Hope Beckham Inc.

Caribou Coffee Case Study

Situation
Caribou Coffee Company Inc. (NASDAQ: CBOU), founded in 1992 and headquartered in Minneapolis, Minnesota, is the second largest, company-owned, gourmet coffeehouse operator in the United States, based on the number of coffeehouses. Caribou Coffee aimed to reward customers and welcome a new set of customers, mainly from Starbucks, by honoring a coupon for a free Caribou Cold Press iced coffee beverage. The Cold Press coupon redemption was in response to Starbucks recalling its coupon for a free iced coffee. Starbuck’s distribution of the coupon was derailed due to fraud and misuse. Caribou distributed the Cold Press iced coffee coupon to Caribou’s opt-in email subscriber list. The recipients were encouraged to forward the e-mail to their friends and “green friends,” which are loyal Starbucks customers. Caribou Coffee also accepted the coupon that Starbucks recalled.

Approach
Caribou Coffee’s PR firm, Hope-Beckham Inc. (HBI), was challenged to secure national media coverage for Caribou Coffee honoring the voided Starbucks coupon. A secondary objective was to encourage coupon redemption, thereby enticing loyal Starbucks customers to try Caribou Coffee. At the start of a holiday weekend, the Friday before Labor Day, and with no lead time from the client, HBI had to quickly target and notify reporters of Caribou Coffee’s offer. Messages in the pitch, sent to

national media outlets and key business trade publications, were developed to spread goodwill about Caribou Coffee, reward customer loyalty, generate awareness, interest, desire and action for a product that is unique to Caribou Coffee. HBI counseled Caribou Coffee to take the high road during media interviews and focus on its offer only, as opposed to pointing out Starbucks’ mistake. On the consumer side, online and viral elements were used to encourage recipients of the coupon to spread the message by sending on to their friends.

Results
The effort was effectively a “zero-dollar” campaign; execution required no out-of-pocket fees, only the PR firm’s time to pitch national news media. The story that Caribou Coffee honored a Starbucks’ coupon received national media coverage, including a Reuters article, in print and online media. Total combined media circulation and online visitors per month exceeded 43 million readers for this story alone and was covered by national news media including ABC News.com, About.com, Ad Jab.com, Brandweek Magazine, Chicago Sun Times, The Denver Post, MotleyFool.com and PROMO Magazine. Additionally, more than 20,000 coupons were redeemed. The coupon redemption received enthusiastic response from its customer base and reached a new set of its primary competitor’s customers. The media presented the story as a big win for Caribou Coffee against the industry leader 30 times its size.