Starbucks in Classy Co-Venture With Burger King

Meet Howard Schultz's new friend.
Would you like fries with that? No,we're not kidding. You'll now be able to get French fries, bacon cheeseburgers, and all manner of artery-clogging junk food with your next Starbucks-generated drip coffee. Only not in an actual SBUX store. Nor will it actually be labeled with the green mermaid. As Starbucks Gossip and others are reporting, BK will begin carrying the Starbucks-owned subsidiary brand, Seattle's Best Coffee, at 7,250 restaurants (of about 12,000 in the US). SBC was founded locally in Coupeville in 1970; Starbucks bought the brand in 2003 for $73 million after its Georgia parent company ran into financial trouble. Now SBC is Starbucks' low-cost cousin to it premium brews, a means of extending market share in our current recession. BK will offer the brew "with optional vanilla or mocha flavor and whipped topping, at a suggested retail price of $1 to $2.79," says Starbucks, whose primary customers are accustomed to paying far more for their caffeine.

But, wait, if SBC is coming from the same company roasters, if some customers can't tell the difference, might not the BK deal actually siphon away some of Starbucks' regular patrons...?

Here's the Starbucks press release, in which the company declares "we are making premium coffee far more accessible than it has ever been." Well, Burger King is certainly accessible.

But you can also find the same premium SBC coffee at Subway and Taco Bell, which have already partnered with SBUX. And the SBC Web site--updated in May of 2008--lists over 500 cafes, an undetermined number of supermarkets, and "more than 3,900 foodservice locations, such as college campuses, restaurants, hotels and cruise lines" where you can drink its brew.

So maybe the Burger King deal isn't so special. And maybe SBC coffee isn't so premium. But the announcement certainly shows how Starbucks is aggressively chasing value-conscious coffee drinkers wherever it can find them. (This after a decent fourth quarter in which the company continued to cut costs while its sales declined by 4 percent. SBC's performance wasn't broken out in its financial statements.)

And here's something else that SBC drinkers may appreciate in our current economy: At Burger King, you're not expected to tip.

comments powered by Disqus

Friends to Follow