Starbucks Reduces Discounts and Promotions | CNN Business

New York CNN -- 
 
Starbucks, the world-renowned coffee chain, is set to reduce promotions offered via its mobile app. The move aims at encouraging customers to pay full price for their coffee and tea. This decision was first reported by the Wall Street Journal on Monday and later confirmed by CNN. 
 
The new promotional strategy forms part of CEO Brian Niccol's plan to reposition Starbucks as a premium brand. Simultaneously, it will also alleviate pressure on employees who often find themselves overwhelmed with work during high-promotion periods. 
 
In September this year, Starbucks implemented a different approach compared to previous months: they offered extra loyalty points on Tuesdays and deals on various drinks purchases every Saturday. These offers contrasted significantly with earlier deep-discount strategies such as "buy one, get one free" or 50% off discounts that were prevalent throughout many months in the year. 
 
However, Starbucks has decided not to run broad offers during the upcoming holiday season. Instead, they intend to promote seasonal beverages through advertising campaigns, according to reports from the Wall Street Journal. 
 
Historically speaking, Starbucks had been circumspect about running coffee promotions but increased these efforts earlier this year in an attempt to win back customer patronage. 
 
Now under new management since September, when Niccol took over as CEO after two consecutive quarters of falling sales, Starbucks is reversing its promotional strategy—a major shift indeed! 
 
Bank of America analysts noted last week that infrequent afternoon visitors and customers aged between 18 and 29 have begun drifting away from Starbucks outlets recently. 
 
Niccol’s vision for Starbucks (SBUX) involves returning it into a traditional coffee shop rather than continuing as primarily an online-driven business model—an insight he shared in a letter addressed last month to both employees and patrons alike. 
 
He expressed his desire for restoring Starbucks' original identity—that of being a community-oriented coffeehouse—featuring comfortable seating arrangements coupled with improved interior design while clearly distinguishing between services meant for 'to-go' and those for in-store customers. 
 
In his letter, Niccol wrote: "There's a shared sense that we have drifted from our core. We're committed to elevating the in-store experience—ensuring our spaces reflect the sights, smells, and sounds that define Starbucks." 
 
Thus, with less emphasis on promotions and more focus on enhancing customer experience through improved services and ambiance, Starbucks intends to reclaim its premium brand image. The strategy is not just about boosting sales but also aims at reinforcing the company’s identity as a community coffee shop rather than merely an online business. 
 
As these changes take effect over time, it will be interesting to see how they impact both customer loyalty and the overall business performance of this global coffee giant.