Venti, Meet Vino: Starbucks Spikes Its Drink Menu


Starbucks (SBUX) is renowned for its caffeinated drinks, but it isn't above spiking its beverage menu here and there. The coffee giant is adding wine and beer at up to a dozen cafes in the Southern California and Atlanta markets.

While this might sound like big breaking news, dabbling in adult beverages isn't actually a new concept for Starbucks. The company has been slowly building its tolerance to alcohol for a while.

Trial Run at Tipplers

Starbucks has been testing the spiked waters in Seattle since fall 2010. As of now, five Seattle stores and one Starbucks in Portland, Ore., serve beer and wine. It also plans to open up to another six in Chicago.

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Starbucks says that customers in its small sampling thus far have received the added items positively.

The timing here is essential: Beer and wine won't be available at the select cafes until the afternoon. That's because, like any coffee shop, demand for coffee jolts wanes as the day wears on, with the slowest sales time of day being the evening. After a certain hour and in certain markets, Starbucks wants to be the destination for customers seeking out that "third place" between home and work.

Do Coffee and Booze Mix Well?

There are clear risks involved with serving alcohol, not least of which are potential legal liabilities related to minors and intoxicated drivers. Furthermore, depending on what kinds of crowds these cafes draw, Starbucks' reputation for being a family-friendly venue could fade. There's also the possibility of overly caffeinated drunks.

Those worries might be allayed by the fact that the Starbucks cafes slated to serve alcohol will also sell higher-end fare like fruit and cheese plates, hot flatbreads, and focaccia with olive oil. Starbucks has also revealed that it never intends to offer beer and wine in all of its cafes -- a sign that this is a pretty controlled experiment, and hardly aimed at the binge-drinking crowd.

That's probably good; alcohol can be a social lubricant, but a little bit can go a long way for a higher-end brand like Starbucks. Plus, Starbucks' heart and soul resides firmly in the coffee bean.

Motley Fool analyst Alyce Lomax owns shares of Starbucks.

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