Ideas percolate at Starbucks

Articles
February 07, 2012

Ideas percolate at Starbucks

The coffeehouse chain attempts to knit new food and beverage appeals to its distinctive culture.

Starbucks – and supermarkets – will soon find out if blondes have more fun.

We aren’t referring to the hair color of coffeehouse baristas, but to Starbucks’ new lighter roast coffee (dubbed “blonde roast”) long sought by consumers who find the brand’s signature roast too intense. Starbucks claims this is “a billion-dollar opportunity…in the U.S. alone” because most supermarket coffee sales occur in the light and medium roast segments.

It also aims to make further inroads with packaging organized by roast type, intended to simplify purchase decisions at the shelf and capture some of the 25% of shoppers who leave the supermarket coffee aisle without making a purchase.

Starbucks has sought to develop opportunities in its own stores as well, where the experience matters as much as the product – and where, along with wi-fi, the potential to sell more kinds of products can make it a more appealing destination for more customers. To that end, the chain says it will:
•    Offer wine, beer and premium food (savory snacks, small plates, and hot flatbreads) in select Chicago, Atlanta and southern California stores by the end of 2012 – to help customers relax in the evenings and build off what it learned in some of its Seattle and Portland stores. The wine and beer list will reflect local tastes and preferences.
•    Test the markets for health foods and premium juices, since it bought Evolution Fresh. The idea, analysts told the Los Angeles Times, is “to create hip, fun juice shops that will transform juice much the way the company did with coffee.” The intent is to go national and position the stores for health and wellness, Starbucks CEO Howard Schultz told analysts.
•    Continue to focus on the upcoming Christmas season many months in advance – with consumer surveys, music CDs, seasonal flavors, cups and décor from its 80 in-house designers all in the mix to help maximize sales during the holiday quarter, which approached $3 billion in the 2010 period, described a Bloomberg BusinessWeek account.
•    Sustain its social media leadership. While all major coffee chains performed well in social media this past year, Starbucks came in first with 89% “enthusiastic opinions,” according to Amplicate’s tracking and analysis.

The Lempert Report is watching the chain attempt to remake itself as a more convenient destination that gains more food trips and appeals to a broader base of customers – all while retaining the culture that has made it distinctive.