Pricing is a sensitive issue. Offering products at premium prices has its advantages as consumers tend to associate more expensive products with better quality. Starbucks used a premium pricing strategy. Its coffee sold 25% above market value in 1990. Therefore, Starbucks cafes make great efforts to distinguish their brand from their competitors by issuing new types of coffee drinks with a unique and attractive flavor, a unique interior design with warmth and relaxation, to enjoy a cup of coffee in the mood and its new service (Starbucks coffee cart). Due to all these advantages, customers are willing to pay more for such superior quality of coffee and level of service. The variety of Starbucks' drinking list
Starbucks is the master of employing value-based pricing to maximize profits, and they use research and customer analysis to formulate targeted price increases that attract the most amount consumers are willing to pay without being kicked out. Profit maximization is the process by which the firm determines the price and level of production of the product that yields the most profit, which Starbucks is using it.
Starbucks is constantly releasing a new batch of coffee; There are currently 140 cold and warm drinks on its changing menu. The Starbucks menu is divided into seven sections. Each section contains a special drink of hot and iced coffee, refreshing, iced or hot tea, and a variety of natural canned and handmade juice in Starbucks, such as Dragon Drink. The prices of Starbucks drinks with different types and sizes, for example, the value of the large American size is 18 dirhams, the iced tea of the same size is 24 dirhams, and the small one is 17.75 dirhams. As for the iced coffee, its prices are lower than the Frappuccino coffee. The price of a Frappuccino coffee is not less than the price of the small size at 18.50 dirhams, and a large one at 22.50 dirhams, like iced coffee and latte, the value of a large coffee is 19.50 DH, while the small size is 15.50 dirhams. The Starbucks experience is completely exclusive in its own right and complements its pricing strategy. The idea is to offer the best quality products at a somewhat higher cost. However, Starbucks is not only selling coffee, but it is also a complete experience built on the idea of offering a luxurious experience. There is everything from music and comfort to store design and luxury to help clients de-stress. Moreover, these factors helped in maintaining a premium pricing strategy and a premium image. Its distinct pricing strategy complements its ethical, global, and distinct branding image.
