'Pairing' program debuts at Starbucks - Fox29 WFLX TV, West Palm Beach, FL-news & weather

'Pairing' program debuts at Starbucks

Posted by Rachel Leigh email

(WFLX)- The gourmet coffee chain that's been losing business at quite a clip of late unveils plans for its first value menu: $3.95 will get you a latte with coffee cake or drip coffee with hot sandwich.

Consumer savings, in some cases, will exceed $1.20 per order. The food and drink "pairing" program, which Starbucks actually refuses to call a value menu, rolls out March 3. (See pairings below)

It will be offered all day at company-owned U.S. stores. It will be marketed as: "Hello to a New Day".

The move, something CEO Howard Schultz vowed he would never do, comes at a time when the coffee giant is spiraling down.

Starbucks, once the model of the new economy, has been concurrently hit hard by three powerful forces: a recession, changing consumer habits and growing competition from fast-food chains.

The $3.95 deal includes one of four hot sandwiches, currently sold at half of Starbucks' U.S. locations, and a tall, drip coffee. Also, offered for that price is a tall latte and either a slice of cinnamon swirl coffee cake or a bowl of oatmeal.

The move by Starbucks is glaring evidence of how retailers and marketers have been forced by the economy to rethink game plans and long-held strategies.

Additional price-cutting is expected at Starbucks soon. "The most important definition of value is the one our customers have," says Terry Davenport, marketing chief at Starbucks. "In this environment, it's about everyday affordability."

Hard to imagine these words coming from the kingpin of pricey gourmet coffee.

But the times demand it, says KD Paine, a marketing consultant. "Starbucks doesn't have a choice. If you don't have a stimulus program built into your marketing, you're in big trouble."

The business environment is unlike any Starbucks has ever experienced.

In late January, the chain said that sales at U.S. stores open at least a year fell a stunning 10 percent in its first fiscal quarter while net income dropped 69 percent.

It also announced plans to shutter 300 additional stores and cut as many as 6,700 jobs.

McDonald's, which has McCafé coffee bars at half of its U.S. stores, says it's bemused at Starbucks' value move. "Value has, and will always be on the menu at McDonald's," spokeswoman Danya Proud says.

Starbucks pairings include:

Tall Handcrafted Caffè Latte paired with:

  • Starbucks Perfect Oatmeal, 100% whole grain goodness made-to-order with three conveniently portioned toppings, including dried fruit, nut medley and brown sugar; or
  • Reduced-Fat Cinnamon Swirl Coffee Cake, a moist buttery cake with a cinnamon swirl center topped with a cinnamon crumble.

Tall Fresh Brewed Coffee paired with:

  • NEW Artisan Bacon Sandwich, a flavorful bakery-style sandwich made with a parmesan egg frittata, smoked bacon slices, and Gouda cheese on a perfectly-baked hand-shaped artisan roll; or
  • NEW Artisan Ham Sandwich, a delightful combination made with a parmesan egg frittata, three slices of Black Forest ham, and mild cheddar on a perfectly-baked hand-shaped artisan roll; or
  • Sausage Breakfast Sandwich, a tasty teaming of sausage, egg and mild cheddar on an English muffin; or
  • Reduced-Fat Turkey Bacon Breakfast Sandwich, lighter option featuring reduced-fat turkey bacon, cholesterol-free egg, and reduced-fat aged white cheddar on a multi-grain English muffin.
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