Beer is one of those great recession-proof items: Loyal beer drinkers aren’t going to give up their brewsky no matter how bad things get and, let’s face it, the worse things get — the more you need a beer.
As things heat up in the fast-food business — every chain it seems has a value menu and McDonald’s has given everyone the jitters with its foray into premium coffee — a couple of chains seem to think they need a cold one, too.
Both Burger King and Starbucks have started experimenting with beer — BK at its clubby Whopper Barfranchise and Starbucks at its 15th Avenue caféin Seattle. In fact, BK is opening a new Whopper Bar in South Beach, Fla., next month.
So, is beer the high-margin item chains are banking on to dig them out of the economic slump?
Burger King says its decision to serve beer came from customer feedback. They’re specifically targeting touristy areas like Orlando and South Beach and serving up fanny-pack favorites, including Bud, Bud Light, Bud Light Lime and Miller Lite.
(“The only thing Americans like better than cheap, crappy food is cheap, crappy beer!” quips Luke Livingston, author of Blog About Beer.com.)
Starbucks, on the other hand, is selling microbrews and cheese in addition to its caffeinated fare at the “15th Ave Coffee and Tea” shop in Seattle, in what appears to be its latest diversionary tactic from America’s romantic breakup with the $4 latte. (See also, Starbucks instant coffee.)
Some customers are receptive to the idea.
“Anything that makes it easier to grab a beer during the workday is bound to be a success,” says Alyx Kaczuwka, a lager enthusiast and author of the blog LOLFed.com. “Microbrews and cheese? That increases the likelihood of me joining my coworkers on their Starbucks run by about fivefold!” she adds.
But don’t expect to see beer at McDonald’s or other fast-food chains, said Morningstar fast-food analyst R.J. Hottovy.
“It can’t be rolled out nationwide — it’s too hard,” Hottovy said. “The biggest hurdle is getting liquor licenses.”
Not to mention, how do you square giggling kids and Ronald McDonald with swigging a beer?
Hottovy thinks the use of beer is more a publicity stunt to generate buzz for the brands.
(Hey, Jimmy, hand me that “Mission Accomplished” banner!)
And, while it’s hard to go wrong with beer, it seems at least one of them probably did.
The use of beer is actually a smart move for Burger King — not so much for Starbucks, said branding expert Rob Frankel.
For Burger King, which has already lost the school-age set to rival McDonald’s, it’s probably a move to expand its core market in the other direction — from 12-18 year-old boys to young men over 20, Frankel said.
(Ah ha! That explains who’s watching those creepy King commercials!)
But “Starbucks is making the same mistake a lot of doomed brands make … straying from their core expertise,” Frankel said. “The further they get away from coffee, the worse they do,” he said.
“They’re in desperation mode,” Frankel said.
All they had to do was tell people why they should pay more for Starbucks coffee than McDonald’s, Frankel explained.
If they had done that, they might not be this desperate, he said. Because kids today aren’t like prior generations: They’re not going to give up their iPod for a Zune or lesser-known brand, he said. They’d rather go without their vanity brands — even if they have to wait a while to save up the money. (In fact, they're probably saving up for theiriPadsright now.)
So both chains bought customers a beer, but it seems only Burger King is likely to get lucky. Starbucks will probably wind up knocking on coffee’s door at 2 a.m., begging it to take it back.
Hey, coffee? It’s me, Starbucks. Can I come in?