Starbucks purposely uses unusual size names (Tall, Grande, Venti) instead of Small, Medium and Large. This isn't just branding- according to their earnings call, this strategy adds $1.32 to the average transaction compared to regular pricing. The “Grande” size seems like the better deal so more people buy it.
01
Artificial Constraints + Urgency
Seasonal drinks like the Pumpkin Spice Latte or new limited edition Peanuts collab create “anticipatory regret”, a concept from behavioral economics.
Your brain fears missing out more than saving money. Starbucks filings show seasonal items increase traffic by 22% and add $1.18B in extra revenue each year.
The isn't just clever marketing- it's taking advantage of a cognitive blindspot most people don't even realize.
02
Reciprocity bias
Ever notice how baristas write fun things on your cup? These small gestures trigger your desire to feel good and return. Research from Stanford University shows that when we receive something personalized to us, we feel the urge to give back. Starbucks uses this with their rewards app too which brings in $2.39B in prepaid card loadings every year.
03
environmental psychology
The comfy chairs and Wi-Fi are part of Starbucks' “third place strategy”- a space between home and work that encourages longer stays.
86% of customers stay an average of 40 minutes, leading to 1-2 extra purchases per visit.
04
Endowment Effect Ever notice how cold drinks come in clear cups? This triggers the “endowment effect”, where seeing your drink being made gives you a sense of ownership before you even have it in your hands.
A University of Chicago study shows this can increase perceived value by up to 30%.
05
FUN FACT Starbucks' baristas often misspell names on purpose.
It creates a fun, shareable moment that gets people posting on their cups online.
This acts as free marketing, keeping Starbucks in daily conversations and builds their following organically.
*This is actually how my name was spelled once.
06
We're constantly developing fresh, smart ideas like these for our clients. If you're ready to stand out the way Starbucks does (without their massive budget), let's talk.
With Gratitude,
Allison
25 Country Ridge Dr. Suite 1 Monroe, CT 06468, USA