Saturday, July 18, 2009

Giant Coffee Purveyor Signaling a Broader Localvore Movement?

Spending much of the past 2 weeks inside the cool clean relatively quiet confines of the giant coffee purveyor has admittedly been a guilty pleasure.  For one who evangelizes the need to shop local, I guess I could make the argument that the global conglomerate is technically a local company, but I think we would all agree that that would be pushing the envelope a bit.  Nonetheless, with my loaded up (red) card - a percentage of all purchases finding its way to humanitarian aid in Africa - and my free and easy wi-fi, I can drop Dylan off each morning, head to my favored locale just blocks away, and tippy-type the morning away with need of neither cash nor office.  Very seductive indeed.

Not all is so sublime, apparently, in the rest of Giant Coffee Purveyorland.  And it is with curiosity and hope that I read the story below.  Has the sheen of upscale national branding begun to dull?  Has all that consistency and predictability started an inevitable slide toward the simply mundane?  

When did any of us think that the giant coffee purveyor would shed its brand and image to don the, admittedly misleading, cloak of Your Local Coffeehouse?  Hiding behind folksy facades are experiments in branding here, where the Giant first started as just such an establishment so many years ago.  Here, in 3 neighborhoods, the giant is ripping out its iconic green and white mermaid in favor of homey browns and comfy names.  

One of history's most wildly successful corporations, opting to pose local to increase market share.  Interesting.  Dangerous?  Or a signal that the money wants to stay close to home?

One to watch.

From AP:

Starbucks wipes name from Seattle location

Starbucks to open 3 non-Starbucks Seattle stores, may bring pilot program to other cities

  • On Thursday July 16, 2009, 4:40 pm EDT

NEW YORK (AP) -- Starbucks Corp. said Thursday it is wiping its name from one of its Seattle-area stores and adding alcohol to the menu.

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Chart for Starbucks Corporation

The Seattle-based gourmet coffee chain said it is changing the name of one of its existing stores in its hometown to a name that reflects the neighborhood location. The store will be called 15th Avenue Coffee and Tea. It will open next week and will serve coffee and tea as well as wine and beer.

The company said it will then open two more Seattle-area stores without the Starbucks name in locations that aren't currently Starbucks stores.

The chain said if the rethought coffee shop is a success it will consider replicating it in other cities.

"It's interesting," said Morningstar analyst R.J. Hottovy, "especially since the Starbucks brand has been such an integral part of their success."

Hottovy said he thinks the Starbucks brand still "resonates" with those who drink coffee regularly. But, he added, with the recession now in its second year, the brand may be struggling more because it is considered "premium," and therefore expensive, by consumers.

The company has been unable in recent months to keep its sales growing as more consumers cut out small luxuries to save money. Starbucks is slated to report its fiscal third quarter financial results on Tuesday and analysts have largely predicted another same-store sales decline, particularly, in particular, that competition with lower-priced rivals like McDonald's Corp. has heated up.

McDonald's has been rolling out its own line of espresso-based drinks to all of its 14,000 U.S. locations and has been heavily promoting the beverages.

Andrew Hetzel, the founder of coffee consulting group Cafemakers, said Starbucks may also be renaming its stores to provide a testing ground for changes and, possibly, to bring in a new brand of consumer.

"It looks to me that they are testing a specialty sub-brand to see if they can capture some other segment of the market that would otherwise be disillusioned by a large corporate chain," Hetzel said, adding that opening only one at first "gives them a live shop to test changes in menu offerings, store design and, perhaps, procedures quickly" without disrupting operating stores branded with the Starbucks name.

1 comment:

Shea's Mom said...

Hm. That is interesting. Good find.