Just saw this flash up on MSN and couldn’t help but wonder why it took Starbucks so long to counteract McDonald’s Free Coffee Mondays. I think this is a long overdue Starbucks Marketing Strategy to pull in the market share that can no longer afford $4 for a blended drink. I actually think the VIA Ready Brew is priced just right, given I am not a huge fan of Starbucks coffee, just its atmosphere.
The new VIA Ready Brew, which will sell for about $1 a cup, is a “transformational instant coffee that replicates the body and flavor of Starbucks coffee,” the company says.
The launch comes just as Starbucks prepares to offer “breakfast pairings” value meals.
It wasn’t very long ago McDonald’s came out swinging for Starbucks customers by offering very cheap coffee including free coffee at some stores on Mondays throughout the nation. McDonald’s marketing strategy has paid off. Profits were up 7% last quarter. With the coffee promo and people starting to count pennies, the Dollar Menu at McDonald’s has exploded. People are ditching the night out at Applebee’s for the drive-thru at McDonald’s.
It’s funny that the coffee industry is losing business to a fast food chain. You would think that there are enough intelligent people in charge of running these companies to foresee that people are now going to save money and time. Cost is a huge factor, and so is service in determining where people are going to frequent. The days of old where getting average, overpriced coffee was the “thing to do” are over.
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Starbucks Adding $1 Coffee to its menu, the new VIA Ready Brew http://tinyurl.com/d6q3q2 from: <a rel="nofollow" href="http://twitter.com/therealjosh">@therealjosh As a Starbucks fan, I'm ready!!
Starbucks Adding $1 Coffee to its menu, the new VIA Ready Brew http://tinyurl.com/d6q3q2
I imagine that Starbucks has been doing a lot of restructuring and shifting of assets and ideas as they close underachieving shops and stores, so maybe competing with Micky D's has taken a lower position on the priority list.
@Carol, I think there is some truth to what you mentioned. I think I was a little hard on Starbucks above because I have been watching McDonald's expand into the coffee scene for about 18 months now. So I think Starbucks stayed the course and stuck with it way to long even when they probably knew it was time to do something else, meanwhile they sat and watched as other seized the opportunity.
Hmmm, it won't work. IMO Starbucks should not try to compete on price, they will not win. They need to focus on what makes them unique and "superior" to McDonalds or other coffee shops.
We will just have to wait and see how it goes. For there overall brand, I think it's necessary to do something though. We have seen them shut down severel coffee shops around the world. I just wish they would open some more in my county, Denmark. Currently we only have one in our national airport
Trying to compete with McD's on price is a huge mistake. Starbuck's should reduce prices to get more market share but going $1 for $1 isn't going to work. It may actually harm their brand.
In this times that we are facing recession. I agree that everyone can't afford a $4 coffee so for me it is a good strategy that Starbucks can offer a $1 coffee so that everyone can enjoy drinking coffee even without spending too much money.
Coffee should be cheap, its only some ground up beans and hot water. Now for all those other drinks that take a little time, that justifies a slightly higher price but not $5 for a large something-or-another.