Take an avid Starbucks drinker. What reasons would he give you for splurging daily on that over-priced cup of coffee?
Taste?
Quality?
Ambience?
A pretty cup?
If he chooses from the last two, you might tell him he is delusional. And if he chooses the first two, still tell your friend that he is delusional and we’ll tell you why.
In a blind taste test conducted by testers at Consumer Reports and later covered by TIME magazine, it was revealed that people weren’t able to tell the difference between Walmart’s $3.88 coffee and Starbucks' $8.88 coffee. Walmart’s medium-roast Great Value 100% Colombia coffee was compared with the equivalent Starbucks counterpart.
So what makes people flock to these overpriced stores?
Yes, it is indeed the pretty cup, among other things. The Starbucks logo is very intricate, and that in itself gives the brand a premium feel. Almost all premium brands either shout-out their brand names in their logos (Dolce & Gabbana) or have very detailed designing (Versace).
Details have long meant that close attention has been paid which accounts for excellent quality. For context, think of your mom buying sarees. This attention to detail has now become embedded in human behaviour, and we pay subliminal attention to it (Things we pay attention to without knowing that they are actually happening). That’s why Starbucks' intricate crowned mermaid makes such an impact on us.
Another critical factor that comes into play here is the ambience. Starbucks invests a lot in its coffee shops; in fact, one of its largest stores (which is also roastery), is in Chicago with five storeys spread over a sprawling 35,000 square feet. A roastery not only adds to the brand’s authenticity but also becomes a tourist spot, attracting every single person who visits the city for a vacation. And as tourists are usually willing to spend more than the normal city dweller, this works in Starbucks' favour.
Roasteries were one example, but coming back to the stores, you’ll notice that every single store, throughout the world, has a distinct design style. Howard Schultz took great care in building the perfect coffee buying atmosphere. He focussed in getting an oriental-style coffee house, to import the foreign, exquisite feel that people get. He trained baristas always to show a happy, friendly face. Starbucks always has ambient music playing; the smell of coffee is high in the air.
They do everything to make you feel that their surcharge on the coffee is justified. Even the names of the coffee are designed like that so at Starbucks; you don’t order a simple black coffee, you order a Pike Place blend venti (Names vary in some countries).
Additionally, the simple act of adding your name on the cup gives you a sense of having something personalized. Also, Starbucks has worked hard to build a coffee culture, it gives you a sense of reward, that after a hard day at work a Starbucks coffee is the splurge you deserve. All these factors combine, and then even the takeaway consumer starts paying for the ambience.
Understanding consumer psychology is essential for a brand because if you don’t know where the gold lies and don’t dig for it, you’ll never get rich.
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