The Next Starbucks. That's part of the bold title of a feature story in the January 2001 issue of Inc. magazine. The article profiles Moonstruck Chocolatier, based in Portland, Ore., a small retailer of chocolates and chocolate drinks whose founders hope to grow the company substantially -- using Starbucks as a role model. "The more we poked at the Starbucks model, the better it looked," says Bill Simmons, who cofounded Moonstruck with his wife Deb (and with help from John Schouten, a marketing professor at the University of Portland). Bill Simmons wondered what other commodity could, like coffee, command a cult following. The Simmonses' answer? Chocolate.
Like many start-ups, Moonstruck faces long odds as it seeks to grow its company and its brand. But -- setting aside the question of Moonstruck's chances -- what is it about Starbucks that people find so worthy of imitation? "They've taken an everyday product, jazzed it up, and made it something special," says Arthur Thompson, a professor of business strategy at the University of Alabama who has written a case study about Starbucks.
Is it smart for a start-up to imitate another company? Thompson says that copying a successful company's business model and applying it to a new market can be an effective start-up strategy. When one company invokes the name of another successful one, "you can fairly quickly grasp what the vision is," echoes well-known management thinker Jim Collins. Making an analogy can result in a vivid goal -- and energize the mission. "'Doing for chocolate what Starbucks did for coffee.' Bang, that's it -- that's all you need to know," says Collins. "That's a much richer encapsulation of what they're about than saying, 'Well, we're going to grow to $1 billion in sales."
Collins is coauthor, with Jerry Porras, of the popular business book Built to Last: Successful Habits of Visionary Companies, which examines the traits of very successful, long-lasting companies. Collins posits that such companies often adopt what he calls "big, hairy, audacious goals" (BHAGs) -- ambitious missions that energize the companies. He believes that there are four basic types of BHAGs, and the "role model" BHAG -- a company striving to become the Starbucks or McDonald's of its industry -- is one of the four. "One company will pick an appropriate model as a standard to work toward, just as one person might pick another to emulate in life," he explains.
Will Moonstruck succeed in its bold goal? Read the full story -- from the January 2001 issue of Inc. magazine -- to find out more about the young start-up and its strategy. --Reported by Edward O. Welles
Six Lessons from Starbucks
What can you learn from Starbucks? A trip through the Inc. magazine archives reveals that, as far back as 1992, we took note of the Seattle company's innovative benefits policy for part-timers as well as its mail-order strategy. In 1993, Inc. examined Starbucks' benefits policies more fully, and we also included Starbucks as part of a story about in-house training programs. Later, in 1996, an expert commented on the power of Starbucks' strategic focus, and in 1998, Starbucks CEO Howard Schultz talked with Inc. about the critical importance of employee orientation. --Martha E. Mangelsdorf
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