• Nescafé Targets Starbucks' Instant Coffee in Ads
  • July 15, 2009
  • Law Firm: Manatt, Phelps & Phillips, LLP - Los Angeles Office
  • Even before Starbucks’ nationwide launch of Via instant coffee, the new product has already become the target of a comparative ad campaign by Nescafé, the maker of Taster’s Choice instant coffee.

    Starbucks is testing its new instant coffee in Chicago and Seattle. In both of those cities Nescafé is running an outdoor ad campaign that points out the price difference between its brand and Via. One such ad on Chicago subway cars reads: “Starbucks makes great instant. We make great instant. So why does theirs cost 400% more?” The ad refers to Nescafé’s Taster’s Choice as “the smart choice.” In style, copy, and typeface, the Nescafé ads resemble the ads Starbucks is running for Via.

    Nescafé has also taken its price-based comparative ad campaign to the Internet. Its Web site for TastersChoice.com features a budget calculator and calls for consumers to stage a “coffee intervention.”

    A Starbucks spokeswoman said that the company does not plan to respond to the Nescafé ad campaign. The company also ignored McDonald’s “UnSnobby Coffee” ad campaign. Recent newspaper ads, however, make a case for Starbucks’ higher prices, saying they help pay for health care for its workers, environmental initiatives, and fair trade. Cheaper coffee, the Starbucks’ ads say, “comes with a price.”

    Why it matters: In hard economic times it is not uncommon for more marketers to use comparative ads to improve or retain market share. Comparative advertising can be a powerful tool for marketers to help differentiate their products from those of their competitors. Yet marketers considering a comparative ad campaign must tread carefully, since such tactics are more likely to draw the attention of and a response from their rivals. Recent months have seen a flurry of false advertising lawsuits, including Pepsi vs. Coca-Cola and Sara Lee vs. Kraft.