Starbucks and the Guide to Winning the Holidays

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Everything in retail has been turned upside down in 2020, so it’s exciting to see something continue as normal. Obviously, we’re talking about the unique power of Starbucks to leverage the calendar to its fullest advantage.

And while even this success requires COVID-era context, it still emphasizes a strategic approach that will guide the success, or lack thereof, for many retailers in the coming months.

Pumpkin Spiced Success

This summer saw the earliest ever release for the Starbucks autumn hallmark Pumpkin Spice Latte. Were we shocked? No. 

As we noted last year, the ongoing push to bring the drink out earlier is part of a critical perspective that Starbucks brings to the calendar. Simply – they do everything within their power to address and/or combat seasonality. Last year, they launched the Tye-Dye Frappuccino during an annual lull to drive a short term boost, and consistently save bigger promotions for the fall and winter when their normals peaks come into play. Making the PSL launch ever-earlier has been part of a wider strategy to welcome the fall earlier and say goodbye to summer months less oriented to a coffee chain.

And like most of their campaigns, this one worked well. Since the start of the recovery, Starbucks visits saw its visit peak when traffic to stores came within 20.1% of 2019 levels – something that happened the week beginning August 17th. Yet, the Saturday and Sunday following the launch were within 7.7% and 6.2% of 2019 levels of the equivalent Saturday and Sunday in 2020 – even with the peak those days enjoyed last year.

Why Does This Matter for Starbucks?

As we noted in July, this pandemic has been particularly difficult for brands like Starbucks that bank on routines for traffic. We need our coffee as we head into work and the Starbucks nearby is a welcome kick-off to the day, but without the actual process of heading into work, that visit can fall by the wayside. But, with morning visits moving back towards normalcy, signs of a more ‘routine’ routine are emerging. 

And if the brand can combine that return with its consistent ability to control the calendar just as we begin their key season – the short term future for Starbucks could be bright, even under the crazy circumstances of 2020.

But This Also Matters for the Rest of Retail

2020 is not going to be remembered as the best year for the wider retail landscape. Yet, there are steps brands can take in the coming months to optimize for a holiday season unlike any other. And that begins with taking a page out of the Starbucks gameplan. 

If Thanksgiving is removed as a retail holiday, it could drive more buzz to Black Friday or give brands an opportunity to create their own ‘days’ throughout the season. Is the latter ideal? No. There is an obvious benefit to a wider sense of retail urgency that brings visitors into malls and shopping centers. However, even if it just mitigates losses the results could be significant. 

And if elements of the holiday season proceed as normal, there are still lessons to be applied. Whether it be the ability of a food brand to hijack Black Friday – the strongest day for Starbucks visits in 2019 – or leveraging Prime Day for offline visits or finding unique promotions that drive buzz this winter, utilizing the calendar to its fullest extent is a critical asset for top brands.

Will Starbucks see its normal winter surges? Which other brands will roll out similar strategies in 2020? Visit Placer.ai to find out.

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