FC Experts Blogs
January 9, 2008
Innovation: LEARN from Starbucks - Too Much of a Good Thing?
When it comes to customer experience, reliable rarely means exceptional. This is especially true at a Starbucks store. With all due respect to the dedicated evangelists of the ubiquitous company, having a cup of coffee can either be a utilitarian situation -- I’ve got to get coffee in me to wake up -- or extraordinary -- I want to go to that one store because the coffee is so good and the ambiance so different that I love spending time there.
Anywhere in between there is trouble on the horizon. The coffee is priced at several dollars above other chains, which could give the store an air of exclusivity with ample space to sit down with a friend. Yet the place is often packed with people ordering and the space to sit down is usually taken so the coffee is more often than not “to go”. This mix makes it an average experience, even though the brew is quite consistent in taste.
How many times do you go in, stand in line waiting after long and elaborate orders and fight other patrons for a seat at those prices before you start giving up some of the taste for convenience? How long before you meet in a less crowded, more exclusive place?
The coffee was supposedly so good, the opportunity so great, that customers kept filling the stores and stores kept opening on every corner. For the sake of efficiency, better machines where installed -- faster to make coffee, less interesting to look at while waiting. For the sake of greater food and coffee choices, the seating was sacrificed in many smaller stores -- more traffic, less stickiness of the brand experience, in an out.
It's not just the service that is average, but predictable. The coffee is the same way. Many coffee connoisseurs point out that Starbucks house coffees are actually fairly inexpensive blends, roasted a bit more than you'd expect. But there’s a reason for this: it keeps the coffee the same every time you drink it. Over-roasted Brazilian beans taste pretty much the same as an over-roasted bean from Mexico or Guatemala. Regardless of price and supply, each cup tastes just as you'd expect.
Predictability can be a double edged sword. It can put people in auto pilot, for example. Or it can lull a company into believing that all is well as its best customers start moving away. Predictability is the friend of complacency and taking things for granted -- on both sides of a relationship. Was Starbucks too much of a good thing? Maybe predictability is fine if you achieve success, then move on to innovate in another (or related) area.
Valeria Maltoni • Conversation Agent • Philadelphia, PA • www.conversationagent.com
Posted by Valeria Maltoni at January 9, 2008 9:30 PM | Topic: innovation |
6 Comments
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I am not a coffee drinker and don't particularly find paying 2 or 3 times as much for any product exclusive. I find it exploitive! Starbucks may have a great product and the fact that people will stand in line for what they provide says to me that there is a sucker born every minute.
The larger issue facing Starbucks, and any business that positions itself like this, is how long can or will it last? Free enterprise will find copy cat businesses piggy-backing Starbucks success and cropping up all around. Eventually the fad will change to another and Starbucks will take its place in the anals of American business innovators and the public will migrate to the next fad.
Remember the Sundries Fountains of the 50's and 60's? You might find a Retro-Restaurant doing this again, but it was replaced my Mickey D and his ilk. Mickey is still around and learned to change with the culture of the day. Starbucks could learn a few things from those who have made a fortune, literally and figuratively, from being the industry innovator.
Thank you for providing an example, Jay. I don't shop at Starbucks, but know many who do. Of course, it's easy for me to have comparisons, I am often back in my home town in Italy sipping coffee at my favorite cafes.
Maybe the next coffee experience will be at Mickey D. It will be interesting to see if there is innovation left in the market for coffee drinkers.
The coffee gods must have read your post!
I understand that Starbucks has announced a novel program in the Seattle market for $1.00 unlimited coffee!
How's that for an innovative shot across McD's bow?
Offering a low price with free refills, for a beverage that costs next to nothing to make, is hardly innovative. American diners have offered cheap coffee and free refills for a very long time.
As a Starbucks customer starting in early-90s Seattle, and since late 2000 in Philadelphia (though much less since I got my own espresso machine - much easier on the budget and usually better lattes) I could give you lengthy opinions on where they've gone awry. Let me instead sum it up like this: if Starbucks cannot rapidly stamp out the perception that their competition is McDonald's, they have a very serious problem.
I had responded to you, Carlos. but maybe my comment got caught in the spam filter :-)
Imagine what customers who have been paying more than $1.00 are thinking now... not a smart move to chase down the competition in my opinion.
I am with you on that, David. Instead of a machine, I use one of those manual things like I did in Italy. The espresso tastes good and is the right quantity for me.
When I get through the three books I am reading, I will crack open "Tribal Knowledge" by John Moore who spent eight years in marketing at Starbucks several years ago. In it, he talks about their corporate culture. Maybe I'll glean more than I have at his extensive body of posts on Brand Autopsy.