With 30 million weekly customers, Starbucks is much more than a beverage company: it's a lifestyle company (www.starbucks.com). Though Starbucks' core-competence is gourmet coffee beverages, it also sells a brand that people have begun to associate with an upscale coffee culture. With the increasing popularity of urban coffee shops, the Starbucks name seems to get the most recognition. In fact, Starbucks seems to be the Rolls-Royces of this fast-growing industry.
Every aspect of the Starbucks experience makes the consumer feel as though they are getting the highest-quality product and service offered. Every store is lavishly decorated to invite people in to "smell the coffee-; Starbucks sells the most well known brands of coffee machine products in the market; even the drinks are mostly priced above $3.00 (in comparison to the average drink at competitor Dunkin Donuts for a starting price of $0.99.) Starbucks has mastered the concept of consumer's perceive value of a product based on it's price. To understand how consumers attribute prestige to products, even a cup of coffee, it is important to examine some of the key marketing strategies companies like Starbucks use.
Products are frequently bought and displayed as markers of social class. These products are referred to as status symbols (Solomon 441). Big-ticket items such as cars, entertainment systems, and jewelry are the most obvious examples, however, smaller purchases can also be tools to display a consumer's social status. Starbucks is a perfect example. One small cup of coffee makes consumers feel more up-scale, trendy, noticed, and most importantly more fulfilled and satisfied with their choice. This is due to a product's brand equity.
Brand equity is defined as the extent to which a consumer holds strong, favorable, and unique associations with a brand in memory (Solomon 195). If a company can understand the components of their product and how consumers connect to it, then they can create a brand personality to appropriately market to that target audience.