Gen-Z, Millennial Opps: Starbucks adds BFY products to menu amid spend increases (Score 60)

On March 2, Starbucks rolled out new non-dairy beverages which include ones made with Oatly oatmilk nationwide. Customers also now have the option to add Oatly oatmilk, soymilk, coconutmilk and almondmilk to their drinks. These menu additions, designed to reach a broader better-for-you (BFY) audience, . Starbucks is also adding spring beverages such as an iced pineapple matcha drink and the Pink Drink, a strawberry açaí beverage made with coconutmilk.

In a similar move, Starbucks also added things such as the Impossible Sausage Breakfast Sandwich, and it will continue introducing more and more plant-based proteins into its food menu.

Starbucks tends to advertise heavily and creatively ahead of the Q4 holidays; however, it also typically does so ahead of Valentine's day and upcoming holidays (Mother's Day, etc.) and seasons (for example, as you can see in the video above, it'a already advertising its new spring drinks soon).

So far in 2021, according to execs in Starbucks's most recent earnings call, the company has continued focusing on increasing drive-thru services, expanding its digital reach, enabling curbside pickup and expanding delivery capabilities.

Effective March 2021, Starbucks also hired loyalty strategy and marketing VP Ryan Butz. The company tends to heavily promote its loyalty program, so Butz now handles the effort's personalized marketing and other strategies.

So far in 2021, iSpot reports Starbucks has allocated roughly $15.2m on national TV commercials, up 49% from the roughly $10.2m it allocated by this point last year. Its 2021 commercials have targeted male millennials viewing programs such as The Super Bowl Today, Saturday Night Live, The Late Show With Stephen Colbert, The Tonight Show Starring Jimmy Fallon and Jimmy Kimmel Live. In all of 2020, Starbucks allocated roughly $92m toward national TV, nearly double the roughly $59.5m it spent in 2019.

According to Pathmatics, the company has spent approximately $14.2m on digital ads YTD, up 56% from the approximately $9.1m it spent within the same 2020 timeframe. Its estimated full-year 2020 spend dropped by 13% to $91.6m that of $105.4m in 2019. In 2021, Starbucks has earned 2.1b digital impressions through investments in Instagram (57%), Facebook (35%), Twitter (6%) and desktop video (2%) ads.

Additionally, Magellan reveals that Starbucks has aired 329 podcast ads within the past 12 months.

The company's increased TV spend and usage of podcast ads show it's still targeting millennials. As you can see, though its digital ad spend dropped YOY in 2020, its full-year 2021 spend in this channel is already set to rise YOY. This shows that Starbucks is also still heavily targeting Gen-Z. Remember, its target demographic has a strong skew toward better-for-you (BFY) audiences. I've also seen ads for this company on Hulu ads, so additionally offer OTT ad space. Per Kantar data, Starbucks also utilizes OOH, print (magazines) and local broadcast. It holds planning conversations in Q1 and buying conversations in Q4.

Agency & martech readers - We have not heard of any roster shifts since Starbucks promoted EVP and CMO Brady Brewer a year ago, so keep reaching out to remain top-of-mind.  To the best of our knowledge, the company works with media AOR Spark Foundry, shopper marketing AOR The Integer Group - Dallas and creative agency partner 72andSunny.