SBUX - Coffee Advertising Wars

Over the next 12-months Starbucks will be forming a new advertising strategy – they have no choice. Starbucks is a great brand and the world needs to hear it. Unfortunately, this is real weakness fir the company. In fact, SBUX’s most recent AD agency told the company they don’t want to do business with them anymore.

Yesterday, Dunkin’ Donuts fired a shot at Starbucks by saying that it beat SBUX in a recent national blind taste test (for more details, visit www.dunkinbeatstarbucks.com), and SBUX has no real way of responding. I’m sure management at Starbucks doesn’t feel the need to respond, but the company needs to be on TV reassuring customers what the brand stands for.

At some point in 2009, MCD will be on TV talking about the company’s coffee initiative. Taken together McDonald’s and Dunkin’ Donuts will be spending a significant amount of money promoting their respective brands. Starbucks can’t sit on the side lines. Going forward the Starbucks brand will need to have a competitive voice in the advertising world.

Lastly a small, global coffee icon is starting to accelerate its growth plans. The Juan Valdez Cafe chain is now selling coffee at 101 stores across Colombia, as well as stores in New York, Seattle, Philadelphia, Santiago, and Spain. According to press reports the company plans to add 500 more shops across the U.S., Latin America and Europe by 2010.


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