Starbucks Brews CD Offer

Coffee giant to lure customers with music

Published in CSP Daily News

LOS ANGELES -- Starbucks Corp. is putting CD racks in its U.S. and Canadian coffee shops to display up to 20 music titles at once. The goal is to boost sales by encouraging consumers to buy music to go with their coffee.

The company is working to capitalize on the watershed success last year of a Grammy-winning Ray Charles CD it co-produced and sold in its stores.

Starbucks' increased focus on its music business comes as it has been trying to reel in customers beyond the morning hours to increase sales at existing stores.

Ken Lombard, the head of Starbucks' music business, said the racks were part of a very concentrated merchandising effort to ensure visibility to the titles that we're offering.

Sales increases at Starbucks stores open at least 13 months have slowed in recent months after posting double-digit gains for much of last year. The chain's stock has slipped over 16% this year after rising nearly 90% in 2004.