By now, many folks know that Starbucks has chosen to experiment by “de-branding” themselves by opening up three “neighborhood” coffee & tea shops called 15th Avenue Coffee & Tea. Along with coffee and tea, these stores will also sell wine and beer. I have yet to visit one of these shops but intend to at some point to see what the fuss is about.
The question is: “Will it work?”
I was told my Starbucks employees that they’re goal is to entice people that don’t normally go to Starbucks. And while some may go, they should be smart enough to know that that folks that are reasons why folks don’t go to Starbucks. De-Branding yourself isn’t going to change that, will it?
Will it? Good idea?
Here’s my take:
Most folks here in Seattle either love or hate Starbucks [with most leaning towards “love”]. Those who hate Starbucks really hate Starbucks. But the reality is that Starbucks has been the most prominent influence in making coffee a desired commodity not just locally but globally. As difficult as this might be to hear, local coffeeshops exist because of Starbucks. Kudos to Starbucks and while they may have been late to the Fair Trade “game,” no one has done more to advance its causes…
But that’s where some complexities arise. Starbucks is a “good company” and even a better company to work for. They treat their employees well. We have numerous folks at Quest Church that work at Starbucks and most very much enjoy their work there.
But the issue with Starbucks and any other big company [including churches as well] is that folks just don’t know where and when to stop. Capitalism and free market, at its core, isn’t a bad thing at all but its danger lies in thinking, convincing, and acting that bigger is always better; expansion is necessary and often times, the only sign of success. More, more, more. Growth and more growth. And the next thing you know, you end up selling breakfast burritos in your cafe and use automated machined where baristas don’t actually know how to make coffee.
Starbucks may have introduced and cultivated the concept of “third place culture” and once served superlative coffee – but no longer (in my humble opinion). When a coffee company produces mediocre coffee, that’s a problem. And when Howard Schultz (who sold out the Sonics!) says that they’re a “people company” – I have no idea what that means. Is Starbucks really a “people company?”
And while Starbucks is a great company to work for, they are a beast to compete against. And when Starbucks moves into the neighborhood, most local coffeeshops (outside the superlative ones) don’t have a fighting chance. You speak to any local or independent cafes, Starbucks is like Goliath. Why?
Some of the methods Starbucks has used to expand and maintain their dominant market position, such as buying out competitors’ leases, acquiring independent coffee shops and converting them into Starbucks stores, and clustering several locations in a small geographical area (i.e., saturating the market), have been labeled anti-competitive by critics. For example, Starbucks fueled its initial expansion into the UK market with a buyout of its only major potential competitor (the 49 outlet, UK-based Seattle Coffee Company), then used its capital and influence to obtain prime locations, some of which operated at a financial loss. Critics claimed this was an unfair attempt to drive out small, independent competitors, who could not afford to pay inflated prices for premium real estate. [wikipedia]
It’s always easy to take pot shots at the big companies. I get that and I’m not trying to take shots at Starbucks for the sake of taking shots at the biggest and baddest. Make no mistake about it: Starbucks is an incredible story. There’s much to celebrate and learn from. But that’s why I expect more and want more from the biggest and the baddest. But that’s another post.
While I think the 15th Avenue Coffee & Tea will be partly successful, I am hoping it fails. Why?
It’s not that I mean harm against Starbucks. Not at all. I want this experiment to fail because hints of success will only mean one thing: Expansion. And that may be good for Starbucks shareholders, but it won’t mean good news for neighborhood small businesses.
Coincidentally, the non-profit community cafe I helped found and serve as the Executive Director is located on 15th Avenue (another part of Seattle) and I have suspicion that if these experimental stores are a “success” for Starbucks, they’ll be moving into the neighborhood soon by converting their current Starbucks into another 15th Avenue Coffee & Tea.
Here’s another person’s thoughts from Peter Merholz via Harvard Business Publishing:
But 15th Ave Coffee & Tea is an experiment doomed to failure, because there’s no way a corporate coffee chain can create an authentic neighborhood coffeehouse experience. Your favorite local coffeehouse is the product of someone’s passion, dedication, and probable borderline craziness. 15th Ave is the product of corporate product design and development. Read the introductory copy on the 15th Ave website:
Fresh roasted coffee. Tea picked from the far reaches of the world with care. Artisan baked breads and treats that are sure to delight. A little flair of Italia with some heavenly gelato or affogato. 15th Avenue Coffee and Tea brings these flavors of the world direct to your local neighborhood everyday.This is so transparently corporate marketing speak. Compare it to the website of my favorite San Francisco coffeehouse, Farley’s, which is amateurish (and I mean that by its Latin root: done for the love) and personal:
Roger Farley Hillyard broke his coffee pot back in 1988 and could not find a store to purchase a replacement part. After scouring the city, Farley’s was conceptualized as a coffee and tea store. Through various incarnations, the present day concept of creating a place of community for the community was developed….The character of Farley’s mirrors the uniqueness of the people and allows for a genuine and distinctive experience for everyone.Faking it is not a good strategy in bed or in retail.
Perhaps my biggest beef with 15th Ave is that it’s fundamentally dishonest. Everyone knows it’s run by Starbucks, but the website and the store do all they can to suggest it’s a true independent (though the high level of interior design suggests a bankroll out of the reach of most entrepreneurs).
Photos by Joshua Trujillo (Seattle PI)