When I said the value proposition of Starbucks Coffee Shops is more than coffee, what I am saying is Starbucks value proposition is more than coffee… and it is true!!!

During the summer of 1996, the reason why I bought a caramel macchiato at the Starbucks Store Astor Place, on my way to NYU classes, was because Starbucks Coffee Shop was located outside the metro station where I had to go out of the subway. Probably if the store is not located there, I wouldn´t walk another extra 100 meters or 200 meters for buying it.  Also, I was buying a caramel macchiato not because I wanted to stay in the shop, I was running to my classes, so I was a client for “take away coffee”.  But what is more important, I bought that Caramel Macchiato at Starbucks because they sold to me something I called “More than Coffee”.

Otherwise, why would I pay around $2.50 in the year 1996 for such a drink? (in dollars value of today the tall caramel macchiato in NYC is around $4.00). I did not go to Starbucks to buy a simple “coffee of the day”. I went to buy a “caramel macchiato”. I was not buying a simple cup of coffee.

Let me summarize it:

1. From the point of view of ingredients only,  I was buying:

Fresh Coffee Espresso PLUS my preferred Milk PLUS Foam Milk PLUS Vanilla Syrup PLUS Caramel Sauce.

How to make a Caramel Macchiato.

2.  From the point of view of convenience, I was able to go out the subway, and stop at the store, and in less than 5 minutes, I was ready to leave the Starbucks store with my caramel macchiato in my hands.

3. From the point of view of the experience, I was able to grab it and take it to my NYU class, and I was learning and listening to my professors, and drinking coffee for two hours… I loved it!!!

Can you understand why Starbucks sells an “experience to nurture and inspire the human spirit” and not just coffee?

Published by eleonoraescalantestrategy

Corporate Strategy Artist, San Salvador, El Salvador View all posts by eleonoraescalantestrategy