The Lane Train

News and Pop Culture for the Blog Generation

Starbucks Saved?

Posted by thelanetrain on August 13, 2008

I’ve been following Starbucks’ tumultuous summer through store closings and crazy new drinks, but now the Seattle-based megachain has been trying an idea that many consider novel for the company long associated with fancy drinks and insultingly high prices: offering discounts.  With high profit items like iced lattes, macchiatos, and frappucinos being sold for only $2 plus tax, who wouldn’t want to take advantage of these steal prices for yummy drinks?

After The Jump: The “Treat Receipt”, how it works, and what it means for Starbucks

What is it: The “Treat Receipt” is a customer receipt that acts as a coupon allowing the customer to order any iced grande drink for only $2 plus tax.

How it works: Customers who purchase drinks or goods at Starbucks are encouraged to hold onto their receipts.  After 2pm that day, the receipt can be redeemed for a discounted iced beverage.  Ideally, it’s aimed towards regular morning customers who would normally want to go back to Starbucks in the afternoon for something cold, but choose not to because of the high prices associated with the drinks.  This way, the morning customer can come back and receive a discounted cold drink, or pass the receipt to a friend for the discount.

Why it’s good: This is a major step for Starbucks.  While the brand is as universal as ever, it has long been associated with high prices and a sense of pretense.  By offering the discount, it tells regular customers that they’re welcome back and that Starbucks appreciates their loyalty.  Furthermore, It also gives consumers the opportunity to try new menu items that they would normally be discouraged to try due to the price.  Lastly, it creates more afternoon foot traffic in the stores (comparable to the AM rush), and with lower prices, consumers will naturally tend to buy more drinks.

Why it’s bad: The promotion seems like a short-term event, and many speculate that Starbucks probably will not continue this in the long run.  Also, in a nation of overweight adults, is practically giving away fattening frappuccinos a smart idea for a nation’s ailing health?  Fiscally, reduced prices have the potential to lead to further losses by Starbucks (they reported their first quarterly loss last fiscal quarter), but so far, no slowdown signs yet except for that and the store closings.

The bottom line: Just accept and give in.  When else can you get a $5 frozen drink for more than half off?


One Response to “Starbucks Saved?”

  1. Where did you get your blog layout from? I’d like to get one like it for my blog.

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