Starbucks Weathers the Economy

Starbucks is a company that, unsurprisingly, is highly affects by the poor economy and slow job market. Their product is all about “excess,” and as consumers continue to tighten their spending, the morning lattes are one of the firs expenses to get crossed off the list. However, the company is trying to let consumers know that they can have value products as well, and that you don’t need to be rich to afford their products.

Howard Schultz, Image: Newscom

The company had an annual investors’ meeting in Seattle today, and the auditorium was packed with people wanting to know how the coffee company would survive the current economy. Chief Executive Howard Schultz pointed out that over half of their offerings are under $3, and they have a new coffee/breakfast sandwich combo for under $4. Still, for people on a budget, you can get a lot more for you buck at fast food restaurant or even a local diner.

Schultz insisted that their core base isn’t being lured away by fast food coffee and their major competition is consumers who are now brewing their morning cup of java at home. They’ll be continuing to try to rebrand their products as affordable, not luxury, and they’ll be reintroducing promotions this summer so that patrons who purchase coffee in the morning come back for a second cup in the afternoon.