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You Know There Is Trouble When...

Starbucks, most famous for converting a $0.40 product into a $4.00 product and holding the line for years, is now trying to position itself as "reasonably priced." The idea that Starbucks is an expensive luxury item has been, it seems, a misconception all this time. Who knew?

"There have been others that have been propagating the myth of the $4 latte, and that is not true," she said, adding that the average price of a Starbucks latte is $3.25. "We have got to correct the misperceptions that are out there."

Of course, this is absolutely correct. There is no such thing as a $4.00 latte. Lattes are $3.25, but the cup is $0.80.
Starbucks Plays Common Joe [The Wall Street Journal] via Asymmetrical Information