11 Marketing Tactics You Should Steal From Starbucks

by garyasanchez

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Starbucks secret iced tea menu launched via Instagram

Starbucks Secret iced tea menu[/caption]Starbucks Secret Menu Launched via Instagram[/caption]

Full Disclosure:  I used to be the Retail Marketing Manager at Peet’s Coffee & Tea and I often looked for ways to steal ideas from our much larger competitor, Starbucks.

*NOTE:If you're not a regular Starbucks customer, "Grande" is one of its cup sizes.

Many people give Starbucks credit for revolutionizing the coffee industry.  The truth is, Starbucks was among a number of coffee chains that realized a better tasting cup of coffee could be brewed with Arabica beans instead of the more commonly used Robusta bean found in the likes of brands such as Folger’s, Hills Brothers, MJB, Maxwell House, & Chase & Sanborne.

Where I believe Starbucks can rightfully claim it led the industry was in emphasizing the coffee bar experience over the coffee bean experience.  Whereas earlier pioneers such as Peet’s focused on selling beans, Starbucks focused on selling cups of coffee.  Starbucks also chose rapid expansion which gives it the illusion of being the category pioneer. 

Early marketing evaluations noted that Starbucks created a comfortable place away from home where customers could relax and spend leisurely time sipping coffee and chatting with friends.  At that time, Starbucks referred to its goal as becoming the “third place” (e.g., home + work + Starbucks).  Today Starbucks has evolved to still support customers sipping coffee but instead of chatting with friends, they are staring at their computer and mobile phones with free wi-fi.

Consumers emotionally connect with brands when the brands repeatedly provide something that the consumer wants, desires, or needs.

~Stanley Hainsworth

As a business, I’m far more impressed with how smartly Starbucks has learned to operate its stores than supposedly revolutionizing the coffee category.  Instead, I believe it’s close to having revolutionized retail operations and marketing.  It’s no small feat to have a long history of consistent same-store sales growth year after year (as it does).   Averaging that across almost 24,000 stores is extra impressive.

Even as a global retail business, you can learn a great deal about how to implement effective Local Business Marketing Tactics by evaluating Starbucks.

Based on my own observations, these are the nine top marketing tactics you should steal from Starbucks to implement in your own local business:

1) Hire people-people over coffee-people – You can train most people to learn any job, whether it’s as a barista, or working a drive through window, or making change at a cash register, but you can’t always train a person to be friendly.  Starbucks has developed a reputation of having a welcoming environment for all of its customers and that starts with hiring a friendly crew of people-people.  I once spoke with a Starbucks manager about my experience working as a Marketing Manager at Peet’s Coffee and I said Peet’s hired me only after learning I was a big coffee fan.  This Starbucks manger told me, “we prefer to hire people-people over coffee-people.”

2) Ask your staff to learn the names and preferences of customers – As Dale Carnegie wrote in his famous book, How to Win Friends & Influence People,

"Remember that a person's name is, to that person, the sweetest and most important sound in any language… We can make people feel extremely valued and important by remembering their name."

~Dale Carnegie

Make it a training goal and create mechanisms to make this easier. Starbucks does this at most stores by writing the names of customers on cups.  It’s also a stated training goal to have all new baristas to remember the drink orders of its regular customers. 

[SIDE STORY] I used to order a double short latte at my neighborhood San Francisco store every work day.  While nobody ever greeted me with a “Good Morning Gary”, a good 4 or 5 years after I regularly ordered that drink, I walked into a different San Francisco Starbucks (miles away) and the barista greeted me with a “Double short latte?”  She had remembered my face and drink several years later.

‚Äč3) It trains baristas to personify the company Mission Statement – The stated mission of Starbucks is “To inspire and nurture the human spirit – one person, one cup and one neighborhood at a time.”  Tactics #1 and #2, when combined with exemplary barista training that includes how to interact and connect with customers as much as it includes learning drink recipes and how to operate the espresso bar.  These actions create employees who almost naturally nurture the human spirit and personify the company’s mission.  

4) Always have something new to share – Starbucks launches several new products over the course of any given year.  In the Summer of 2016 alone, it has launched new flavors and new drinks such as: Teavana Shaken Berry Sangria Herbal Tea, Iced Coconut Milk Mocha Macchiato, Vanilla Sweet Cream Cold Brew, Caramel Waffle Cone Frappuccino, S’mores Frappuccino, and three flavors of granitas.

5) Upsell, Cross-sell, and upsell– It’s practically second nature to have a barista take your drink order and ask if you want food to go with that.  I’ve visited several stores where it held informal Cake pop Fridays.  At these stores, the baristas were challenged to sell as many cake pops as possible which almost always precipitates an upsell attempt.  While cake pop Fridays are usually upsell programs created by store managers, Starbucks corporate also creates creates products that are natural upsells.  Also launched in Summer 2016, the Affogato-Style Frappuccino is added espresso shots over an already expensive drink.

6) Bundle sell – This summer, Starbucks offered an $8 bag lunch  that included one of its panini sandwiches, a bag of chips, a piece of fruit or a fruit bar and a bottle of water.  Surprisingly, it did not include a coffee or tea drink as part of the bundle.  The fast food industry has long sold combo meals as a way of increasing the average ticket per sale.  Starbucks knows a good revenue building opportunity when it sees one.

7) Run PromotionsFrappuccino Happy Hour, or as customers would call it, Frappy Hour invited customers (and prospects) to enjoy Frappuccinos for half-off prices between the hours of 3-5pm.  If I were to guess, this promo helped increase store traffic and bring in customers who weren’t necessarily regulars.

8) Always be testingWhile I cannot definitively distinguish between a “regular” new item launch and a “test” new item launch, three examples strike me as having been more on the testing side than on the promotion side.

  • It rolled out dessert trifles in two flavors: Chocolate Brownie and Strawberry Shortcake.  These were a shmoosh of food ingredients such as a brownie, whipped cream and chocolate drizzle;
  • Additionally, Starbucks “launched” a secret menu of colored flavors of tea  on its Instagram page and on Good Morning America as part of a secret menu (and from what I heard didn’t train baristas how to make every flavor in advance). Based on these social media posts, customers entered stores ordering the #PinkDrink or the #PurpleDrink;
  • At select stores, Starbucks has installed a Clover coffee system which, in my humble opinion is a made up way to assert a better (and proprietary way) to brew a cup of coffee. Where I see the ingenuity in this program is that it is being used as the only way to brew a cup of Starbucks’ Reserve Coffees.  The system is used to brew cups of its Reserve Coffees, which typically sell upwards of $40 for a 8-ounce bag (1/2-pound) and reportedly about $0.50 a cup more expensive than its more common drip coffee varieties;
  • Back in 2015, Starbucks generated a lot of publicity based on its instructions to baristas to write the phrase “Race Together” on customer cups as an attempt to create dialogue around race relations in the U.S. 

9) Treat your best customers preferentially – The Starbucks Rewards program is a phenomenally successful way of getting customers to pre-purchase its products.  Customers can load dollars onto its card and earn points for purchases.  Its card can also be used as a mobile phone app.  Some of the benefits Rewards card holders get include mobile ordering which lets members pay in advance and have an order awaiting them at the store plus free birthday drinks, extra points for specific purchases, etc.

10) Merchandising mattersMost Starbucks stores take full advantage of promoting new and special drinks on both sandwich boards outside of stores, as well as on the centerpiece merchandising space of its menu board.  

Starbucks Menu Boards

Starbucks Menu Board = Great Merchandising

11) Offer a strong guaranteeStarbucks policy and guarantee to customers is that "Your drink should be perfect, every time. If not, let us know and we'll make it right."  I’ve seen baristas dump perfectly good cups of coffee down the sink and make up a replacement order without batting an eye.

As I mentioned earlier, the financial performance of Starbucks over the years has been nothing short of impressive.  

Starbucks Impressive Comp Store Sales Growth History

Starbucks Impressive Comp Store Sales Growth History

This is true especially when you compare the numbers to other notable U.S. retailers.

WalMart &B Target Same Store Sales Trends

WalMart &B Target Same Store Sales Trends

But with the exception of building a custom loyalty mobile app, none of these tactics are beyond the reach and capabilities of any local business.  

Wouldn’t you like to have a similar performance with your retail store or local business?

“If you want to be successful, find someone who has achieved the results you want and copy what they do and you'll achieve the same results.”~Tony Robbins

I say get out there and start using these tactics and lessons from Starbucks.

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