Public Relations and Marketing strategies for three major nationwide coffee chains: Starbucks, Coffee Bean and Tea Leaf, and Caribou Coffee differ. Starbucks is currently the number one coffee house chain in the world. However, other brands such as Coffee Bean and Tea Leaf (CBTL) and Caribou Coffee or fierce competitors with Starbucks in the markets where they compete with Starbucks.
PR and Marketing Strategy of Starbucks
Starbucks Coffee Company’s clever mix of marketing tactics supports the company’s industry position as the leading coffeehouse chain in the world. Starbucks uses its marketing mix as a way of continuously developing its brand and popularity with customers.
Since it has the strongest brand in the industry, Starbucks shows how effective marketing supports brand development and business growth. Starbucks has also changed its marketing mix over time, reinforcing the need for the business to evolve and maintain competitiveness.
Starbucks Coffee’s marketing mix (called the 4Ps) shows the importance of this marketing tool as a way of ensuring that the company promotes the right products at the right prices and in the right places.
Starbucks continues to innovate new products to capture more of the market share of premium coffee consumption. The following are the current main categories of Starbucks products:
- Frappuccino drinks
- Merchandise (mugs, etc.)
This mixture of products is a result of years of business innovation. For example, Starbucks added the Frappuccino line after acquiring the Coffee Connection in 1994. This aspect of Starbucks’ marketing plan involves beverages, food, and merchandise.
Starbucks offers most products through its cafés. This component of the marketing mix determines the various locations where customers can buy products. The following are the main avenues used for the distribution of products:
- Online Store
- Starbucks App
- Retailers such as grocery stores
Originally, the company only sold its products through Starbucks cafés. Through the Internet, the company now sells many of its products through the online Starbucks Store. Now, Starbucks now sells some coffee products and merchandise through retailers.
Starbucks now uses the Starbucks App to allow customers to place their orders. This part of Starbucks’ marketing mix shows how the firm adapts to changing technologies.
Starbucks promotes its products mainly through traditional advertising channels. Starbucks’ promotional strategy uses the following:
- Public relations
- Sales promotions
The company advertises through television, print media and the Internet. Starbucks does not tend to use public relations because it has not always been successful. For example, Starbucks’ Race Together public relations campaign was a failed attempt at engaging people in a national dialogue about race relations.
The company uses sales promotions like the Starbucks Card where customers can use to get free items.
Starbucks uses a premium pricing strategy. This pricing strategy utilizes the behavioral tendency of people to purchase more expensive products because of the perceived connection between higher price and higher value.
The Coffee Bean and Tea Leaf
The Coffee Bean & Tea Leaf recently rolled out its largest advertising campaign ever which focused on traditional and advanced platforms while supporting the increasing role of mobile devices in people’s daily activities.
Social platforms include commissioned Vine videos, a custom Pinterest page, Instagram crowd participation photos taken through a “purple straw” lens, online banners, Facebook advertising, and Twitter posts/hashtags via #purplestrawcam. As part of the brand’s strategy, the initiative specifically targets millennials through radio, outdoor, video, banner advertising, and sentiment-driven social media placements that invite customers to “Keep Cool and Summer On,” with the coffeehouse chain.
New methods of marketing have emerged which seek to more effectively use prospect and customer data to filter targeted lists, construct personalized advertisements, and execute marketing campaigns across the full range of media channels currently available. More successful marketing campaigns reach consumers in an orderly and consistent manner. This creates the indirect benefit of enforcing and enhancing a corporate brand. Therefore, organizations that can harness the power of other marketing channels and produce enhanced and personalized communications could put themselves in a good position to capture more market share than those companies that don’t.
The Coffee Bean and Tea Leaf lets its audience initiate the conversation on social media platforms, and is ready to respond in kind.
Caribou Coffee positions itself as a brand with a conscience, eliciting the image of wild caribou herds running through dewy meadows in Alaska. Caribou has expanded its reach, then closed some stores, only to open more store locations again. While it doesn’t have the reach of Starbucks or the marketing savvy of the Coffee Bean and Tea Leaf, its customers are loyal.
Caribou Coffee recently launched a line of premium ready-to-drink iced coffees to compete with Starbucks’ Frappuccino line of products. The company’s new coffee drinks are available in three distinct flavors: Chocolate Mocha, Vanilla, and Sea Salt Caramel. There’s seems to be a little bit of competition in terms of the quality of ingredients in Caribou’s Chocolate Mocha, which lists chocolate and cocoa in its ingredients, while Starbucks’ Mocha Frappuccino only includes cocoa as a flavoring.
Caribou Premium Iced Coffee can be found in the dairy case at grocery and convenience stores nationwide as well as at Caribou coffee shops. It should be noted as far as transparency that neither Caribou nor Starbucks produce their bottled coffee beverages directly. The new Caribou Iced Coffees are made and distributed by Dean Foods Company, while Starbucks’ bottled beverages are produced and distributed by a partnership between a subsidiary of Starbucks and Pepsi-Cola North America.
Even though Starbucks is often called the McDonald’s of premium coffeehouse chains, its marketing plan is obviously successful, because Starbucks stores can now be found all over the world. The brand’s logo is almost as recognizable as the Golden Arches.
While a Big Mac may satisfy the urge for a burger, there will always be room for those smaller burger joints, or coffeehouses, that add a more personal touch like the Coffee Bean and Tea Leaf or Caribou Coffee.