The Next Starbucks

It has been a hard to watch some of the news items trickling out about Starbucks lately.  From cheaper coffee to smoothies (how very late nineties)- the brand's recent moves have me underwhelmed and quite puzzled.  A brand that has led the rest of the market for so long is now, at least appearing to scramble to do what everyone else is doing and has been doing. In early 2007 Howard Schultz warned of the  commoditization of the Starbuck's experience. Starbucks reshaped consumer behavior in the US (and Asia).  It turned coffee into a new social concept.  The Starbucks ritual reshaped how people get together, meet up and spend time in between the activities of the day. It was more than coffee - it was a reinvention of the American eating out experience,  which had stayed unchanged since the birth of McDonald's. Ironically we now see the brand feeling more like McD's than anything new - and in fact with some of what the fast food brands are doing with partnerships like Nestle and Vitamin Water - they come out looking like the innovator.  Easier to do when you are "trading up" the brand.

An article in the WSJ delivers some advice from Starbucks Asia on how to recharge the passion around the brand.  " To break into the market, Starbucks strategists observed customers at its first outlet on a back street in Tokyo's Ginza district and soon caught on that women with disposable incomes would become the main patrons of Western-style coffee houses. Subsequent Starbucks outlets in Japan catered to them with a smoke-free environment conducive to lengthy conversations."

It seems to me that the brand that has been leading in this passionate twist on lingering and grazing is the Belgian brand Le Pain Quotidien.  We mentioned this point in an article about Starbucks when it was announced that Howard Schultz was returning.   There is a lot to be learned from this brand for  Starbucks.  Perhaps  at least in developing a tiered brand strategy where different locations function in unique ways.  Some faster - some that encourage lingering.  In the meantime I think Le Pain Quotidien will be filling the space that Starbucks seems to eager to leave behind.