Starbucks Corp. on Thursday posted four ads on its Web site in a sneak peak of a new multimillion dollar marketing campaign meant to take on lower-priced rivals in the gourmet coffee market.
The ads, which will begin running on May 3, do not mention any competitor explicitly, but clearly attempt to keep customers from switching their allegiance to players such as McDonald's Corp. McDonald's is rolling out a new line of espresso-based drinks to all of its 14,000 U.S. restaurants.
One print ad tells consumers to "beware of a cheaper cup of coffee," adding "it comes with a price." Another warns customers that "compromise leaves a really bad aftertaste."
Other ads focus on what Starbucks has long said makes the company stand-out from other coffee retailers — the quality of its beans and its customer service.
In a video posted on the Web site and addressed to the company's employees, Chief Executive Howard Schultz called the ads "a little tongue in cheek," and said the company will be "very clear and very purposeful that the time has come for Starbucks to tell its story."
On Wednesday, Schultz said on a conference call with investors that the Seattle-based chain will launch the marketing campaign to focus more on value and the quality of the Starbucks experience.
The comments came after the company reported its fiscal second quarter net income fell 77 percent, mainly due to charges related to its cost-cutting campaign. The company's adjusted profit rose slightly and beat Wall Street analyst estimates by 1 cent per share.
The company's same-store sales, or sales at stores open at least a year, fell 8 percent both worldwide and in the U.S.