Thursday, July 16, 2009

A Starbucks by any other name??

A gem from the Associated Press says Starbucks is opening a store without plastering the chain name on it.

The java juggernaut is changing the name of one of its existing stores to 15th Avenue Coffee and Tea -- for its location -- to give it more of a neighborhood feel.

It will open next week with not only coffee and tea on the menu, but also wine and beer.

The program is a pilot test and could lead to more neighborhood-named stores.

According to the AP report:

"It's interesting," said Morningstar analyst R.J. Hottovy, "especially since the Starbucks brand has been such an integral part of their success."

Hottovy said he thinks the Starbucks brand still "resonates" with those who drink coffee regularly. But, he added, with the recession now in its second year, the brand may be struggling more because it is considered "premium," and therefore expensive, by consumers.

The question would be whether the name change will take the "premium" out of the price, not just out of the image.

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