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Date: 23 Feb 2007 16:42:58
From: BillK
Subject: Flash: Starbucks Suffers Experience Dilution
FYI, from today's WSJ.com:

Schultz Cautions Executives
Of Risks to Starbucks Brand
By JANET ADAMY
February 23, 2007 6:59 p.m.

In a blunt memo to executives, Starbucks Corp. Chairman Howard Schultz
warned that the fast-growing chain may be commoditizing its brand and
becoming more vulnerable to competition from other coffee shops and
fast-food chains.

Mr. Schultz sent the memo to top Starbucks executives on Feb. 14. in
an email with the subject line "The Commoditization of the Starbucks
Experience." It first appeared on the Web site starbucksgossip.com. A
Starbucks spokeswoman confirmed the memo's authenticity.

"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," Mr. Schultz wrote in the memo.

"Many of these decisions were probably right at the time, and on their
own merit would not have created the dilution of the experience; but
in this case, the sum is much greater and, unfortunately, much more
damaging than the individual pieces," he wrote.

Mr. Schultz went on to write that when the company switched to
automatic espresso machines - which are now in thousands of its stores
- "we solved a major problem in terms of speed of service and
efficiency," he wrote. "At the same time, we overlooked the fact that
we would remove much of the romance and theatre." Starbucks used to
have all its baristas pull espresso shots by hand.

That move "became even more damaging" because the new automatic
machines "blocked the visual sight line the customer previously had to
watch the drink being made, and for the intimate experience with the
barista," he wrote.

Mr. Schultz wrote that Starbucks switched to a "flavor locked
packaging" for its coffees that eliminated the task of scooping fresh
coffee from bins in stores and grinding it in front of customers. "We
achieved fresh roasted bagged coffee, but at what cost?" Mr. Schultz
wrote. "The loss of aroma -- perhaps the most powerful non-verbal
signal we had in our stores."

Mr. Schultz also wrote that changes in the store design process had
created "stores that no longer have the soul of the past ... Some people
even call our stores sterile, cookie cutter," he wrote.

"While the current state of affairs for the most part is self induced,
that has lead to competitors of all kinds, small and large coffee
companies, fast food operators, and mom and pops, to position
themselves in a way that creates awareness, trial and loyalty of
people who previously have been Starbucks customers. This must be
eradicated," he wrote."

"Let's be ster about how we are spending our time, money and
resources," Mr. Schultz wrote toward the end of the memo. "Let's get
back to the core."

Starbucks spokeswoman Valerie O'Neil said the memo is "a reminder of
how success is not an entitlement. It has to be earned every day," she
said. "We can't embrace the status quo."





 
Date: 26 Feb 2007 07:07:15
From: daveb
Subject: Re: Flash: Starbucks Suffers Experience Dilution

>
> I've often heard this silly argument - SB's raised the "bar" meaning
> they raised awareness about coffee. No.


Admit it or not -- Starbucks HAS raised awareness of better coffee
than the cheap, watery swill served at restaurants, coffee shops at
the office and at home.

this is a GOOD thing.

and in re: the health gambit?

you can kill yourself w/ Mcdonalds food or you can eat st.
same same at Starbucks

Dave
www.hitechespsresso.com





 
Date: 26 Feb 2007 06:46:07
From: karlseidel
Subject: Re: Flash: Starbucks Suffers Experience Dilution
On Feb 25, 9:08 am, "Jack Denver" <nunuv...@netscape.net > wrote:
> Although Starbucks "signature" style is darker than many here prefer, it was
> a conscious decision early on (one that they have stuck to) and has nothing
> to do with the quality of the beans that they start with (which has stayed
> pretty high considering the amount that they buy and considering that they
> could probably "cheat" without many people noticing). The idea was (and is)
> to be "different" than say Dunkin Donuts and to associate in the public's
> mind - light roast = Maxwell House, dark roast = "European sophistication".
> Also by roasting everything the same and destroying all varietal character,
> you get a coffee that "tastes like Starbucks" no matter what blend you
> choose. Now that may sound appalling to you, but it makes sense from a brand
> loyalty POV.

Brand loyalty/schmoyalty - they realized that they could offer a
product that people would buy because most people don't know good
coffee from bad. Consumers generally don't know how to taste for the
sweet uniqueness that coffee can offer so the real question doesn't
enter the minds of most consumers. Then sugar is added, flavor is
added, whipped cream is added, ice is added...are you starting to get
the picture here: Twinkies and Suzy-Q's in the form of drinks with a
coffee-flavored base.

I've often heard this silly argument - SB's raised the "bar" meaning
they raised awareness about coffee. No. SB's took the other path: give
people what they want: coffee flavor glommed over with sweet sticky
stuff so going to SB's is an experience - like going to Swenson's or
Baskin-Robbins. Confections rule! Who didn't know that? We live in a
country full of fat diabetics!

Over-roasted coffee, burnt toast & overcooked onions all have a
distinctive flavor - it's called burnt. I realize it was a conscious
decision by SB's - and only someone who has not had the experience of
a sweet tasty consciously freshly roasted coffee can enjoy burnt SB's.
It's criminal to consciously offer over-roasted low grade coffee but
most people in the world have been trained to accept sub-par
comestibles - SB's, McD's, etc.
>
> One could imagine an alternative world chain just like Starbucks that used
> the same dark roast but stuck to traditional machines and grinders - one has
> nothing to do with the other or with the point that Schultz was making. I'm
> not sure what the fact that instant is popular has to do with this. Schultz
> is no "elitist" - elitists don't make billions. Starbucks appeals to a wide
> audience as an "affordable luxury" - my cleaning lady from the ghetto of
> West Philadelphia talks about stopping at Starbucks.

I may not have phrased my original response clearly enough - I'm
talking about us - the people writing on alt.coffee being elitist -
not your cleaning woman who has obviously bought the image that SB's
offers - that there's some pretension of gourmet in what SB's offers
in the way of coffee.
>
> In terms of a "knowledgeable person", when I am in my home area I know
> where to get coffee (mostly my house but a few selected spots) and I
> wouldn't usually go to a Starbucks (though I admit I've gone there a couple
> of time even locally when I've had to "kill time" in between two
> appointments and needed a place to get off the street for a little while -
> their cafes do offer a comfortable experience.

No debate here - I go there occasionally with friends - they're
convenient and comfortable and they now sell Izze Drinks so I have an
alternative drink to order.

Even if the coffee at
> McDonalds is better, you have the stink of the fryers and disinfectant and
> the screaming little kids and the hard seats designed to get you out as fast
> as possible) . But if I am traveling in an unfamiliar place (in the US)
> the coffee you get at Starbucks is better than what you could expect by
> picking a randomly coffee shop. The switch to supers has enhanced this in
> that while the shots are never great they are not usually totally off target
> either, at least if the tech has been in to see the machine recently.
>
> "karlseidel" <karl.sei...@gmail.com> wrote in message
>
> news:1172420844.907072.101150@j27g2000cwj.googlegroups.com...
>
> > Despite the fact that the realization came from Schultz's pen the real
> > issue has to do with the quality of coffee being roasted - not the
> > fact that the store experience has become diluted. Most people want
> > consistency - quality of coffee and roast style is not an issue -
> > otherwise SB's could not have flourished.
>
> > I think SB's should embrace the fact that they are the McD's of coffee
> > - because it's unrealistic to go back to their roots and offer a
> > quality coffee.
>
> > Hell, most of the people who read this can probably roast a better
> > tasting coffee than SB's - that's definitely not the issue or the
> > concern of Schultz. He just wants people to keep coming back and
> > paying for the SB's experience which has to do with offering a
> > confectionary drink and a snack or a sandwich at premium prices.
> > What's the matter with that?
>
> > It's funny too because despite what Schultz or any other specialty
> > coffee purveyor says the vast majority of humans still drink drek
> > daily - typically spray-dried coffee of the cheapest variety. So this
> > kind of elitist dialog is at best a lament - nothing more.
>
> > I think Schultz's winnings have made his thinking fog up a bit. Nobody
> > but him and his yes-people could possibly look at this new empire and
> > say we're the best of breed and we roast the finest coffee in the
> > world! If you're really interested in drinking great coffee and having
> > a gourmet experience what knowledgeable person would go to SB's?
>
> > Hey Howard - enjoy your profits and wake up and smell the burnt
> > coffee!
>
> > On Feb 23, 4:42 pm, "BillK" <rcgol...@gmail.com> wrote:
> >> FYI, from today's WSJ.com:
>
> >> Schultz Cautions Executives
> >> Of Risks to Starbucks Brand
> >> By JANET ADAMY
> >> February 23, 2007 6:59 p.m.
>
> >> In a blunt memo to executives, Starbucks Corp. Chairman Howard Schultz
> >> warned that the fast-growing chain may be commoditizing its brand and
> >> becoming more vulnerable to competition from other coffee shops and
> >> fast-food chains.
>
> >> Mr. Schultz sent the memo to top Starbucks executives on Feb. 14. in
> >> an email with the subject line "The Commoditization of the Starbucks
> >> Experience." It first appeared on the Web site starbucksgossip.com. A
> >> Starbucks spokeswoman confirmed the memo's authenticity.
>
> >> "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," Mr. Schultz wrote in the memo.
>
> >> "Many of these decisions were probably right at the time, and on their
> >> own merit would not have created the dilution of the experience; but
> >> in this case, the sum is much greater and, unfortunately, much more
> >> damaging than the individual pieces," he wrote.
>
> >> Mr. Schultz went on to write that when the company switched to
> >> automatic espresso machines - which are now in thousands of its stores
> >> - "we solved a major problem in terms of speed of service and
> >> efficiency," he wrote. "At the same time, we overlooked the fact that
> >> we would remove much of the romance and theatre." Starbucks used to
> >> have all its baristas pull espresso shots by hand.
>
> >> That move "became even more damaging" because the new automatic
> >> machines "blocked the visual sight line the customer previously had to
> >> watch the drink being made, and for the intimate experience with the
> >> barista," he wrote.
>
> >> Mr. Schultz wrote that Starbucks switched to a "flavor locked
> >> packaging" for its coffees that eliminated the task of scooping fresh
> >> coffee from bins in stores and grinding it in front of customers. "We
> >> achieved fresh roasted bagged coffee, but at what cost?" Mr. Schultz
> >> wrote. "The loss of aroma -- perhaps the most powerful non-verbal
> >> signal we had in our stores."
>
> >> Mr. Schultz also wrote that changes in the store design process had
> >> created "stores that no longer have the soul of the past ... Some people
> >> even call our stores sterile, cookie cutter," he wrote.
>
> >> "While the current state of affairs for the most part is self induced,
> >> that has lead to competitors of all kinds, small and large coffee
> >> companies, fast food operators, and mom and pops, to position
> >> themselves in a way that creates awareness, trial and loyalty of
> >> people who previously have been Starbucks customers. This must be
> >> eradicated," he wrote."
>
> >> "Let's be ster about how we are spending our time, money and
> >> resources," Mr. Schultz wrote toward the end of the memo. "Let's get
> >> back to the core."
>
> >> Starbucks spokeswoman Valerie O'Neil said the memo is "a reminder of
> >> how success is not an entitlement. It has to be earned every day," she
> >> said. "We can't embrace the status quo."




  
Date: 26 Feb 2007 21:19:48
From: Marshall
Subject: Re: Flash: Starbucks Suffers Experience Dilution
On 26 Feb 2007 06:46:07 -0800, "karlseidel" <karl.seidel@gmail.com >
wrote:

>I've often heard this silly argument - SB's raised the "bar" meaning
>they raised awareness about coffee. No. SB's took the other path: give
>people what they want: coffee flavor glommed over with sweet sticky
>stuff so going to SB's is an experience - like going to Swenson's or
>Baskin-Robbins. ...

No, they took both paths, at least in their early and middle years.
Starbucks also taught a lot of people there were better alternatives
to superket cans and the generic restaurant-supply, pillow-packed,
pre-ground coffee, left standing on a hot-plate as served by most
commercial establishments. Before Starbucks, most people thought
coffee was supposed to taste bad.

>Over-roasted coffee, burnt toast & overcooked onions all have a
>distinctive flavor - it's called burnt. I realize it was a conscious
>decision by SB's - and only someone who has not had the experience of
>a sweet tasty consciously freshly roasted coffee can enjoy burnt SB's.
>It's criminal to consciously offer over-roasted low grade coffee ...

If you think Starbucks roasts "low grade coffee," there are some very
well-known companies I'd like to introduce you to. I've never heard a
knowledgeable person call Starbucks' beans "low grade."

shall


   
Date: 27 Feb 2007 15:39:39
From: Mr A Nonymous
Subject: Re: Flash: Starbucks Suffers Experience Dilution
>>Over-roasted coffee, burnt toast & overcooked onions all have a
>>distinctive flavor - it's called burnt. I realize it was a conscious
>>decision by SB's - and only someone who has not had the experience of
>>a sweet tasty consciously freshly roasted coffee can enjoy burnt SB's.
>>It's criminal to consciously offer over-roasted low grade coffee ...
>
> If you think Starbucks roasts "low grade coffee," there are some very
> well-known companies I'd like to introduce you to. I've never heard a
> knowledgeable person call Starbucks' beans "low grade."
>
> shall

I recall chasing a particular bean to be told "sorry don't count on that
one, *$ bought the crop, and will continue to"





 
Date: 25 Feb 2007 08:27:24
From: karlseidel
Subject: Re: Flash: Starbucks Suffers Experience Dilution
Despite the fact that the realization came from Schultz's pen the real
issue has to do with the quality of coffee being roasted - not the
fact that the store experience has become diluted. Most people want
consistency - quality of coffee and roast style is not an issue -
otherwise SB's could not have flourished.

I think SB's should embrace the fact that they are the McD's of coffee
- because it's unrealistic to go back to their roots and offer a
quality coffee.

Hell, most of the people who read this can probably roast a better
tasting coffee than SB's - that's definitely not the issue or the
concern of Schultz. He just wants people to keep coming back and
paying for the SB's experience which has to do with offering a
confectionary drink and a snack or a sandwich at premium prices.
What's the matter with that?

It's funny too because despite what Schultz or any other specialty
coffee purveyor says the vast majority of humans still drink drek
daily - typically spray-dried coffee of the cheapest variety. So this
kind of elitist dialog is at best a lament - nothing more.

I think Schultz's winnings have made his thinking fog up a bit. Nobody
but him and his yes-people could possibly look at this new empire and
say we're the best of breed and we roast the finest coffee in the
world! If you're really interested in drinking great coffee and having
a gourmet experience what knowledgeable person would go to SB's?

Hey Howard - enjoy your profits and wake up and smell the burnt
coffee!

On Feb 23, 4:42 pm, "BillK" <rcgol...@gmail.com > wrote:
> FYI, from today's WSJ.com:
>
> Schultz Cautions Executives
> Of Risks to Starbucks Brand
> By JANET ADAMY
> February 23, 2007 6:59 p.m.
>
> In a blunt memo to executives, Starbucks Corp. Chairman Howard Schultz
> warned that the fast-growing chain may be commoditizing its brand and
> becoming more vulnerable to competition from other coffee shops and
> fast-food chains.
>
> Mr. Schultz sent the memo to top Starbucks executives on Feb. 14. in
> an email with the subject line "The Commoditization of the Starbucks
> Experience." It first appeared on the Web site starbucksgossip.com. A
> Starbucks spokeswoman confirmed the memo's authenticity.
>
> "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," Mr. Schultz wrote in the memo.
>
> "Many of these decisions were probably right at the time, and on their
> own merit would not have created the dilution of the experience; but
> in this case, the sum is much greater and, unfortunately, much more
> damaging than the individual pieces," he wrote.
>
> Mr. Schultz went on to write that when the company switched to
> automatic espresso machines - which are now in thousands of its stores
> - "we solved a major problem in terms of speed of service and
> efficiency," he wrote. "At the same time, we overlooked the fact that
> we would remove much of the romance and theatre." Starbucks used to
> have all its baristas pull espresso shots by hand.
>
> That move "became even more damaging" because the new automatic
> machines "blocked the visual sight line the customer previously had to
> watch the drink being made, and for the intimate experience with the
> barista," he wrote.
>
> Mr. Schultz wrote that Starbucks switched to a "flavor locked
> packaging" for its coffees that eliminated the task of scooping fresh
> coffee from bins in stores and grinding it in front of customers. "We
> achieved fresh roasted bagged coffee, but at what cost?" Mr. Schultz
> wrote. "The loss of aroma -- perhaps the most powerful non-verbal
> signal we had in our stores."
>
> Mr. Schultz also wrote that changes in the store design process had
> created "stores that no longer have the soul of the past ... Some people
> even call our stores sterile, cookie cutter," he wrote.
>
> "While the current state of affairs for the most part is self induced,
> that has lead to competitors of all kinds, small and large coffee
> companies, fast food operators, and mom and pops, to position
> themselves in a way that creates awareness, trial and loyalty of
> people who previously have been Starbucks customers. This must be
> eradicated," he wrote."
>
> "Let's be ster about how we are spending our time, money and
> resources," Mr. Schultz wrote toward the end of the memo. "Let's get
> back to the core."
>
> Starbucks spokeswoman Valerie O'Neil said the memo is "a reminder of
> how success is not an entitlement. It has to be earned every day," she
> said. "We can't embrace the status quo."




  
Date: 25 Feb 2007 17:58:44
From: Marshall
Subject: Re: Flash: Starbucks Suffers Experience Dilution
On 25 Feb 2007 08:27:24 -0800, "karlseidel" <karl.seidel@gmail.com >
wrote:

>Despite the fact that the realization came from Schultz's pen the real
>issue has to do with the quality of coffee being roasted - not the
>fact that the store experience has become diluted. Most people want
>consistency - quality of coffee and roast style is not an issue -
>otherwise SB's could not have flourished.

When your competition is semi-generic pillowpack coffee brewed by a
diner that lets it sit all day on a hot plate, a cup of Starbucks is
truly the gourmet alternative. The green beans are better, the roast
is better, the roast is fresher and the brew is definitely fresher.
But Starbucks has come up against higher quality competition in some
kets, and they will need to deal with it.

shall


  
Date: 25 Feb 2007 12:08:09
From: Jack Denver
Subject: Re: Flash: Starbucks Suffers Experience Dilution
Although Starbucks "signature" style is darker than many here prefer, it was
a conscious decision early on (one that they have stuck to) and has nothing
to do with the quality of the beans that they start with (which has stayed
pretty high considering the amount that they buy and considering that they
could probably "cheat" without many people noticing). The idea was (and is)
to be "different" than say Dunkin Donuts and to associate in the public's
mind - light roast = Maxwell House, dark roast = "European sophistication".
Also by roasting everything the same and destroying all varietal character,
you get a coffee that "tastes like Starbucks" no matter what blend you
choose. Now that may sound appalling to you, but it makes sense from a brand
loyalty POV.

One could imagine an alternative world chain just like Starbucks that used
the same dark roast but stuck to traditional machines and grinders - one has
nothing to do with the other or with the point that Schultz was making. I'm
not sure what the fact that instant is popular has to do with this. Schultz
is no "elitist" - elitists don't make billions. Starbucks appeals to a wide
audience as an "affordable luxury" - my cleaning lady from the ghetto of
West Philadelphia talks about stopping at Starbucks.

In terms of a "knowledgeable person", when I am in my home area I know
where to get coffee (mostly my house but a few selected spots) and I
wouldn't usually go to a Starbucks (though I admit I've gone there a couple
of time even locally when I've had to "kill time" in between two
appointments and needed a place to get off the street for a little while -
their cafes do offer a comfortable experience. Even if the coffee at
McDonalds is better, you have the stink of the fryers and disinfectant and
the screaming little kids and the hard seats designed to get you out as fast
as possible) . But if I am traveling in an unfamiliar place (in the US)
the coffee you get at Starbucks is better than what you could expect by
picking a randomly coffee shop. The switch to supers has enhanced this in
that while the shots are never great they are not usually totally off target
either, at least if the tech has been in to see the machine recently.






"karlseidel" <karl.seidel@gmail.com > wrote in message
news:1172420844.907072.101150@j27g2000cwj.googlegroups.com...
> Despite the fact that the realization came from Schultz's pen the real
> issue has to do with the quality of coffee being roasted - not the
> fact that the store experience has become diluted. Most people want
> consistency - quality of coffee and roast style is not an issue -
> otherwise SB's could not have flourished.
>
> I think SB's should embrace the fact that they are the McD's of coffee
> - because it's unrealistic to go back to their roots and offer a
> quality coffee.
>
> Hell, most of the people who read this can probably roast a better
> tasting coffee than SB's - that's definitely not the issue or the
> concern of Schultz. He just wants people to keep coming back and
> paying for the SB's experience which has to do with offering a
> confectionary drink and a snack or a sandwich at premium prices.
> What's the matter with that?
>
> It's funny too because despite what Schultz or any other specialty
> coffee purveyor says the vast majority of humans still drink drek
> daily - typically spray-dried coffee of the cheapest variety. So this
> kind of elitist dialog is at best a lament - nothing more.
>
> I think Schultz's winnings have made his thinking fog up a bit. Nobody
> but him and his yes-people could possibly look at this new empire and
> say we're the best of breed and we roast the finest coffee in the
> world! If you're really interested in drinking great coffee and having
> a gourmet experience what knowledgeable person would go to SB's?
>
> Hey Howard - enjoy your profits and wake up and smell the burnt
> coffee!
>
> On Feb 23, 4:42 pm, "BillK" <rcgol...@gmail.com> wrote:
>> FYI, from today's WSJ.com:
>>
>> Schultz Cautions Executives
>> Of Risks to Starbucks Brand
>> By JANET ADAMY
>> February 23, 2007 6:59 p.m.
>>
>> In a blunt memo to executives, Starbucks Corp. Chairman Howard Schultz
>> warned that the fast-growing chain may be commoditizing its brand and
>> becoming more vulnerable to competition from other coffee shops and
>> fast-food chains.
>>
>> Mr. Schultz sent the memo to top Starbucks executives on Feb. 14. in
>> an email with the subject line "The Commoditization of the Starbucks
>> Experience." It first appeared on the Web site starbucksgossip.com. A
>> Starbucks spokeswoman confirmed the memo's authenticity.
>>
>> "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," Mr. Schultz wrote in the memo.
>>
>> "Many of these decisions were probably right at the time, and on their
>> own merit would not have created the dilution of the experience; but
>> in this case, the sum is much greater and, unfortunately, much more
>> damaging than the individual pieces," he wrote.
>>
>> Mr. Schultz went on to write that when the company switched to
>> automatic espresso machines - which are now in thousands of its stores
>> - "we solved a major problem in terms of speed of service and
>> efficiency," he wrote. "At the same time, we overlooked the fact that
>> we would remove much of the romance and theatre." Starbucks used to
>> have all its baristas pull espresso shots by hand.
>>
>> That move "became even more damaging" because the new automatic
>> machines "blocked the visual sight line the customer previously had to
>> watch the drink being made, and for the intimate experience with the
>> barista," he wrote.
>>
>> Mr. Schultz wrote that Starbucks switched to a "flavor locked
>> packaging" for its coffees that eliminated the task of scooping fresh
>> coffee from bins in stores and grinding it in front of customers. "We
>> achieved fresh roasted bagged coffee, but at what cost?" Mr. Schultz
>> wrote. "The loss of aroma -- perhaps the most powerful non-verbal
>> signal we had in our stores."
>>
>> Mr. Schultz also wrote that changes in the store design process had
>> created "stores that no longer have the soul of the past ... Some people
>> even call our stores sterile, cookie cutter," he wrote.
>>
>> "While the current state of affairs for the most part is self induced,
>> that has lead to competitors of all kinds, small and large coffee
>> companies, fast food operators, and mom and pops, to position
>> themselves in a way that creates awareness, trial and loyalty of
>> people who previously have been Starbucks customers. This must be
>> eradicated," he wrote."
>>
>> "Let's be ster about how we are spending our time, money and
>> resources," Mr. Schultz wrote toward the end of the memo. "Let's get
>> back to the core."
>>
>> Starbucks spokeswoman Valerie O'Neil said the memo is "a reminder of
>> how success is not an entitlement. It has to be earned every day," she
>> said. "We can't embrace the status quo."
>
>




   
Date: 25 Feb 2007 18:04:34
From: Marshall
Subject: Re: Flash: Starbucks Suffers Experience Dilution
On Sun, 25 Feb 2007 12:08:09 -0500, "Jack Denver"
<nunuvyer@netscape.net > wrote:

>One could imagine an alternative world chain just like Starbucks that used
>the same dark roast but stuck to traditional machines and grinders - one has
>nothing to do with the other or with the point that Schultz was making. I'm
>not sure what the fact that instant is popular has to do with this. Schultz
>is no "elitist" - elitists don't make billions. Starbucks appeals to a wide
>audience as an "affordable luxury" - my cleaning lady from the ghetto of
>West Philadelphia talks about stopping at Starbucks.

Their demographic is broader than it used to be, but they still target
the upwardly mobile. Even in "brownfields:"
http://www.brownfieldnews.com/archive/0412December/V8I5_starbucks.htm

shall


 
Date: 24 Feb 2007 10:47:47
From: rasqual
Subject: Re: Flash: Starbucks Suffers Experience Dilution
On Feb 23, 6:42 pm, "BillK" <rcgol...@gmail.com > wrote:
> Schultz Cautions Executives
> Of Risks to Starbucks Brand

> "While the current state of affairs for the most part is self induced,
> that has lead to competitors of all kinds, small and large coffee
> companies, fast food operators, and mom and pops, to position
> themselves in a way that creates awareness, trial and loyalty of
> people who previously have been Starbucks customers. This must be
> eradicated," he wrote."

The wolf howling at the door for Starbucks isn't competition, it's
their own decisions and business evolution. I think the memo's pretty
frank about that, but for my part there's also a sense in which the
will to dominate -- there's no room in the ket for indie shops as
alternatives to Starbucks' empire -- is starkly offensive.

Indie shops I enjoy are focused on doing a great job to please
customers and make a living. By the time you're Starbucks' size,
you've moved beyond that. It's no wonder customers turn elsewhere.

If nothing else, this demonstrates again that free ket competition
is good for everyone.

- Scott




 
Date: 24 Feb 2007 16:51:33
From: AZ Nomad
Subject: Re: Flash: Starbucks Suffers Experience Dilution
On 23 Feb 2007 16:42:58 -0800, BillK <rcgolfer@gmail.com > wrote:


>FYI, from today's WSJ.com:

>Schultz Cautions Executives
>Of Risks to Starbucks Brand
>By JANET ADAMY
>February 23, 2007 6:59 p.m.

>In a blunt memo to executives, Starbucks Corp. Chairman Howard Schultz
>warned that the fast-growing chain may be commoditizing its brand and
>becoming more vulnerable to competition from other coffee shops and
>fast-food chains.

If anything, starbucks has stagnated. They are as cookie cutter as McDonalds
and I haven't seen anything change in the last ten years. If anything, the only
change has been the fact that about half of their business is snackfood (scones,
etc.) Otherwise it's the same burnt cofee. Same pansyass candybar milkshakes.


 
Date: 24 Feb 2007 08:13:37
From: daveb
Subject: Re: Flash: Starbucks Suffers Experience Dilution
On Feb 24, 10:26 am, "Jack Denver" <nunuv...@netscape.net > wrote:
> Sounds like Starbucks is suffering from the Tin Woodsman syndrome - piece by
> piece they have replaced their parts with tin until they have lost their
> heart. By the time they noticed, it was too late. What wizard will give
> them their heart back?
>
> I suppose they could toss all the supers and go back to real espresso
> machines and grinders, but that would cost money, not only for the machines
> but for recruiting the trained staff needed to operate them, which was their
> reason for switching in the first place and would still be a problem.
> Romance and theatre is one thing and the reality of sullen unskilled
> teenage "baristas" is another. So don't look for real change, just more
> window dressing. Maybe they can put the aroma of coffee in a spray can and
> design an automatic dispenser to spritz the room every once in a while.
> They could put flat screen TVs on the front of their superautos and show
> movies of real espresso being made.
>

uh, 'Jack', based on many, many visits to starbucks over the years, I
cannot recall a SINGLE employee as "sullen" -- EVER.

which is a real credit to starbucks.

I have encountered plenty of "sullen", even rude, employees at other
'brand X' coffee establishments


So let's not go TOO far with the corollaries.

dave



 
Date: 24 Feb 2007 10:26:25
From: Jack Denver
Subject: Re: Flash: Starbucks Suffers Experience Dilution
Sounds like Starbucks is suffering from the Tin Woodsman syndrome - piece by
piece they have replaced their parts with tin until they have lost their
heart. By the time they noticed, it was too late. What wizard will give
them their heart back?

I suppose they could toss all the supers and go back to real espresso
machines and grinders, but that would cost money, not only for the machines
but for recruiting the trained staff needed to operate them, which was their
reason for switching in the first place and would still be a problem.
Romance and theatre is one thing and the reality of sullen unskilled
teenage "baristas" is another. So don't look for real change, just more
window dressing. Maybe they can put the aroma of coffee in a spray can and
design an automatic dispenser to spritz the room every once in a while.
They could put flat screen TVs on the front of their superautos and show
movies of real espresso being made.



"BillK" <rcgolfer@gmail.com > wrote in message
news:1172277778.335772.189530@8g2000cwh.googlegroups.com...
> FYI, from today's WSJ.com:
>
> Schultz Cautions Executives
> Of Risks to Starbucks Brand
> By JANET ADAMY
> February 23, 2007 6:59 p.m.
>
> In a blunt memo to executives, Starbucks Corp. Chairman Howard Schultz
> warned that the fast-growing chain may be commoditizing its brand and
> becoming more vulnerable to competition from other coffee shops and
> fast-food chains.
>
> Mr. Schultz sent the memo to top Starbucks executives on Feb. 14. in
> an email with the subject line "The Commoditization of the Starbucks
> Experience." It first appeared on the Web site starbucksgossip.com. A
> Starbucks spokeswoman confirmed the memo's authenticity.
>
> "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," Mr. Schultz wrote in the memo.
>
> "Many of these decisions were probably right at the time, and on their
> own merit would not have created the dilution of the experience; but
> in this case, the sum is much greater and, unfortunately, much more
> damaging than the individual pieces," he wrote.
>
> Mr. Schultz went on to write that when the company switched to
> automatic espresso machines - which are now in thousands of its stores
> - "we solved a major problem in terms of speed of service and
> efficiency," he wrote. "At the same time, we overlooked the fact that
> we would remove much of the romance and theatre." Starbucks used to
> have all its baristas pull espresso shots by hand.
>
> That move "became even more damaging" because the new automatic
> machines "blocked the visual sight line the customer previously had to
> watch the drink being made, and for the intimate experience with the
> barista," he wrote.
>
> Mr. Schultz wrote that Starbucks switched to a "flavor locked
> packaging" for its coffees that eliminated the task of scooping fresh
> coffee from bins in stores and grinding it in front of customers. "We
> achieved fresh roasted bagged coffee, but at what cost?" Mr. Schultz
> wrote. "The loss of aroma -- perhaps the most powerful non-verbal
> signal we had in our stores."
>
> Mr. Schultz also wrote that changes in the store design process had
> created "stores that no longer have the soul of the past ... Some people
> even call our stores sterile, cookie cutter," he wrote.
>
> "While the current state of affairs for the most part is self induced,
> that has lead to competitors of all kinds, small and large coffee
> companies, fast food operators, and mom and pops, to position
> themselves in a way that creates awareness, trial and loyalty of
> people who previously have been Starbucks customers. This must be
> eradicated," he wrote."
>
> "Let's be ster about how we are spending our time, money and
> resources," Mr. Schultz wrote toward the end of the memo. "Let's get
> back to the core."
>
> Starbucks spokeswoman Valerie O'Neil said the memo is "a reminder of
> how success is not an entitlement. It has to be earned every day," she
> said. "We can't embrace the status quo."
>




  
Date: 25 Feb 2007 21:42:18
From: Lavarock
Subject: Re: Flash: Starbucks Suffers Experience Dilution
Jack Denver wrote:
> Maybe they can put the aroma of coffee in a spray can and
> design an automatic dispenser to spritz the room every once in a while.
> They could put flat screen TVs on the front of their superautos and show
> movies of real espresso being made.
>
>

Reminds me of the Green Acres episode where Mr Haney sold a plastic
Christmas tree with the smell of pine, imitation sap that would ooze
out, the needles would turn dark and fall off... just like a REAL tree...

--

They said that someone has to live in Hawaii and I raised my hand first!


 
Date: 24 Feb 2007 01:33:39
From: daveb
Subject: Re: Flash: Starbucks Suffers Experience Dilution
On Feb 23, 7:42 pm, "BillK" <rcgol...@gmail.com > wrote:
> FYI, from today's WSJ.com:
>
> Schultz Cautions Executives
> Of Risks to Starbucks Brand
> By JANET ADAMY
> February 23, 2007 6:59 p.m.
>
> In a blunt memo to executives, Starbucks Corp. Chairman Howard Schultz
> warned that the fast-growing chain may be commoditizing its brand and
> becoming more vulnerable to competition from other coffee shops and
> fast-food chains.
>
> Mr. Schultz sent the memo to top Starbucks executives on Feb. 14. in
> an email with the subject line "The Commoditization of the Starbucks
> Experience." It first appeared on the Web site starbucksgossip.com. A
> Starbucks spokeswoman confirmed the memo's authenticity.
>
> "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," Mr. Schultz wrote in the memo.
>
> "Many of these decisions were probably right at the time, and on their
> own merit would not have created the dilution of the experience; but
> in this case, the sum is much greater and, unfortunately, much more
> damaging than the individual pieces," he wrote.
>
> Mr. Schultz went on to write that when the company switched to
> automatic espresso machines - which are now in thousands of its stores
> - "we solved a major problem in terms of speed of service and
> efficiency," he wrote. "At the same time, we overlooked the fact that
> we would remove much of the romance and theatre." Starbucks used to
> have all its baristas pull espresso shots by hand.
>
> That move "became even more damaging" because the new automatic
> machines "blocked the visual sight line the customer previously had to
> watch the drink being made, and for the intimate experience with the
> barista," he wrote.
>
> Mr. Schultz wrote that Starbucks switched to a "flavor locked
> packaging" for its coffees that eliminated the task of scooping fresh
> coffee from bins in stores and grinding it in front of customers. "We
> achieved fresh roasted bagged coffee, but at what cost?" Mr. Schultz
> wrote. "The loss of aroma -- perhaps the most powerful non-verbal
> signal we had in our stores."
>
> Mr. Schultz also wrote that changes in the store design process had
> created "stores that no longer have the soul of the past ... Some people
> even call our stores sterile, cookie cutter," he wrote.
>
> "While the current state of affairs for the most part is self induced,
> that has lead to competitors of all kinds, small and large coffee
> companies, fast food operators, and mom and pops, to position
> themselves in a way that creates awareness, trial and loyalty of
> people who previously have been Starbucks customers. This must be
> eradicated," he wrote."
>
> "Let's be ster about how we are spending our time, money and
> resources," Mr. Schultz wrote toward the end of the memo. "Let's get
> back to the core."
>
> Starbucks spokeswoman Valerie O'Neil said the memo is "a reminder of
> how success is not an entitlement. It has to be earned every day," she
> said. "We can't embrace the status quo."

NOT likely they'll dump those ^%#*I^&$# super automatics anytime
soon. -- the home of burnt and bitter espresso.

But not to worry, lots of the little guys are following suit. More
speed, less training, less skill; diagnosable and controllable over
the internet.

A damn shame

dave



  
Date: 24 Feb 2007 14:18:02
From: Bertie Doe
Subject: Re: Flash: Starbucks Suffers Experience Dilution

"daveb" > wrote in message

>> Mr. Schultz went on to write that when the company switched to
>> automatic espresso machines - which are now in thousands of its stores
>
> NOT likely they'll dump those ^%#*I^&$# super automatics anytime
> soon. -- the home of burnt and bitter espresso.
>
> But not to worry, lots of the little guys are following suit. More
> speed, less training, less skill; diagnosable and controllable over
> the internet.
>
> A damn shame
>
> dave
>
Machines, beans, decor etc are Schultz's decision alone, so why the need for
a memo? I don't suppose area managers could make major changes - even if
they wanted to.
Bertie