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October 2009

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The moment i read "To support the Via launch, Starbucks will be promoting a “taste challenge” in its own stores"

I has an idea Starbucks is make a stupid mistake...I Won't be better marketer than Starbuck's mgmt, BUT I KNOW WT IS RIGHT. I WONDER WHY THEY MAKE MISTAKES????

Giant

I have tried Via it's good for instant, but still tastes like instant. It's not going to fool people who enjoy good brewed coffee. at $1.10 per packet it makes a 8oz cup for $2 i can buy a 16oz cup of high quality brewed coffee? I can also grind my own beans at home and make a quality cup of coffee for about 50 cents. Who are they targeting with this? and how many can there be. Maybe it's a guy with lots of money who works in an underground mine 8 hrs a day who can't leave. All he has down there is a hot water tap and cup.

microgaming

Great post!! I think starbucks is losing his way here… instant coffee is not their business and I don’t think they will get a lot of customers with it. If I want to enjoy coffee at home I got much better coffee with a lower price. If I go to starbucks is to enjoy a beverage with my friends and spend some time there, actually I would buy anything if they didn’t brew coffee

Marketing Plan

Hi,

Yes today most of the businesses failed, because no one gave importance to learning; only having a good idea is not always enough. Learning is the everlasting process. Whatever big is your brand and name.

I totally agree with you, it is not necessary if you have a solid idea then you will succeed. There are so many things you have to look when you are introducing new product, just having an good idea is not enough, you need to have knowledge and strategies and proper strategy execution is far important then just having a strategy under your belt, and most crucial part is you have to craft yourself according to the needs of the market and without learning its not possible.
I personally like your post; you have shared good insights and experiences. Keep it up.

John Verdano

Laura, isn't Tide Stain Release the same story? They were always saying that "detergent alone is enough" and you don't need any additives and now they came out with such additive (Tide Stain Release)?

Any opinion on this snafu?

Accounting Dissertation

Blogs are so informative where we get lots of information on any topic. Nice job keep it up!!

Dr Wright

I gotta wonder about that. I dont want Starbucks instant. I am going for the experience, I can make good coffee at home for less. More money and less experience???

Dr Wright
http://www.wrightplacetv.com

Tubosun Abioye

Starbucks will simply attract new customers for this new low end product and loose old customers in its old high end product. Simple!

Geoff Dillon

Alot of the folks in line at your local Starbucks are buying anything but coffee. These are Starbucks' premium clients, who are spending $4 a pop on a "beverage", not a coffee. No matter how good Via is (or isn't) these folks will still be there.

While I think Starbucks will fail in getting people to believe Via is as good as brewed coffee, their positioning could convince consumers that it's the best by far among instant coffees -- which begs the question, is that worth anything to them? Will we see Via alongside Taster's Choice in the grocery store soon?

Glenn Friesen

Hard to believe, since their early branding was based around "the experience of drinking Starbucks coffee". After the introduction of chilled coffees in Vons and vending machines, and the new drive-thru Starbucks locations, I thought that the giant mermaid had done a great job killing that brand value. But now with the introduction of the instant coffee alternative, I'd say that my former opinion was ruled a little too early. A brand falling apart through extension? You tell me. What's apparent is that their about the product now, and not the service.

Yaacov Weiss

Starbucks campaign is sooo bungled, it’s astonishing. If this product is mapped to a completely different consumer occasion (as one commenter put it), why are they be having taste tests in their stores? All they’re doing is convincing loyal customers that it’s no longer worth coming in here!
-To coffee aficionado’s, which is Starbucks primary target, equating instant to freshly brewed is a sin. Why would they create a marketing campaign that rubs their primary target so wrong?
-Starbucks was built on the notion that the “coffee experience” is fundamentally more special than just plain coffee. Why are they now directly contradicting everything they always stood for?
-How does a modern name like “Via” synthesize with “Starbucks”. According to Starbucks website the name Starbucks is in honor of “the coffee-loving first mate in Herman Melville's Moby Dick, and because they thought the name evoked the romance of the high seas and the seafaring tradition of the early coffee traders. The new company's logo, designed by an artist friend, was a two-tailed mermaid encircled by the store's name.”
If they wanted to create a product for a different consumer occasion, then they should have made a campaign like “When there’s only time for instant, there’s Via” and keep instant as a lower tier option.

Fred Tompkins

I don't think you have done your research or even much thinking, Al. The price per serving of this Starbucks instant product is not much less than a 8 oz (short) cup of brewed coffee. An argument that Starbucks has created a much cheaper offering that will draw people away from its stores just seems wrong on its basic merits.

I think this is a product mapped to completely different consumer occasions than the retail experience. I would compare it to having California Pizza Kitchen pizzas in the grocery store. Or...another example--2 liter bottles of soda are priced very similarly to 20 oz bottles--go to your local grocery store and check it out. The soft drink companies make tons of money on the small packages. People simply have different shopping algorithms for different occasions.

People have proven that they will pay a premium for the overall retail coffee experience. I would bet that will not change--I would bet that if we check back in six months, you will be proven wrong. Perhaps embarrassingly so.

Tom Wanek

Well, at least they didn't name it, "Starbucks Instant Coffee"

Jim Hayes

Starbucks is generating media attention and foot traffic to their stores with the VIA promotion (seems to be working). The majority of people who order drinks at Starbucks do not order regular coffee so there really isn't a threat of losing anyone or diluting people's perceptions of the brand. It is possible to taste the difference but if you like McDonalds you probably won't be able to. The Italian Roast VIA does beat a lot of office swill served up in companies around the U.S. and VIA is perfect for camping trips and times where you can't actually head into a Starbucks, Caribou, or other coffee shop.

Allan

Spot on analysis.

I've been a big fan of Howard and the Starbucks brand experience. I thought his return to the helm would be a good thing for the company. If this strategy works, I'll be really surprised.

How do you transfer the whole store "experience" with the ambiance, baristas, and sights and sounds in a bag of instant coffee?

Bill Cross

Laura, I know you're not a big fan of licensing, but consumers understand the "at home" and "eating out" occasion as TOTALLY different. You don't just go to a Starbucks for Joe, you go for the ambience, to sit and read, or to have SOMEONE ELSE make your coffee. And while Via claims to be as good, I wonder (having never tasted it) if it's not a case of "nudge, nudge, wink, wink," with Starbucks saying it's AS GOOD, when in reality, it's never going to equal the in-store experience.

mark rukman

al you're missing the big picture here. starbuck's understands that it's not the most premium brew on the block, that more of it's sales will come from packaged goods eventually than will come from their stores. via is ensuring that it's quality. it's not cadillac's cimmaron, it's expanding user occassions and the type of consumer. and while we're on cars, mercedes makes a c-class, and e-class and an s-class, sure is the c-class a bit for strivers of course and it's a car for a younger buyer. when i see a 50 year old in a c-class, i think bit of a loser, couldn't afford what you really wanted, when i see a 30 yr old in a c-class, well i guess this is your first in a long line.

starbuck's is getting smart and building their business

greg

Errr, "latest"? It's been out for six months already.

The only difference is that they are now trying to renew marketing interest in it by pushing it out to markets they didn't care enough about the first time around.

Odd that we're talking about it all over again after hashing over it six months ago. I suppose by that fact, their marketing strategy is working.

Arthur Charles Van Wyk

Brilliant analysis as always.

Starbucks, being a mega brand, should look at expanding thru innovation and not extension.

Same company. New brand. Same distribution channel. New customer.

That's what the approach should be.

www.facebook.com/profile.php?id=580332546

When I saw Starbucks come out with Via, I knew that you would be posting on this topic.

Starbucks is doing to itself what Cadillac did to itself in the 80s by introducing low-end Caddies to grab market share. All it did was help Lexus & Mercedes solidify their market leadership at the high end.

What they fail to understand is that there is no more market share to grab under the same brand using the same advertising and distribution methods they have been using.

Diluting the brand may bring in a few more people, but it will also drive loyal customers away.

I tried Via. As Jay Leno recently said," 'Via' is an ancient word for 'Sanka'", and I agree.

Erik Johnson

My thoughts exactly...

http://marketinglawsdaily.com/blog/2009/09/30/starbucks-instant

The Clover is the new coffee option that should be advertised. Great post!

twitter.com/MP_PriceCom

instant what?!? bull. focus on the brand and everything will take care of itself. i can't believe starbucks is losing focus AGAIN "via" product.

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