Perhaps have seen the latest Starbucks offer (it prints out on your receipt if you visit Starbucks in the morning). If you buy something before 2pm in-store, you can return after 2pm to buy any type of medium iced drink for $2.
This can be a fairly compelling offer, so I stopped to think about what they are getting from this deal and how customers benefit. Here is what I’ve come up with (if you have other comments, please add them below).
- To return and try any drink at a reasonable cost – including a more expensive drink that perhaps they haven’t tried before (let’s say a Caramel Frappucino, which is nearly $5 in LA).
- They can share the coupon with someone else – either way, Starbucks might get an extra sale in that day that perhaps they might not have gotten otherwise. (For example, I give the coupon to my husband – he’s the coffee drinker of the family.)
- Repeat or additional sales in one day (from the same customer or someone they share the coupon with).
- They might be able to build an appetite for 2 drinks per day from 1 customer (let’s say a morning coffee and an afternoon iced drink). When Dunkin’ Donuts was a client of mine, they were always trying to come up with ways to get folks into their stores for afternoon drinks/snacks in addition to the morning coffee run – that is why they branched into cookies and more drinks, smoothies, etc.
- While offering customers the chance to sample a more expensive drink, they might “help” customers see how much they prefer the more expensive option or would like to have that higher-price drink more frequently.
Keep in mind, McDonalds is pushing very hard on the coffee drink space right now – I’ve seen many outdoor ads in LA, plus many online ads too. Often, those ads mention the price of a small coffee drink to drive first-time trials. So perhaps this offer is a way Starbucks is trying to keep some of their existing business and/or grow it a bit. (Note, I have seen this promotion through Starbucks before – maybe it was last summer – so it’s not new, but the timing is interesting given the big McCafe push.)
Comments? Other angles? Have you seen other offers that drive trial? Comment below.