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Starbucks stuck in third gear

03/06/07, by Kate Hopkins Email 2363 views • Categories: Coffee, Starbucks

It all started with a leaked memo.

In the aforementioned memo, Starbucks CEO Howard Schulz stated the following:

Over the past ten years, in order to achieve the growth, development, and scale necessary to go from less than 1,000 stores to 13,000 stores and beyond, we have had to make a series of decisions that, in retrospect, have lead to the watering down of the Starbucks experience, and, what some might call the commoditization of our brand.

...and later:

when we went to automatic espresso machines, we solved a major problem in terms of speed of service and efficiency. At the same time, we overlooked the fact that we would remove much of the romance and theatre that was in play with the use of the La Marzocca machines. This specific decision became even more damaging when the height of the machines, which are now in thousands of stores, blocked the visual sight line the customer previously had to watch the drink being made, and for the intimate experience with the barista.

(snip)

Clearly we have had to streamline store design to gain efficiencies of scale and to make sure we had the ROI on sales to investment ratios that would satisfy the financial side of our business. However, one of the results has been stores that no longer have the soul of the past and reflect a chain of stores vs. the warm feeling of a neighborhood store. Some people even call our stores sterile, cookie cutter, no longer reflecting the passion our partners feel about our coffee.

The response to this memo from coffee fans throughout the States was a resounding "No kidding!!"

The media's response? Well the Washington Post had a headline that posed the question Is Malaise Brewing at Starbucks? An LA Times op-ed stated it clearly when they said Expanding too far too fast can turn companies from offbeat to bland.

Personally, I don't think that Starbuck's sterilization has anything to do with "too far too fast". It's simply the logical progression of any company's goal of "trying please every consumer while squeezing the most profit from them".

As an example let me bring up the two local coffee shops. From the time I enter the shop, until the time I have a drink in my hand - five minutes. This would include chatting with the barrista, and getting a little extra swirl in the latte. If I entered a Starbucks, it would take about half the time, but without the talk and the swirl.

These are little things to be sure, but when you sacrifice a dozen little things, it adds up to one big thing - namely that you've become a soulless corporation.

In thinking of the major brand names in the food world - McDonald's, Coca-Cola, etc. - the only one I can think of that still has some level of "soul" (for lack of a much better word) is Ben & Jerry's, and even that's a bit of a stretch.

Mr. Schultz can't have it both ways. Either you want power and profit, or you want to really, (and I mean really) connect with the consumer.

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Comments, Pingbacks:

Comment from: Tara C [Member] Email · http://www.dementedkitty.com
My knee-jerk reaction is also something along the lines of "No kidding!" However, I know of exceptions. The wife of a Starbuck's architect I know told me once that the Starbuck's at Two Union Square in Seattle is consistently one of the top 5 busiest stores in the United States. I'm not sure if that is correct. It may only be in the top 5 busiest stores on the West coast of the US or the like. It is a busy place, nonetheless.

The look and feel of the place rings cookie-cutter to me. The lamps, the tables, the counters are all what I expect from a hole-in-the-wall Starbuck's. The staff, however, make the place feel much different. They chat. They smile. They compliment. They hoc their wares and edible thangs without nagging. They make good suggestions. They even brag, though not about the smiling, compliments, chatting, and what not.

The first time I fetched a coffee for a coworker from Starbuck's after the Two Union Square store moved a few doors North I stood in line a few spots behind a very pretty and articulate lady with her 3-4 year old daughter in tow. The barista who began taking their order jotted notes on a cup for the lady, then engaged the little girl. He didn't talk down to her. He didn't do the baby-speak, replace r with w drek. He asked if she liked a few different things. When he received a positive response after mentioning one item, he proclaimed something like, "Oh, chocolate cows are vastly overrated. I make the _best_ chocolate milk. Let me show you."

I will continue to get my seldom indulged java fix from Café Ladro, Dilettante's, Verite, or Coffee to a Tea, in that order of preference. I prefer Italian roast and like to support places that make café lattes from fair trade coffee. However, I sometimes smile when passing the Starbuck's at Two Union Square. I wonder what it was like if/ when all Starbuck's were full of banter.

Aside: I'm really sick of having to press the print link to copy + paste from MS Internet Explorer 6 without having to copy + paste the contents of the whole page.
PermalinkPermalink 03/06/07 @ 09:27
Comment from: Kim Carlson [Visitor] · http://www.culinate.com
Hey, Kate: I agree with Tara C that you can find friendly staffs at Starbucks, but it's not consistent. At my local coffee stop--Vivace--the staff is cheerful and real, even when they're busy, and the design in the latte foam always lifts my mood.

And I agree with you that it's usually impossible for big brands to speak to the individual, although I was among those who were impressed by Whole Foods' John Mackey the other day in his discussion with M. Pollan. It felt like he was listening to people.

Incidentally, last week in his column on our website, Culinate.com, Matthew Amster-Burton addresses the question of whether Starbucks is a force for good or evil. I won't spoil it for you.

PermalinkPermalink 03/06/07 @ 10:19
Comment from: ellmnt [Visitor]
With many of the points, I would have to agree. I do find that location and store do matter about your experience. The sad piece, that where I live the Starbucks experience, no matter what store, is better then most of the local coffee houses. There is not any personal connection anywhere here!
PermalinkPermalink 03/06/07 @ 12:33
Comment from: Not Faint Hearted [Visitor] · http://notfainthearted.wordpress.com
I avoid corporate coffee whenever I can as much as I can. I go to my neighborhood coffee shop precisely because the people that work behind the counter know me. I know the people sitting at the tables and at the counter. Yes, sometimes it takes more than 5 minutes to get my latte and sometimes that make me the slightest bit impatient.

But the intangibles are what makes that shop part of my community. A Starbucks (or Caribou or Dunn Bros.) will never be that because they don't really want to be.

Think globally, caffeinate locally.

PermalinkPermalink 03/06/07 @ 13:48
Comment from: MB [Visitor]
I found that as starbucks expanded the service went from "eh" to "yuck". It really became obvious when they replaced our local Diedrich.

The "new" shop is boring, quiet, and everyone just gets a drink and leaves. The old shop was cheerful, noisy, and everyone sat and chatted.

The "new" drinks are quite bit more expensive, and honestly all just the same thing. The old drinks were pretty much anything - including real caffe macchiato (espresso + a bit of foam).

Just my preference, but I won't be returning to starbucks.
PermalinkPermalink 03/07/07 @ 11:09
Comment from: Nicholas Caratzas [Visitor]
The "new" shop is boring, quiet, and everyone just gets a drink and leaves. The old shop was cheerful, noisy, and everyone sat and chatted.
I remember reading a commercial interior design magazine article, years ago when SBucks was starting to push into the Northeast, about their stores. The article suggested that the design was supposed to keep you from getting too comfortable, the idea being that more customer throughput means more sales.
PermalinkPermalink 03/07/07 @ 20:12
Comment from: tanya [Visitor] · http://iaeapie.net
I agree with you Kate. I used to go to the same Starbucks for 2 months - rarely if ever had any conversation or that homey atmosphere feel. Switched to a local coffee shop and I know the names of the baristas, they know mine and lots of other shared conversations.
PermalinkPermalink 03/08/07 @ 22:18
Comment from: Lisa Gray [Visitor] Email
Interesting comments. I work as a Barista at a Starbucks in AZ and I know many of my customers names, what the do for a living and know their drinks before they order. I feel that my Starbucks is very "hometownish".
PermalinkPermalink 03/28/07 @ 12:48
Comment from: rina [Visitor] Email
I also work for Starbucks. I also know and love my customers- and yes I used the word LOVE - It may be a surprise to some but we also enjoy the connection piece with you our customer.. I love to hear about your day, and I love hearing what your doing and the fact that you share that with me -makes me feel like a bigger part of your day. Starbucks is what allows me to do that - so I assure you my Starbucks does matter !!!!
PermalinkPermalink 04/28/07 @ 12:07
Comment from: Alice [Visitor] Email
I also work for Starbucks. I work there for the customers. They really are a very big part of my life. I am old enough, and have had enough experience to have bigger better jobs, but I have found none more satisfing than working for this company and my neighborhood. I make it a point to connect as bast I can with all of my customers while trying to help them get to work on time. I become outraged with partners that don't go out of their way to make everyone welcone. Starbucks employees that don't take a genuine interest in their customers don't hang with the company very long. I encourage you to keep trying with us until you find a store (not a kiosk) that meets your needs and cares about you. We may seem a bit 'cookie cutterish' but the 'personality' of each store will vary with each location. Please let the manager (or the company) know if we are uninterested or off-hand in any way. That's not what we are about... I am proud of the service I give to my customers and I truely believe that there are quite I few that 'come for the coffee, stay for the show'.. I am totally with rina when I requote her'My Starbucks DOES matter"..
PermalinkPermalink 06/21/07 @ 14:06
Comment from: Pat Nerr [Visitor] Email · http://www/greenapronstories.com
Nice take on the letter. Your final comment was dead on...

Good coffee from a "heading downward" company... change is needed there.
PermalinkPermalink 10/25/07 @ 03:48
Comment from: SeanJohn [Visitor] Email
First thing, I am a Starbucks partner. You can say that you don't feel as if dont we take time out for every single patron. Think of it this way. You know how pissy you get when it takes us more than a minute to get you drink to you? Imagine the nervous break down you would have if it took us more than two minutes to get it to you. We can't learn everyone's name all at once it takes time. We do what we can we're only human. Just tonight one of my regulars came in who had been gone for a few months, I greeted her by name and asked her if she wanted her usual drink a "Venti Chai Tea Frapp with extra whip and cinnimon powder" with a sleeve on it because her hand gets to cold. Don't say that we don't take time to get to know our customers.
PermalinkPermalink 02/15/08 @ 02:24

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