Starbucks Brews Up Movies, e-Books & News

Starbucks has teamed up with Yahoo to offer their customers e-books and movies in an attempt to encourage them to “stay a while” and purchase more items at Starbucks.

Starbucks, who traditionally charged for wireless internet, began their free wireless internet campaign in July of this year. Now when you access Starbucks’ wireless service, you will be welcomed to watch moves, read books or enjoy access to some paid sites from their partners, some of which include:

  • The Wall Street Journal
  • USA Today
  • The New York Times
  • Apple’s iTunes
  • Patch
  • Zagat

The move comes as Starbucks faces steep competition from McDonald’s Corp. and other fast-food chains pushing increasingly fancy coffee drinks. But it also offers Starbucks a chance to make money by selling songs, e-books and other material to customers who linger over its free Wi-Fi.

Customers will see the network as soon as they connect to Starbucks’ Internet on their smart phones, computer or tablets, such as the iPad. A welcome page allows customers to scroll through various sections including entertainment, wellness, business and careers, and “my neighborhood,” where they can find community news, restaurant reviews and more.

The e-books on the network are being offered through the Bookish Reading Club, a partnership with publishers, including Harper Collins, Hachette, Penguin, and Simon & Schuster.

Starbucks Corp. started offering free wireless Internet access in July, 2010. The new network, a partnership with Yahoo, is the next step in its strategy.

Most of the free content – from movies to books and news – can be read or viewed only in Starbucks. The content was designed so it could be consumed in small doses, anywhere from five minutes to 20. That way, people either want to buy the content outright to take with them, or return to Starbucks again. The sites were designed to remember where people leave off in a book or a movie, so picking it back up is seamless.

When customers buy the content, say a newspaper subscription or an e-book, Starbucks makes money by taking a cut of the sale. The company declined to specify its share.

The companies designed the site and its content to be consumed in smaller bits after observing customers, said Burke Culligan, vice president of product management at Yahoo.

“Users across the Internet are moving more into this ‘snackable behavior’ to begin with,” he said.

The company, based in Seattle, worked to get content its customers wouldn’t find anywhere else so people have a reason to go to Starbucks beyond the coffee, said Adam Brotman, vice president of Starbucks Digital Ventures.

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