Starbucks (SBUX): New Drinks For Coffee Haters
In a sign of self-loathing, Starbucks (SBUX) is turning to non-coffee drinks to rescue it. The coffee chain will begin selling smoothies and Italian iced drinks this summer. The firm hopes the new offerings will bring in additional customers and get old ones to visit more often.
The company claims a method to it madness. According to The Wall Street Journal “Starbucks says they’re the first stage of a broader push into healthier drink and food offerings.”
A year-and-a-half ago, Starbucks founder and now CEO Howard Schultz sent a memo to his management saying that the chain was getting away from its quaint coffee store roots. He wanted customers to smell that fresh-brewed Java when they came though the door and see the merriment among the other customers who were so happy to be there.
Instead, now Starbucks sells dozens of drinks, food, music, DVDs, WiFi, coffee makers, and washer-drier sets.
Adding goofy new fruit drinks to the Starbucks menu will not do anything to bring in enough customers to offset declines. It is simply a portent that the chain has lost its way.
Douglas A. McIntyre