Starbucks goes after the Tim Hortons crowd by bringing Seattle’s Best to Walmart

Marc Weisblott
Daily BrewApril 25, 2011

Starbucks drew its share of suspicion when it opened a couple of higher-end cafes in its home base of Seattle, which were designed to appeal to customers turned off by the trademark mermaid.

Yet, there's unlikely to be much commotion over the company keeping the siren logo off its new locations in Walmart stores across Canada.

Seattle's Best Coffee, the brand acquired by Starbucks in 2003, started a pilot project at Walmart Canada Supercentres in Calgary and Keswick, Ont. last fall.

Now, 10 of the cafes will be permanently installed as part of a re-branding effort that coincided with the debut of Seattle's Best in AMC Theatres and Burger King.

The strategy was likened to the relationship between apparel retailers the Gap and Old Navy, which make no secret about having the same owner, yet manage to appeal to two distinct types of customer.

While the packaged image of Seattle's Best used to focus on stereotypical coffee scenes like steaming mugs alongside cats in windows, the new marketing approach is focused on five different flavour levels.

Something more straightforward than the jargon of Starbucks, presumably, can help the company capture a market of more casual java drinkers.

"People don't drink no-name colas, but lots of people drink no-name coffees," explained Seattle's Best president Michelle Gass in the current issue of Bloomberg Businessweek. "That's because no one's come in and said, 'Don't accept a bad cup of coffee.' "

Starbucks chief executive Howard Schultz has set a $1 billion annual revenue goal for the spin-off brand: Walmart could offer the Canadian real estate, along with a certain amount of foot traffic from customers, including many who never developed a taste for the parent company's richer brew.

Curiously, the Seattle's Best expansion has come at a time when Tim Hortons has emerged as a symbol of caffeinated patriotism during the federal election campaign.

By that standard, a coffee brand named after an American city doesn't stand much of a chance with Canadian politicians, no matter how populist its approach.

(Starbucks CEO Howard Schultz. Reuters Photo)