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Night and Day, Starbucks Grows Up as a Global Lifestyle Brand

Posted by Dale Buss on December 20, 2012 04:59 PM

When you're a lifestyle brand and not just the logo on some commodity product, you've got to meet and ideally exceed customer expectations. In three arenas around the world, Starbucks is confronting both the challenges and the opportunities in having customer bases that expect more out of it than they do other brands.

In its home turf of Seattle, in addition to Washington, D.C., Orange County, CA and a handful of other locations around the United States, Starbucks finally is addressing customer expressions of a desire for the chain to offer a broader menu than mainly coffee, tea and pastries — and that entails Starbucks creating an evening ambience to match its achievements with other day parts.

A potential answer is Starbucks Evenings, a test concept that has been quietly piloted over the past year. After 4pm daily in these locations, the store flips to a menu offering a selection of wines, beers, various small plates (such as truffle mac and cheese), salads (baby arugula with fresh basil and pickled beets, anyone?), sandwiches (such as fire grilled chicken with goat cheese) and even desserts.

The Starbucks Evenings section of its website highlights its food and drinks menu, as well as the locations currently offering it. Its coffee and tea beverage menu will still be available, of course, but there won't be full restaurant table service.

Meanwhile, in Japan, customers now are focusing on the coffee at Starbucks, in part because the chain ordered its outlets to reduce the amount of drip coffee it pours into each cup by about one-third of an inch. Starbucks said this is to address growing customer complaints that the coffee at higher levels splashes too easily on them and doesn't leave enough room for milk.

That's all well and good, except that some Japanese customers instead see a ploy by Starbucks to squeeze more revenues and profits out of this new practice. The company has raised prices three times since 2006, bucking Japan's endemic deflation. At least, some suggest Starbucks could cut prices if it's going to cut the amount of coffee in a cup.

And in Europe, Starbucks continues to face the music over paying little taxes in the U.K., even after volunteering to pony up an additional $16 million a year more in each of the next two years than it's required by law to pay. At a time when fiscal austerity is sweeping the world, Starbucks' olive branch is seen by critics in Britain as not enough make-up, given how little U.K. taxes it has paid over the years due in large part to sophisticated (if legal) tax-avoidance measures.

Given what Starbucks wants to mean to its customers, such may be a new phase in corporate responsibility. According to The Economist, other companies are being targeted as well. It's part of the new price for brands to function in an austere world.

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