INNOVATE

What You Can Learn from Starbucks

Advertisement

Maybe it's because I've just spent some time in London, Paris, and Berlin -- and have seen the cultural success of Starbucks in locales whose immune systems would have been thought to reject this American intrusion. Even so -- and despite the fact that torrents have already been written about this brand -- there is still a lot we can all learn from it.

So here are some marketing lessons to take to heart, in vente sized portions, of course.

Focus on the experience. Starbucks is masterful at wrapping its product in a deeply-textured gestalt. The choice of furniture and fixtures, the names of its drinks, the messages on the cups, the graphics, it's all been studiously crafted. My local Starbucks in New York City even has a little tray at the register with the business cards of the manager and the assistant manager. Very clever. Makes them feel good, and it lets customers know that someone is in charge and accountable no less -- an increasingly rare commodity in today's retail environment.

In short, there are no throwaways at Starbucks, and there shouldn't be at your company, either. Indeed, every business -- no matter how narrow the niche -- creates one experience or another around its customer interaction, its unique ecosystem. Think of your business in those terms, because attention to the small things sends a big message. It says that you really value your customers, that you credit them with the sensitivity to recognize the proliferation of quality and discipline. And -- importantly -- that you don't take them for granted.

Pay attention to your "brand consciousness." F. Scott Fitzgerald -- on the first page of The Great Gatsby -- defined personality as an "unbroken string of successful gestures." Starbucks has got this down to a science; it's what's behind the experience I talk about earlier. The brand has a distinct and recognizable voice, and through that syntax it radiates a clear and alluring identity, as well as a smart understanding of its customers--their values, their lifestyles, their needs.

Why else, in heaven's name, would someone care what music "we're listening to" -- as they put it? Would you value the musical tastes of GM? Of Hewlett-Packard? Or of Dunkin' Donuts, for that matter?

I don't think so. But we respect Starbucks' opinion because when it says "we," it means something to us. Starbucks has earned it, through a shared sensibility. Is that true of your business? What would it take to make it true? Imagine if you could become a valued partner outside the narrow niche you compete in, because your judgment and taste and continued ability to surprise and please were trusted implicitly. That's marketing power.

Don't try to squeeze every last cent out of a customer. Imagine the radical illogic: you can sit for five hours with a single cup of coffee. An MBA culture would never allow this -- it would be busy calculating the pathetic ROI on this customer loitering, analyzing the time value of the real estate, dividing it by the marginal cost of the coffee, and soon recommending that Starbucks charge by the hour, like a parking garage.

The truth is, though, that the comfortable chairs and couches have turned out to be a counterintuitive economic asset. They create loyalty. They drive business that might otherwise go elsewhere. They contribute to multiple customers gathering -- and spending.

Are you too wrapped up in "monetizing" your customers, instead of creating a business environment where they don't feel like a spending gun is always being held to their heads? Remarkable things will happen when you demonstrate some patience and confidence; confidence that if treated well, your customers will come back even if you're not the cheapest cup of coffee in town.

Don't accept conventional price ceilings. Industry experts (and consumer research) would have killed the idea before it started. I can hear the objections now: No one would ever pay $1.75 for a cup of coffee they can buy for 85 cents -- not to mention a $3 specialty drink. The concept is too sophisticated for Americans. People are in too much of a hurry to stay and linger. They'll try it once and never come back.

In today's hyper price-sensitive world, where all of us are faced with driving down costs every day, it's easy to forget that markets -- if developed properly -- have more upward elasticity than many give them credit for. Of course, commanding this higher price demands relentless attention to the brand delivery system I've been talking about.

Pastiche is powerful. Starbucks is a master at recombinant cultural marketing. There's a bit of America: The name, for one, is out of Moby Dick, a quintessentially American novel. The multiplicity of beverage choices -- and endless customization potential -- is also an acknowledgement of our uniquely empowered (and opinionated) consumer. Of course, there's a savvy bit of Italy: the barista, the faux Italian drink names, the entire caf é gestalt.

Finally, there's a global, New Age-y feel to the entire experience: the environmental sensibility, the focus on "fair trade," the conscious availability of soy milk, even the way Starbucks markets the company as a progressive employer (health insurance for part-timers).

But if you're not in the coffee shop business, how relevant is this to you? Very. We're an increasingly diverse culture -- consumer and business -- so you need to make sure your company is sending the right signals. This can be from every level: conceptually, product-wise, graphically, from a personnel perspective.

The other thing, of course, is that Starbucks venerates its product. And that's contagious. So next time you're facing a business dilemma, leave your desk, get in your car -- or take a walk -- to the nearest Starbucks. You could learn something.

Last updated: Apr 1, 2005




Register on Inc.com today to get full access to:
All articles  |  Magazine archives | Livestream events | Comments
EMAIL
PASSWORD
EMAIL
FIRST NAME
LAST NAME
EMAIL
PASSWORD

Or sign up using: