Starbucks enters the ‘value’ zone
US coffee chain Starbucks is to roll out its first value menu in order to recover from recent losses due to the recession, changing customer habits and growing competition from fast-food chains. With the new value menu, customers will get a latte with coffee cake or a drip coffee with hot sandwich for USD3.95. The food and drink ‘pairing’ programme will be rolled out in March in all company-owned US outlets all day. Terry Davenport, Marketing Chief at Starbucks, said: “The most important definition of value is the one our customers have. In this environment, it's about everyday affordability.” Howard Schultz, Chief Executive of Starbucks added: “I strongly believe we are going to be in this environment for years. It is a reset of both economic and social behaviour." Starbucks’s effort is an attempt to regain market share from competitor McCafé, McDonald’s. In late January, the chain said that sales at US outlets open at least a year fell 10% in its first fiscal quarter, while net income dropped 69%. The company also revealed its intent to shut 300 units.
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