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Coffee Geeks Meet Grape Nuts: Starbucks Goes Deeper Into Wine

2012 January 24
by Mike

Starbucks announced yesterday that it will be adding wine and beer to its menu at select locations in Chicago, Atlanta, and Southern California. This is actually an expansion of its foray into alcoholic beverages: in 2010, the coffee colossus started offering wine and beer at a handful of stores in the Pacific Northwest. The Starbucks news comes just weeks after the hamburger chain White Castle began serving wine and beer at one of its restaurants in Indiana, a test run that is being conducted with an eye to possibly adding alcohol sales at other outlets. Meanwhile, drugstore giant Walgreen recently opened an upscale pharmacy in Chicago that includes a wine department stocked with hundreds of offerings. Walgreen has been selling wine again since 2010 (it had stopped selling alcohol in the mid-1990s), but the new Chicago location is apparently its first venture into high-end wines, and some of the choices are extravagant; for instance, the store is selling the 2006 Penfolds Grange for $450. The Grange would definitely look interesting sharing a basket with a bottle of Maalox and a box of Trojans; talk about unlikely pairings.

So wine is turning up in some strange places these days, which I suppose can be taken as an encouraging sign—further evidence that wine is shedding its highbrow image and becoming a mainstream American habit. Wine is even encroaching on beer’s turf; a number of baseball stadiums are now selling cabernets and chardonnays alongside the Bud Light. Of course, wine is now on the menu at baseball games for the same reason prominent chefs, restaurateurs, and food purveyors (Danny Meyer, Lobel’s) are turning up at the old ballpark: teams are trying to cater to the most affluent fans, and offering wine is seen as one way of pulling them in and keeping them happy (and spending money). So while I do think wine is losing the elitist taint, some businesses are clearly using wine as a means of appealing to those with particularly deep pockets.

The Starbucks story is the one that most intrigues me. At the moment, Starbucks offers wine and beer at five locations in Seattle and one in Portland, Oregon. The wine choices include an Oregon Pinot Noir, a Prosecco, and an Argentine Malbec. The company hasn’t disclosed whether the alcoholic beverages have boosted traffic but says the addition of wine and beer has proven popular with customers, and the fact that they are now expanding the program suggests that this is indeed the case. I could certainly see kicking back with a wine or beer at a Starbucks; some of the stores are quite comfortable, and depending on the hour and my mood, a wine or beer might be preferable to the house specialty.

However, Starbucks is known as a coffee merchant, and given the strength of its brand identity, I wonder if it can really diversify on a broad scale. Some Starbucks patrons in Southern California, interviewed by The Los Angeles Times, were not enthusiastic about the new menu items. “If I wanted a beer, I’d go to bar,” Doug Tanaka, a 48-year-old police officer from Valencia, told the paper. “I bring my grandkids in here. I don’t want to have to deal with a drunk if I’m having coffee.” (Given that Tanaka is a cop, one can assume that the feeling would be mutual.)  It will be interesting to see if Starbucks can fashion itself into a combination coffeehouse-wine bar. Let’s just hope they don’t get cutesy and put a merlot macchiato on the menu.

18 Responses leave one →
  1. January 7, 2016

    That’s awesome. Coffee is such a huge market.

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  4. February 9, 2012

    Is high end wine and a box of trojans really an unusual pairing? No wonder the cashiers give me such funny looks.

  5. February 2, 2012

    Hi Mike,

    Very interesting stuff. My French conversation group meets in a local coffee shop that started offering some very interesting American/regional wines a few years ago. The transition seems to have been quite a success, and, using our 12-person group as a sample, it’s always interesting to note that about half of us enjoys coffee while the other half orders a couple bottles of wine and a cheese plate. Sometimes I go for coffee and sometimes I love to try the wine offerings, depending on the evening. At any rate, I am so glad this local place offers both! (With that said, I will be much more skeptical of the Starbucks campaign.) On verra!

  6. Dan McCallum permalink
    January 27, 2012

    In my opinion, Corporate Coffee and Corporate Wine are both unstable fissive entities gone way past their half-life. But unlike minerals in the ground, public companies cannot just lay where they are while the glow dies down. Their managements are incented to make glow, and in order to do that they have to expend more and more resources to achieve less and less glow. Eventually will come their Kodak moment.
    In the meantime, what’s next for $tarbucks? In the PNW, I’d suggest on-site bicycle repairs.

  7. Robin C permalink
    January 26, 2012

    Starbucks is an ideal place to handle drunks; just pour coffee down their throats.
    Also, I didn’t know that plying a man with champagne would make him take you to Paris. It’s probably too late for me to try that, but given the opportunity . . .

  8. Larry Kantrowitz permalink
    January 25, 2012

    hopefully the wines served will have more nuance and elegance than the over roasted beans they serve. If Starbucks was wine it would be 16% abv Zin in charred barrels….or a Helen Turley PN (sorry couldn’t resist)

  9. Mike G permalink
    January 25, 2012

    Interesting move and one I am sure will be successful in selected markets.

    We have few coffee shops in my area other than Starbucks. So, as usual I will wait 5-10 minutes to order a simple cup of black coffee while others order the fancy stuff.

    I can hear it now,”One tall half-Cab Frappuvino and a blended grande Zin Americano with nonfat milk, whip cream and white chocolate please. Oh, and could you make the half-Cab a bouble and add a shot of Very Berry to the Zin.”

    Seriously, it is easier to sell coffee than wine. Many people who would spend $6.00 on a coffee or $22 dollars on a family of five on blended and other various drinks at a Strabucks would probably be a different group than those who will enjoy the wine offerings. However, I perdict that many of the new evening wine buyers will also grab an espresso on the way out. Starbucks seems like a safe friendly place to meet friends for a glass of wine. They could also offer an upscale cheese box. However, they will need to keep it simple on the wine selections. In my opinion they should also get licensed to sell wine to go and feature the items they are selling by the glass. Does anyone know how they control customers in keeping them fom leaving with open containers, or what kind of glass the wine is served in?

  10. January 24, 2012

    David F, thanks for the comment; you make some excellent points, and one can assume that the issues you raise have factored into the decision by Starbucks to expand into wine and beer. Re extending store hours: I assume that this program is geared to Starbucks locations that already operate well into the evening, and that pull in the kind of crowd that would be most receptive to having wine and beer on the menu (young urban professionals, etc).

    Jack, you make a very fair point–some of these spoofed wines could easily be confused for Starbucks drinks!

    MadisonJ, it has been a long time since I was single! And, no, I never brought a bottle of Grange on a date. I like the Brillat-Savarin quote, but I have an even better one for you, taken from Jean-Robert Pitte’s recent book about the rivalry between Burgundy and Bordeaux: “Bordeaux makes you piss, Burgundy makes you fuck.”

  11. Jack Bulkin permalink
    January 24, 2012

    Madison, I love your comment and your conceptualization but as it applied to my life I must respectfully disagree with your conclusion.
    You said: “Burgundy makes you think of silly things, Bordeaux makes you talk about them, and Champagne makes you do them” –Brillat-Savarin.
    In my life, too many times after drinking too much champagne, I was convinced by the woman then in my life to fly to Paris. Once there, we sadly did not drank Champagne, but instead only Burgundyand Bordeaux thus only thought and talked about of silly things.

    But maybe that is just the story of my life. : )

  12. madisonj permalink
    January 24, 2012

    Mike, it’s been a long time since I was single, but it’s clearly been a longer time for you. One does not pair “a box of Trojans” with a $450 Grange (unless your date is accustomed to being addressed as “Your Majesty”). In some instances, a six-pack will do nicely, but I always found that the Trojans were far more likely to be used when paired with a reasonably priced non-vintage Champagne. Not foolproof, but a high batting average as compared with other beverage pairings. “Burgundy makes you think of silly things, Bordeaux makes you talk about them, and Champagne makes you do them” –Brillat-Savarin.

  13. Jack Bulkin permalink
    January 24, 2012

    Since many of the huge ripe wines touted by current point gifters err wine critics taste like Mocha infused winechinos what’s the big deal here?

  14. David F. permalink
    January 24, 2012

    In Washington, DC most Starbucks close in the late afternoon or shortly thereafter (and that appears to be true in other cities I tend to visit). By selling beer and wine (and some additional food items as mentioned in several stories), it allows them to stay open later. Given that the rent for any particular store is the same regardless of how long it is open, this allows Starbucks to increase the dollars made per square foot of each store (and/or per store) – assume that the money from beer and wine exceeds the expenses including labor. Also, remember that sales per each store open more than year is a MAJOR metric in retail and a metric that investors look at. So if the sale of beer and wine can increase per store sales, especially for older stores, it will boost Starbucks’ stock price.

    On a cautionary note, I suspect that this might be a very slow roll out and very patchwork. In many places, it can be tough to get a liquor license. Lots of regulations and limitations.

  15. January 24, 2012

    Erik, thanks for stopping by, and that’s a really interesting point regarding independent coffee shops. So I guess Starbucks was hopping aboard the bandwagon in the Pacific Northwest. I think this could certainly work them for in cities like New York, San Francisco, and Boston, and frankly, I’m surprised that not one of those cities is included in the latest expansion plans. At any rate, I do like the idea of a combination coffeehouse/wine bar; toss in a book department, and that would be nirvana.

    Nannette, wifi is essential, and wine and beer would be good, too. But between the wifi and the alcohol, getting any writing done might be a challenge!

  16. January 24, 2012

    I’m ecstatic.
    My complaint has always been that most pubs/bars don’t have wifi.
    I love to quaff an adult beverage while I work.
    (Once a Wine Harlot, always a Wine Harlot!)

    All the best,

    Nannette Eaton

  17. Erik permalink
    January 24, 2012

    It’s a shrewd business move here in the NW – many independent coffee shops offer local wines and beers. There’s a comfort/quietness that purveys coffee shops that people find appealing for reading, working, etc. Many are crowded in the evenings, to the point where some bars have experimented with “quiet nights” to compete. It’s not my preferred scene, but I understand it (I’ve recently finished grad school). There are also plenty of Saturday afternoons that straddle the line between caffeine & alcohol – especially if you’re with a group of people. It’s here to stay in Portland, and I think it’ll catch on in other cities.

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