If some investors think Starbucks (NASDAQ:SBUX) is losing its caffeinated edge, the coffee purveyor apparently isn't taking their attitude lying down. It plans some fall events in some of its stores to shore up the idea that it's the head honcho in beans.
According to Reuters, Starbucks will host in-store coffee tastings in its North American stores as one way to educate its consumers and at the same time, reinforce the idea that it has not only leadership but also expertise for coffee aficionados. It'll also launch podcasts about coffee to further prove out its leadership in high-quality beans. Take that, McDonald's (NYSE:MCD).
Indeed, the article mentions cheaper rivals like McDonald's and Dunkin' Donuts, which would like to woo as much coffee business as possible away from Starbucks. Although comparing a McDonald's restaurant to a Starbucks cafe is a bit outlandish, what makes the idea a little bit more threatening is that McDonald's has teamed up with Green Mountain Coffee Roasters (NASDAQ:GMCR) in at least a few of its markets to provide gourmet, organic coffee. That's no joke, given the fact that Green Mountain has emerged as a company seeking to capitalize on some of the trends that Starbucks holds dear to its own heart, such as environmentally responsible initiatives.
And of course, there are still people out there who don't quite understand why a Starbucks coffee costs so much. Those are the types that Starbucks surely would like to charm as well. And there are plenty of other rivals who can satisfy a java jones -- take Caribou (NASDAQ:CBOU), Peet's (NASDAQ:PEET), and even more well-rounded hangouts like Cosi (NASDAQ:COSI).
Starbucks' leadership probably wouldn't even be called into question, of course, if investors hadn't reacted with such negativity to the company's most recent quarterly earnings report. Although some of us believe investors overreacted, it's clear that some people are really concerned that Starbucks' incredible growth run is reaching the end of its rope. Maybe you could even argue that its recent focus on holiday glitz and book promotions are more signs that it's trying to shore up its leadership in the coffee lifestyle.
Although the educational initiatives may give naysayers an argument for the idea that Starbucks feels the heat, I believe there are plenty of us shareholders who have the opinion, "Don't mess with the best" when referring to the coffee giant. Starbucks has the brand and the clout, and these plans for the fall should do well to remind us that when it comes to coffee, Starbucks is the brand to beat. Shaking this giant's hold on consumers will be easier said than done.
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Alyce Lomax owns shares of Starbucks but of none of the other companies mentioned. The Fool has a disclosure policy.
