Don't Mess With My Coffee

I get coffee from Starbucks every morning on the way to work. A couple of weeks ago they unveiled their new (old) Pike Place coffee. I guess it is the coffee they first roasted and served in Seattle back in the early days. They are using this coffee as a way to "get back to their roots" I think. They have Pike's Place as the everyday coffee and usually offer one other type of coffee as well.

But their are several problems - one strategic, several tactical.


Don't Ignore Your Base
Politics 101 says, do not abandon the base in search of new voters unless you know the base has no where else to go......Starbucks is looking for new growth in existing stores. So they have introduced this new coffee. As a long time, addicted Starbucks coffee drinker, I don't like the new coffee. It is too weak. I have always liked the strong coffee Starbucks serves.

So it has me asking questions, doubting my beloved Starbucks. Is this part of an effort to attract new customers who don't like their coffee so bold? Would Dunkin Donuts drinkers really start going to Starbucks because of this coffee? At my Starbucks today, they only had Pike Place. The guy in front of me stormed out because they didn't have another option. He wanted the same coffee I wanted. The old, strong Starbucks coffee.

They are at risk of losing long time customers while not being assured that Dunkin Donuts customers will now become Starbucks drinkers. Starbucks has done lots of research that shows the taste of the coffee is only one reason why people go to Starbucks. For non-customers, it's not about the coffee. It's about personality and brand. They will need to change more than the coffee to attract non-customers. But they could lose loyal customers if they mistreat us while trying to attract non-customers.

Don't ignore the base when they have other options.

Let Your Loyal Customers Be Your Advocates
I actually want Starbucks to be successful. I want to understand what they are trying to do with the Pike Place strategy. But they haven't communicated much to their customers. They have positioned the new coffee as a return to their roots. But my question is why? What about their roots or their first coffee is important? Don't forget that your most loyal customers can be your biggest advocates when adjusting strategy. But they need to understand what you are trying to accomplish.

ROI on the Operational Impact of New Products
The new coffee is causing operational issues. The Pike Place coffee isn't available in prepackaged bags like all their other blends. The new blend requires the baristas to individually pack each bag. My limited observation is that during peak times this is slowing down their throughput. In the morning, every additional person in line creates the risk that you will lose sales. Why not just prepackage it? It is quaint to hand pack each bag, but strikes me as McDonalds trying to build your burger to order. It's not their model.

And the kicker is, I think Pike Place is their cheapest coffee. If you are going to treat a product as special, then make sure it is priced that way so you get a positive ROI on it.