on the weekends, it seems.


pApI NEWS

Starbucks ad campaign is gutsy, but can it work?
It's a fine time to be telling people not to spend less on coffee.

But that's just what Starbucks is doing in a new ad campaign that includes the slogans, "Starbucks or nothing. Because compromise leaves a really bad aftertaste," and, "Beware of a cheaper cup of coffee. It comes with a price."

"Lots of companies small and large have kind of gone to school on us, telling their story at the expense of Starbucks'," Schultz said in a video filmed at two Seattle Starbucks stores and posted on the company's Web site. "The time has come for Starbucks to tell its story."

The time may have also come, it seems, for Starbucks to hit back at McDonald's. Taking full advantage of America's new-found frugality, the fast food company launched an all-out assault on Starbucks' prices when it released a line of specialty coffees last year.

It's a gutsy move by Starbucks, considering what side the economy is on. But maybe it'll work. Starbucks has been working to expand its drink and food options and give discounts to loyal customers, even launching a new line of instant coffees. And it's not like things have been going great for the Seattle-based company. Still smarting from layoffs and store closures last year, Starbucks reported a quarterly drop of 77 percent this week (though revenue fell just 7.6 percent).

Another slogan from the campaign reads, "This is what coffee tastes like when you pour your heart into it."

What do you think? Can this campaign work?

Posted by Monica Guzman at May 1, 2009 10:27 a.m.
· Return to Starbucks ad campaign is gutsy, but can it work?

pApI

@ Mel

I don't want you to take this the wrong way but the VIDEO is totally scripted and rehearsed to put it nicely, if you know the people or not, the fact is it was planned and filmed with directives and thats just not nice now is it!! Sorry MEL U'r sipping on some tangy KOOL-AID :(

Melody

LOL - Okay pApi, maybe you're right. Who knows! I can admit that occasionally I get a little too intoxicated on extra bold kool aid. I probably needed a strong dose of the hair of the dog that bit you for that kool aid hang over.

Melody

@pApI - I'm going to retract my post from 5-1 at 10:01 pm (though it is still true that I sometimes get intoxicated on extra-bold kool-aid). I was just in that store and lucky me but several of the partners featured in that video were on the floor this morning. I won't say who I talked to but at least the portion of the video that was filmed in the Heritage Starbucks while seated at the table was NOT scripted. You guys may think I'm crazy, but I am sure of that now.

NYCSHIFT

I don't know anything about scripted or unscripted. I say who cares? Does it work?

I think it does. Has anyone seen our stock, it's almost doubled since the beginning of the calendar year. Whether it's Howard's video or something else everyone is using to inspire them lets keep it going. I need a new car!

Melody

Amen NYCSHIFT! :-)

pApI

Don't be naive your both SMARTER than that...C'mon Mel there not going to tell you that it was planned out with direction...meaning it was discussed before hand as to how to act and talk etc...Please tell me you are not falling into "The Starbucks Black Hole'!!!

CamSpi

The video looks & sounds genuine to me.
Who's seen The NY Times ad? I like the text they added about our relationship with farmers, what makes the Starbucks roast special, and the baristas. But I still think that they need to gear they're ads towards the youth, too. TV ads with images that show our support centers in action, that have heartfelt testimonials from customers and baristas. The younger generation isn't necessarily going to flip through the business section in the Sunday paper. Our future customers should learn about our values, too!

Melody

[quote]But I still think that they need to gear they're ads towards the youth, too. [/quote]

That's funny you should say that CamSpi because there is an MSI thread by someone named frogdad2002 (I have no clue who that is) whose big complaint is that the ads are too youth oriented.

http://mystarbucksidea.force.com/ideaView?id=087500000005MlbAAE

http://preview.tinyurl.com/frogdad

^ Short link to the same MSI thread

frogdad2002 says the ads should be more "age appropriate". I'm like, huh? Honestly, I didn't see the ads as geared in anyway towards one age segment or another. As you can see, frogdad2002 is getting voted down! LOL

CamSpi

I don't think the messages are geared towards one demographic necessarily, but I do think that them putting the ad in the business section of the New York Times isn't aiming towards the teens-mid twenty's.

Bea

The print effort is weak and only speaks to Starbucks small and irrelevant marketing budget. Talking about the company's core beliefs only resonates to the top customers who ARE currently visiting the company. Yes traffic continues to decline. The print effort is small and stupes. We need a new marketing chief officer.

NYCSHIFT

I think the images are geared towards no one in specific, however who is the average Starbucks' customer? They are white, educated persons making about 90,000 dollars a year.

We cater to the upper-middle class, and what better way to reach them than the New York Times. It's the easiest, and cheapest to hit your core demographic, so I say kudos to the Starbucks marketing team for knowing that.

I like the ads in general. I do wish there were less words. I don't think many people will take the time to read all of it, and I wish there were a coupon somewhere in it.

Fork me, I'm done

Why would a DM ask to pull any remaining NY Times from our rack on the publication of 05/04/09. The DM specifically cited the Starbucks advertisement on page A5 but wouldn't elaborate on why. Anybody have something to share?

Hit back

I know this is supposed to be a brand campaign that lasts a couple years, but we need to hit back a little harder NOW. Start the TV spots and lets get going already!!! NYT ads are too focused. We want new customers in our stores!!!

me

i think these adds are stupid, senseless, and typical of every epic fail in marketing they've done.

These do not tell our coffee story.

"Cheaper coffee comes with a price" Yeah, that conveys value. "Sure our coffee costs more than theirs, but you're really paying in other ways."

Worse marketing ever. Epic fail!

Melody

I just had a thought - maybe these ads aren't about the ads at all. Maybe the idea here is just to create a buzz about Starbucks. Get people talking about Starbucks. ?? So it doesn't matter if it's isolated to NY Times if you're just trying to create a buzz???

@nycshift - I quoted you below. I suspect that the annual income of a Starbucks consumer is dropping. Lowest common denominator effect. Thousands of stores, more customers, wider range of products. Furthermore, the recession probably is having some downward pressure on the typical Starbucks customers' income. Wonder what the current demographic data looks like.

My random observation: Though once in a while it seems like the people who can least afford the most expensive drinks (high schoolers - obviously limited or no income) are the ones buying the most expensive beverages (frappuccinos). On the other hand, it seems like the higher-earners want smaller latte beverages or coffee. No scientific data here, just a random observation by Melody.

[quote]I think the images are geared towards no one in specific, however who is the average Starbucks' customer? They are white, educated persons making about 90,000 dollars a year. [/quote]

CamSpi

So, Starbucks recently held a contest on their twitter: the first few people who posted twitpics of their ads in the real world won gold cards....
earlier i criticized that starbucks wasn't targeting enough young people, but i believe that they're trying now... so i take back my comment.

former partner

Stupid. Why not focus on why Starbucks coffee is better. Or focus on the clover. Or promote the coffee being "ethically" grown. Feature a farmer who benefits from the extra $$ customers spend. To me Starbucks, by this kind of add campaign is putting themselves further into the pile of fast food places out there. This add campaign reinforces the idea they are snotty and does nothing to set them apart as a great company. I miss the old Starbucks. I really thought Howard would turn things around.

adam hartung

Starbucks is rapidly losing its position as a market leader. By choosing to go toe-to-toe with McDonald's Starbucks takes on a battle it cannot win. A bad management decision - which should have remained focused on the entire value proposition and not just coffee. Read more at http://www.ThePhoenixPrinciple.com

Verify your Comment

Previewing your Comment

This is only a preview. Your comment has not yet been posted.

Working...
Your comment could not be posted. Error type:
Your comment has been saved. Comments are moderated and will not appear until approved by the author. Post another comment

The letters and numbers you entered did not match the image. Please try again.

As a final step before posting your comment, enter the letters and numbers you see in the image below. This prevents automated programs from posting comments.

Having trouble reading this image? View an alternate.

Working...

Post a comment

Comments are moderated, and will not appear until the author has approved them.

Search Site

Ads (2)