“I spend too much at Starbucks” is a legendary meme.

It's also not an accident: the coffee retailer -- worth $120B -- uses many psychological hacks in its store and menu designs to get you to drop more cash.

Here are 11 of them 🧵

1/ Starbucks is all about positioning

The chain has higher prices vs competitors. But that's the point.

People typically assign higher value/quality to higher prices. Known as "irrational value assessment", this makes Starbucks an everyday luxury that people will pay for.

2/ Premium brand = premium customer base

By setting its prices higher, Starbucks attracts clientele that are relatively price insensitive.

Starbucks frequently raises its prices with little negative effect to its bottom line.

3/ "More than coffee"

Former Starbucks CEO Howard Schultz created the premium feel by emphasizing experience:

◻️Positioned SBUX as a "third place" (b/t home, work)
◻️Brought bean grinding in-store (for aroma)
◻️Banned auto espresso machines (it took away from the barista craft)

4/ Lighting and visual cues

The Starbucks operations is about "flow", efficiently moving people around the store+ getting them to spend.

To form lines, it directs people to well-lit areas (usually the merchandise, which provides the added benefit of nudging products for sale).