Five years ago that might have passed for the opening line in a bad joke, but the Seattle-based coffee titan plans to tout its ‘Starbucks Evenings’ concepts featuring wine and beer across the US in 2014.
The move could also lend opportunities to US craft beer and spirits brands, since Starbucks could seize the opportunity to localize its brand by sourcing from, in the case of beer, the nation’s 2,483 craft breweries.
Mintel’s global drinks analyst Jonny Forsyth suggests as much in a company blog post that dissects a move that Starbucks has trialled in 26 US test markets over the last three years, but plans to extend to 40 stores nationwide by the end of 2014.
Forsyth said the shift to a “more adult” style served to better differentiate the chain from fast food and doughnut chains placing coffee at the core of their proposition, and fitted CEO Howard Schultz's recently revealed ambition to double the firm's current market capitalization to $100bn.
“Café bars can provide Americans with a more flexible drinking location where they can flit between coffee, soft drinks, food and alcohol, or just eschew alcohol altogether,” Forsyth writes.
Will Starbucks opt for craft brands or big beer?
“While many US bars offer non-alcoholic beverages, their heritage and culture dictates that they are primarily seen as places to drink alcohol,” he adds.
“Starbucks provides a less masculine and ‘safer’ drinking environment – especially for women – but also for contemporary drinkers who are seeking more balance,” Forsyth says.
We asked Forsyth whether he really believed Starbucks would prefer local, craft beer options to mass brands from the likes of Molson Coors and AB InBev.
"Starbucks has intimated in press releases and in an interview with Bloomberg that it will vary the alcohol drinks offering to 'local taste preferences'," he told BeverageDaily.com today.
Analyst predicts Starbucks will 'go high' with prices
"If they do go down the craft route, it will be tricky organizationally and mean that they will lack the scale from national products. However, I think it is worth it. Craft brands are thriving in the US at present and I suspect Starbucks will go high with their prices (I've heard $7 for a glass of wine being bandied about as a figure), meaning margin should not be a problem," Forsyth said.
"In my view, the only downside to Starbucks’ incredible US growth story is that it has made the brand so big that it has become a very homogenized brand experience, and craft spirits, beer and wine are a perfect way to re-connect with local communities and regain the brand's social cachet," Forsyth added.
Conquering the evening cocktail set
Bethany Wall, foodservice analyst at Mintel, writes in the blog that Starbucks wants to balance the lower check averages of ‘to go’ orders demanded by ever busier patrons, with Starbucks Evenings programs – backed by community events like poetry readings – encouraging customers to linger and spend more.
“By combining its menu offerings, décor and entertainment, Starbucks is able to create an experience that cannot easily be duplicated by competitors, which places the chain back on top as a foodservice destination,” Wall adds.
Finally, Stacy Glasgow, Mintel’s consumer trends analyst says that Starbucks was playing into a movement whereby trusted brands across all categories are trying to extend their reach.
“Starbucks isn’t merely broadening its line with a new product offering. It is expanding into an entirely new consumption occasion and will take on an entirely new, secondary role for customers,” she says.
“As Starbucks seeks to conquer the evening cocktail set, it’s crucial that the brand maintain consumer confidence in its overall offering so as not to undermine its quality and reputation,” she adds, in the Mintel blog post that you can read in full here .