Tag Archives: 15th Ave. Coffee & Tea

Buzz: Why the Starbucks “15th Ave” Store Is Doomed to Fail

Source: Peter Merholz of Adaptive Path, Harvard Business School
Date: 2009.07.28

Editor’s note: Peter continues the conversation he started here in his next post, Further Thoughts on Starbucks’ 15 Avenue Experiment)

Late last week, Starbucks opened a new coffeehouse. Considering they have around 15,000 outlets, this might not seem like news. But there’s a wrinkle: the new coffeehouse is called 15th Ave. Coffee & Tea, and is an attempt by SBUX to create a distinct, bespoke, of-the-neighborhood coffeehouse.

Two and a half years ago, Howard Schultz famously distressed over the “commoditization of the Starbucks experience,” and after returning as CEO, committed to transforming it.

But 15th Ave Coffee & Tea is an experiment doomed to failure, because there’s no way a corporate coffee chain can create an authentic neighborhood coffeehouse experience. Your favorite local coffeehouse is the product of someone’s passion, dedication, and probable borderline craziness. 15th Ave is the product of corporate product design and development. Read the introductory copy on the 15th Ave website:

Fresh roasted coffee. Tea picked from the far reaches of the world with care. Artisan baked breads and treats that are sure to delight. A little flair of Italia with some heavenly gelato or affogato. 15th Avenue Coffee and Tea brings these flavors of the world direct to your local neighborhood everyday.

This is so transparently corporate marketing speak. Compare it to the website of my favorite San Francisco coffeehouse,Farley’s, which is amateurish (and I mean that by its Latin root: done for the love) and personal:

Roger Farley Hillyard broke his coffee pot back in 1988 and could not find a store to purchase a replacement part. After scouring the city, Farley’s was conceptualized as a coffee and tea store. Through various incarnations, the present day concept of creating a place of community for the community was developed….The character of Farley’s mirrors the uniqueness of the people and allows for a genuine and distinctive experience for everyone.

Faking it is not a good strategy in bed or in retail.

Perhaps my biggest beef with 15th Ave is that it’s fundamentally dishonest. Everyone knows it’s run by Starbucks, but the website and the store do all they can to suggest it’s a true independent (though the high level of interior design suggests a bankroll out of the reach of most entrepreneurs).

So why not just call it “Starbucks”? About a year and a half ago, I posted on Adaptive Path’s blog about how Starbucks could improve its experience, and many of those ideas are being attempted with 15th Ave. Do the folks in corporate feel that the Starbucks brand is so brittle that it couldn’t encompass this experience?

It’s pretty clear that there’s a high degree of consternation about the associations people have with the Starbucks Experience. I find it foolish that they’re trying to re-engage the more sophisticated end of the coffeehouse market through this new, out-of-whole-cloth creation. What Starbucks needs is a series of “experience interventions” within their existing store framework.

Instead of expending efforts creating whole new experiences, prototype and iterate improvements on the existing experience. Keep fiddling until you’ve found something that hits your sweet spot, that lucrative space above Dunkin Donuts and McDonald’s, and below the quirky and sophisticated local roaster.

When I first heard about 15th Ave, I wanted to like it. I find plenty to admire about Starbucks — when I lived in Manhattan in the mid-90s, they did more to improve the quality of that city’s erstwhile swill than any other single factor. And I think it’s great when companies pilot new concepts, particularly those that are driven by improving experiences. But the clumsy cloak-and-dagger of how this “independent” store’s status was handled leaves such a foul taste that I can only assume it will go the way of Circadia, Starbucks’ failed, late-90s attempt at a similarly funky neighborhood coffeehouse that sold booze.

Howard, stop fiddling with these distractions. Focus on improving the core.

(For those further interested in retail experience design, Adaptive Path recently published a detailed case study of work we did with Mission Bicycles, a boutique fixed-gear bicycle retailer in San Francisco.)

Buzz: Nicholas Cho on Starbucks New Strategy

July 26, 2009: Washington Post

Your Local Coffee Shop,
Courtesy of Starbucks?

Coffee used to be about consumption. It wasn’t supposed to taste very good and was often freeze-dried. I remember my introduction to the beverage that would become my livelihood: My parents laughed as I gagged on the bitter swill. This was the first wave of coffee.

Recently, coffee became more about enjoyment. Make me a cappuccino! I want it blended up with some ice! I love it with an extra pump of vanilla! No longer do we put up with bad-tasting coffee. In fact, coffee doesn’t even have to taste like coffee at all. This is America! I’m entitled to something yummy! That was the second wave.

Now we’re seeing the development of a third wave — a shift that my colleagues in the specialty-coffee industry have helped nurture. Much like wine appreciation or music appreciation, third-wave coffee isn’t just about pleasure. Coffee enthusiasts are taking the time to understand what goes into a truly great cup, researching everything from where beans are grown to proper brewing. This is the wave that I rode at Murky Coffee, which I ran for seven years, and that I’ll follow at the new place I’m helping open this week in Washington, Chinatown Coffee Company.

But now the waters are getting a little choppy.

The big green mermaid wants some of the third-wave action. On Friday, Starbucks opened a store in Seattle that’s not what you’re used to seeing on, say, every other block of most U.S. cities. It’s called “15th Ave. Coffee & Tea, Inspired by Starbucks,” and it’s apparently part of the company’s effort to refresh the brand. The plan is to offer the independent coffee-bar experience: better coffee, more knowledgeable baristas and a more refined cafe environment.

In other words, they’re encroaching on my turf.

In what has become legend in Seattle, about 10 dark-suited executive types clutching logo-emblazoned notebooks went on a series of research trips to some successful independent coffee bars in the city, including Victrola Coffee Roasters. The barista trainer there, a friend of mine, told me that one of the baristas grilled the visitors until they confessed their mission: to take notes on the cafe’s vibe. Another barista supposedly got sick of seeing his every move discussed and notated. He leapt toward the corporate spies, jumping up and down while exclaiming, “Dance, monkey! Dance!”

I wonder if they wrote that down.

I actually wish them the best. Maybe Starbucks will return to being about coffee instead of about milkshakes, breakfast sandwiches and Sheryl Crow CDs.

This might seem strange coming from me; I am an independent coffee retailer, after all. Last year I received a bit of attention when my Capitol Hill shop was closed because of tax problems, and later when a customer at my Arlington cafe flew off the handle because he didn’t like our policy of not serving espresso over ice. Bloggers began debating whether the customer truly is always right, the sort of policy that’s more common at corporate chains.

So some people might assume that I’d poo-poo Starbucks’s efforts. Everyone expects the proverbial little guy to sling stones at the big guy, as if doing anything else would be un-American.

But if Starbucks brings one of these new concepts to Washington, I’ll be among the first in line. To me, Starbucks is only a problem if the quality of their coffee gets worse, and this new spinoff might help it get better. (If they want to compete with the likes of Victrola and other great third-wave coffee bars, it’s going to have to get a lot better.)

I hope the coffee wars help nudge the caliber of all coffee upward. Just because you’re not a corporate behemoth doesn’t mean you serve delicious brew. The dirty little secret of most independent coffee shops is that they don’t know how or don’t care to serve high-quality coffee. They believe that furnishing their shops with comfy chairs and knowing the names of their customers’ dogs is all that matters. What’s arguably worse is that some of the most highly respected chefs in the country are serving some truly awful coffee. Apparently great coffee doesn’t help get you a show on the Food Network.

My customers tell me that, aside from the coffee, what makes a great coffee shop experience is the authenticity, which is one of those you-know-it-when-you-see-it things. How can you manufacture authenticity? That’s the problem that has plagued Starbucks for years, and I don’t know if this latest project will help them figure it out.

Still, I really do wish them the best. After all their research, we’ll see if what should actually be called “Inspired by Dancing Monkeys” is another success for the mermaid.

nick@murkycoffee.com

Nicholas Cho is the former owner of Murky Coffee and the chairman of the United States Barista Championship.