My first visit to a Starbucks was many years ago, at the original store near Seattle’s Pike Place Market. My friend Tony and I had stopped by during a morning of watching flying fish in the Market. I pulled my camera out to take a picture of him standing in line because he was making funny faces at me, as he sometimes likes to do. But suddenly, a loud voice thundered across the room: “NO CAMERAS! NO CAMERAS!” An irate barista in the now-familiar dark green Starbucks apron pointed at me and my evil camera. Despite protests that I was only taking an innocent shot of Tony and not engaged in corporate espionage, he was visibly upset.
Today’s corporate Starbucks seems far less concerned about protecting the mysteries of that corporate branding, and more about slumping revenues, aggressive competitors, and declining market share. In fact, Starbucks has recently, quietly and without fanfare opened another coffee shop. Not unusual for Starbucks, you may think, who now have about 16,000 locations in 43 countries worldwide.
Well, this one is unusual. No carbon copy urban-chic decor that tells you instantly you’ve just walked into Starbucks. Instead, 15th Avenue Coffee and Tea in Seattle’s leafy Capitol Hill neighbourhood looks and feels like one of those comfy, independently-owned neighbourhood cafés, nothing like your average signature Starbucks. They’re also serving wine and beer there, and offering lots of live music and book signings and other community events to draw their neighbours in. There is no signage, no logo, nothing at all to remind you that this little shop is wholly-owned by the world’s biggest coffee vendor. As one reviewer describes it:
“Ethically speaking, it’s a ‘Mom & Pop’ designed to snuff out other ‘Mom & Pops’. I find it ironic to see a store designed like all of the small shops that Starbucks has put out of business.”
In spite of the deliberate attempt to hide the fact that this is indeed still a Starbucks store, a sampling of original comments in the 15th Avenue’s new blog showed that savvy Seattelites do know their java:
“You are Starbucks – why the deception?”
“Is 15th Avenue Coffee & Tea owned by Starbucks?”
“Why did they take the Starbucks name off, when you’re still a Starbucks?
“You’re a Starbucks, so why all the cloak and dagger with trying to be an indy? I’d have more respect if you just came out and branded it with the old logo. Focus on the core, the coffee. Seriously, as a shareholder, this store and this move is a disappointment.”
“How sad this sham is! Starbucks’ service has gone to the devil, and the best idea you have is to start a fake independent coffee shop? Howard, time to retire.”
“For some reason, my post asking about whether or not 15th Ave. Coffee & Tea was owned by Starbucks was deleted. So, I’ll ask it again… are you owned by Starbucks?”
“Yes, we are owned by Starbucks:)” – (finally posted by manager signed only as “Jenna”)
What’s going on over there at Starbucks? We might have seen ‘Mom-and-PopBucks’ coming had we all read this 2007 company memo called The Commoditization of the Starbucks Experience. It was written by then-Chair Howard Schultz to then-CEO Jim Donald (before Schultz replaced Donald last year in a Starbucks corporate restructuring move). The memo included his brutally revealing assessment of the troubled company’s flawed business and marketing evolution:
Memo from: Howard Schultz, Starbucks Chair February 14, 2007 10:39 PST
Sent to: Jim Donald, Starbucks CEO
“Many of these decisions (to change) 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.
“For example, 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 new 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. This, coupled with the need for fresh roasted coffee in every North America city and every international market, moved us toward the decision and the need for flavor locked packaging.
Again, the right decision at the right time, and once again I believe we overlooked the cause and the effect of flavor lock in our stores. We achieved fresh roasted bagged coffee, but at what cost? The loss of aroma — perhaps the most powerful non-verbal signal we had in our stores; the loss of our people scooping fresh coffee from the bins and grinding it fresh in front of the customer, and once again stripping the store of tradition and our heritage?
“Then we moved to store design. Clearly, we have had to streamline store design to gain efficiencies of scale and to make sure we had the return on investment 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.
In fact, I am not sure people today even know that we are roasting coffee. You certainly can’t get the message from being in our stores. The merchandise, more art than science, is far removed from being the merchant that I believe we can be, and certainly at a minimum should support the foundation of our coffee heritage.”
Oh, and those gorgeous La Marzocca espresso machines, hand made in Florence since 1927 and, as Mr. Schultz pointed out in his memo, gone conspicuously missing from the current corporate Starbucks business plan? There’s one of these jewels holding pride of place at the 15th Avenue store.
If you’re in Seattle, check out 15th Avenue Coffee and Tea for yourself and let us know what you think. And see if their lengthy coffee menu still includes only one single fair trade and one organic line of beans. Find them at 328 15th Avenue East. You can also visit their website or read this Bloomberg business article.