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Starbucks Turning To Advertising To Pitch Value Messages

Starbucks, which built its business on word-of-mouth, is about to unveil a "long term, multi-million dollar" advertising campaign that will focus on "the quality, value, and the values that Starbucks offers," Jonathan Birchall reports. In particular, it will battle the perception that its products are too pricey.

"We're doing a very good job of starting to demystify the fact that Starbucks coffee does not cost $4 as people are charging us with," says Howard Schultz, who resumed the CEO position early last year. He says that customers who are opting to take their java at fast-food eateries such as McDonald's and Dunkin' Donuts "know that they are compromising and I know that's going to play well for us in the future."

Comparable sales fell by 8% during Starbuck's second quarter, following last year's 9% drop, owing to a 5% decline in the number of customer visits and a 3% decline in average transactions, the company reports.



Read the whole story at Financial Times »

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