Rohit's nukkad

Tuesday, August 05, 2008

Starbucks offers iced grande for $2

Yes you read the blog title right. Starbucks is going to offer any iced grande beverage for $2 across US. Looks like Starbucks is making all efforts to lure back customers after slower growth rate for the past couple of months.

But before you rush to get your grande Caffè Vanilla Frappuccino from Starbucks there is catch in the $2 beverage offer. Firstly, the offer is available after 2 pm and secondly it is available ONLY to customers who pay a morning visit to Starbucks and are able to reproduce the receipt from the morning visit.

Now is this a smart business move, I would disagree with the Starbucks management team.

The idea behind the strategy is to bring back regular customers to Starbucks in the afternoon by luring them with half priced cold beverages. But this is on the assumption that people are going to keep track of their morning receipts and would make an extra trip to Starbucks to get there trophy drink of $2.

The problem lies in Starbucks drastic expansions made in the late 90s and early 2000's with goal to multiply its stores in the process losing on the its market value. Starbucks needs to think on long term strategy rather than thinking of short term ridiculous marketing gimmicks.

More about the Starbucks $2 iced beverage offer click here