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bassexpander
Joined: 13 Sep 2007
Location: Someplace you'd rather be.
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 Posted: Fri Dec 12, 2008 5:00 pm Post subject: McDonalds taking on Starbucks: "Four Bucks Is Dumb" |
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This is interesting. For those who have to get that shot of coffee, McDonalds is cheaper. I've found myself in this situation from time to time. When my wife shop in COEX, we often go to BK to get cheaper coffee and avoid the insane prices at the Coffee Bean and Starbucks there. We save about 3,000 won each.
http://seattlepi.nwsource.com/business/391566_sbuxrivals11.html
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Starbucks won't slug it out in ad wars
Coffee chain says it'll take high road
By ANDREA JAMES
P-I REPORTER
McDonald's has erected a billboard in sight of Starbucks headquarters declaring, "four bucks is dumb."
If Dunkin' Donuts' taste test commercials were the schoolyard equivalent of blowing spitballs at the coffee giant from afar, then the latest from McDonald's is like pulling a wedgie. Starbucks employees driving northbound can see the billboard on their way into the city.
Another billboard slogan jabs, "large is the new grande." The two phrases are displayed on 140 billboards in Western Washington, some of them near Starbucks cafes.
"The billboard placement was done because we picked high visibility locations," said Alan Finkelstein, who owns four McDonald's in King County. "We really wanted to point out that ordering an espresso at McDonald's is quick and simple. Small, medium and large. It's easy."
Earlier this year, McDonald's started unsnobbycoffee.com to promote the launch of espresso drinks in the Seattle market.
Will Starbucks respond in kind? Unlikely.
While the coffee wars received much media and Wall Street trumpeting this year, Starbucks has been mostly silent, maintaining that its customer base is different.
Starbucks could fire back that not all of its coffee costs four bucks, or that extra cents help pay for health care for baristas. (A 12-ounce cup of brew starts at $1.40 at Starbucks, a penny more than the average McDonald's brew price. A small McDonald's latte costs $1.99 compared with $2.45 to $3.15 at Starbucks.)
Instead, it is fighting back in a more subtle way. Executives have hinted that Starbucks is taking the high road.
"We get a lot of questions on the competition and that everyone seems to be picking on Starbucks through their advertising and try to reposition Starbucks as expensive or snobby, and, boy, when is Starbucks going to start advertising and join in that coffee conversation?" Starbucks Chief Marketing Officer Terry Davenport told investors last week in New York.
"We're not going to get into that conversation. We're not going to get sucked into the, 'My coffee is better than your coffee,' price point type of coffee conversation. We're going to play at a much higher level."
Starbucks is relatively new to the advertising game after two decades of building its brand on word of mouth. However, armed with newly hired advertising agency BBDO New York, Starbucks placed two commercials recently. One, which ran during the "Saturday Night Live" show before Election Day, advertised that Starbucks would give out free coffee Nov. 4.
The second ran on the heavily traveled Wednesday before Thanksgiving, on the Weather Channel and CNN, to let customers know that Starbucks would be donating portions of coffee sales to help African AIDS victims.
The coffee giant also is turning to cheaper modes of advertising via YouTube, Facebook and Twitter.
During an interview that aired this week with CBS anchor Katie Couric, Starbucks Chief Executive Howard Schultz made clear his feelings about one of the rivals.
"I think the way we deal with that is not to respond to something that's that frivolous," he said. "Are you going to say to your friend, 'Let's go meet at Dunkin' Donuts?' Are you going to say that?"
He pointed out the "Saturday Night Live" advertisement as a success. "We had an amazing response to that. Amazing."
More insight into how Starbucks' top brass really feels about McDonald's and Dunkin' can be found in ousted Chief Executive Jim Donald's severance agreement, in which he was prohibited from working for either competitor, but was permitted to work for Burger King.
Even though Starbucks won't play along publicly, it's still fun to pick on the company, said consumer anthropologist Robbie Blinkoff, who studies consumer reaction to the financial crisis.
"It's even more fun now with the economy," Blinkoff said. "I'm back and forth about my love, hate with Starbucks. I love to hate them."
A new type of consumer, more conscientious, less vain, is emerging. Fewer will be "slaves" to Starbucks, he said.
"We're going to come out with a new identity. It doesn't mean that people won't go in and buy a Starbucks cup of coffee, but they'll know why they're buying it again. It's more like a reboot."
The advertising campaigns against Starbucks signal a shift in the rules, especially when a corporate behemoth such as Oak Brook, Ill.-based McDonald's goes after a company half its size.
The commonly held wisdom that attack ads are an underdog's game no longer applies, said Emily Bryson York, a Chicago-based food reporter for Advertising Age.
Attack ads are popular right now: Mac vs. PC. Campbell's vs. Progresso. Dunkin' vs. Starbucks.
"A big part of this is the economy and marketers feeling like the economy is in horrible shape, people have fewer discretionary dollars and you have to sharpen your elbows," York said.
McDonald's is trying to build up its coffee credibility.
"That at least seems to be why they're going after the Seattle market so aggressively," York said. "The thing about these comparative campaigns is you have to hammer away at them for a long time. You can't just hit someone and then run away. You have to have a lot of marketing dollars to put behind it and that's something that McDonald's could theoretically do."
It's unclear whether McDonald's will take its "four bucks is dumb" campaign national. Nationwide, 4,000 out of 13,000 McDonald's restaurants sell espresso and the number is growing. Out of the 190 McDonald's in Western Washington, 155 sell espresso.
"We see ourselves as trying to enter a new category and steal as much of the breakfast and coffee share as we can garner," said Kelly Hoyman, Northwest region marketing director for McDonald's.
The fact that "four bucks" sort of rhymes with "Starbucks" is not on purpose, said John Livengood, executive creative director at DDB Seattle, McDonald's advertising agency.
"The idea is, in a billboard, you got three or four seconds to capture people's attention," he said. "You're trying to be as short and sweet and as pithy as possible."
No matter what McDonald's does, Starbucks is likely to stay on its own message, and surgically pick advertising spots that promote social responsibility.
Says Starbucks chief marketer Davenport: "The answer to how we're going to respond to the competition is we're not going to respond. We're going to keep doing what we do and we're going to keep doing it our way."
P-I reporter Andrea James can be reached at 206-448-8124 or [email protected]. |
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mindmetoo
Joined: 02 Feb 2004
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| Posted: Fri Dec 12, 2008 5:50 pm Post subject: |
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| In Korea I don't mind paying $3 for a coffee at Starbucks. The higher price means less children, less cackling ajummas, less ajusshis in loud suits. |
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crescent
Joined: 15 Jan 2003
Location: yes.
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| Posted: Fri Dec 12, 2008 6:53 pm Post subject: |
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| mindmetoo wrote: |
| In Korea I don't mind paying $3 for a coffee at Starbucks. The higher price means less children, less cackling ajummas, less ajusshis in loud suits. |
What Starbucks was THAT?
It used to be that I could zip in and zip out with my 6-shot vente. Now, i stand in line behind gaggles of women who can't decide what they want. They go through 3 different point cards and try 3 different overspent visas while their kids slap the glass on the display case..
Then i have to go searching for the liquid sugar bottle, which is always on a table somewhere.
McDonald's though. I'd use their washrooms if I had to go #1. |
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Xuanzang
Joined: 10 Apr 2007
Location: Sadang
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| Posted: Fri Dec 12, 2008 7:13 pm Post subject: |
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| Tables are too small at Starbucks and it is way too crowded. I`ll pass on both of them. |
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aarontendo
Joined: 08 Feb 2006
Location: Daegu-ish
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| Posted: Fri Dec 12, 2008 7:53 pm Post subject: |
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| Yeah hell I prefer DD. They have decent chairs to sit in, the ones at Starbucks are those hard ass study chairs from my uni library. |
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sojourner1
Joined: 17 Apr 2007
Location: Where meggi swim and 2 wheeled tractors go sput put chug alugg pug pug
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| Posted: Fri Dec 12, 2008 8:00 pm Post subject: |
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| Do McDonald's in Korea serve gourmet coffee? In the states, a couple years ago, they upgraded to a gourmet coffee from the Folgers/Maxwell House style swill people in mom and dads time drank. McDonald's coffee at home is really good enough on occasion when you just want to jump in the car as soon as you wake up to get on something quick. |
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crusher_of_heads
Joined: 23 Feb 2007
Location: kimbop and kimchi for kimberly!!!!
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| Posted: Fri Dec 12, 2008 8:11 pm Post subject: |
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| mindmetoo wrote: |
| In Korea I don't mind paying $3 for a coffee at Starbucks. The higher price means less children, less cackling ajummas, less ajusshis in loud suits. |
I concur, but children are tolerable; vampiric disgusting adjumma hags are not tolerable, they are horrid. The duds in the loud suits are good for a laugh until they start spitting or going on about Dokdo.
p.s. even though it's near Tiger World and a KFC, I 've never seen kids at that Starbucks near Bugae station. |
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NoExplode
Joined: 15 Oct 2008
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| Posted: Fri Dec 12, 2008 9:47 pm Post subject: |
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In Korea, the billboards would have to be "Five bucks is dumb."
However, the ad would go over the heads of Koreans, as they are still in the stage of Starbucks being a status-symbol thing, and they would read the ad and think to themselves, "No it isn't, it's fashionable!" |
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Billy Pilgrim
Joined: 08 Sep 2004
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| Posted: Sat Dec 13, 2008 12:22 am Post subject: |
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| I'm sorry, but if you buy a cup of coffee at McDonalds, you are not a coffee drinker. |
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Hanson
Joined: 20 Oct 2004
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| Posted: Sat Dec 13, 2008 1:08 am Post subject: |
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| Billy Pilgrim wrote: |
| I'm sorry, but if you buy a cup of coffee at McDonalds, you are not a coffee drinker. |
Actually, I heard McDonald's really improved their coffee. I remember reading about some blind taste test being done between Micky D's and Starbucks, and McDonald's coffee was chosen more often... Maybe someone less lazy than I can dig up a link? |
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Horangi Munshin
Joined: 06 Apr 2003
Location: Busan
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| Posted: Sat Dec 13, 2008 4:45 am Post subject: |
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I think McDonalds coffee in Korea greatly depends on which branch you get it from. Maybe I've been unlucky but when I've got it or been given it, it has been horrible. Worse than mix coffee.
I have had McDonalds Lattes from a couple of places and they've been O.K |
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NoExplode
Joined: 15 Oct 2008
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| Posted: Sat Dec 13, 2008 5:35 am Post subject: |
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| Horangi Munshin wrote: |
I think McDonalds coffee in Korea greatly depends on which branch you get it from. Maybe I've been unlucky but when I've got it or been given it, it has been horrible. Worse than mix coffee.
I have had McDonalds Lattes from a couple of places and they've been O.K |
They haven't started with the "new" coffee yet here I don't think. |
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xpat
Joined: 13 Mar 2008
Location: Kangnam baby
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| Posted: Sun Dec 14, 2008 12:26 am Post subject: |
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I've had Mc Donalds coffee at COEX, Express Bus Terminal and Jogno and each time the coffee has been Lavazza .
In case you don't know, it's Italy�s number 1 gourmet coffee. |
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tzechuk
Joined: 20 Dec 2004
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| Posted: Sun Dec 14, 2008 1:13 am Post subject: |
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| xpat wrote: |
I've had Mc Donalds coffee at COEX, Express Bus Terminal and Jogno and each time the coffee has been Lavazza .
In case you don't know, it's Italy�s number 1 gourmet coffee. |
Yes, Lavazza everywhere, AFAIK.
I quite like McDonald's coffee. |
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NoExplode
Joined: 15 Oct 2008
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| Posted: Sun Dec 14, 2008 2:27 am Post subject: |
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| The new stuff is "Premium Roast" sold at "McCafe's." I have yet to see one in Korea. |
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