But Starbucks Doesn’t Sell Coffee
This article landed in my inbox a couple weeks ago and it’s been bothering me ever since.
It wasn’t because I agree with Justin Bariso’s sentiment — on the contrary, I think Starbucks needed to publicly be seen to take action indirectly addressing the incident involving the arrest of two young men in a Philadelphia branch not long ago — but rather the way in which Starbucks, and how people currently consume, seems to be misunderstood.
Starbucks has never just sold coffee. Starbucks has always sold an experience, with coffee adjacent.
Let’s delve into some coffee shop history here.
In the 1970s, Howard Schultz was inspired to create what would become Starbucks after a buying trip to Milan, where he saw that coffee shops were not only everywhere and served top notch java, but they functioned as meeting points and hubs for the local community.
There was (and still is) no such thing as a quick coffee in real Italy: if you’re going for a coffee, put aside at least a good half hour. This is still a huge difference I see between myself and my colleagues: getting a coffee to me is pressing the button on the Nespresso machine and heading back to my desk. To them, you pull up a chair and prepare to shoot the breeze for a while.
In the shops Schultz wanted to emulate, you didn’t just come for coffee, you came for the place, the community, the experience. It was more essential to the brand than the tangible product even.
Schultz’s first stores tried to capture and sell that experience: on top of offering espresso-based coffees, opera music would play in the background, gelato was served, little seating encouraged consumers to stand at the bar and socialize.
47 years have flown by, and the world and consumer demands have changed, but the saleable experience as a priority is still there.
Starbucks still doesn’t just sell coffee. It sells the promise of comfy seating and consistent wifi (note that even accessing the wifi is branded, showing how key service and experience is to the Starbucks sale).
It sells a fun way to mark holidays and the festive season.
It sells an Instagram photo, story, Facebook post, after school hangout, easy meeting point, familiarity. Outside of the US ironically, it now sells a bit of the American experience.
Simple litmus test: raise your hand if you have ever bought the smallest filter coffee just to use the wifi for an hour or so in an airport, when your flatmates were a little too rowdy for you to write your final thesis, or when you’d just moved to a new city and needed the feeling of a familiar place.
The interesting misunderstanding in this article is the belief that Starbucks will somehow now lose out by explicitly offering experience in their “Third Place Policy”, when in reality so few Starbucks diehards have ever been much more than what Bariso deems ‘loiterers’, aka those who have been sold more on the experience than the product.
We are already seeing a trend worldwide of associations where the business model is shifting to consciously prioritise this sale of experience over the sale of a consumable good when both are up for grabs.
Examples of these are work cafes such as Hubsy and Anti-Cafe in Paris, where you are charged based on the time spent there (capped at €20 a day in the former) and can consume as much coffee, juice, snacks and all on offer in that time.
The sensational rise of The Wing in the States is another: members fork up a staggering two grand for the yearly membership with the main selling factors being time, community and being a part of something. And boy, do those memberships sell like hotcakes.
To paraphrase the great Leo Burnett, don’t tell me how good something is, tell me how good it makes me. No one has ever gone to Starbucks just for coffee and, if you do, question whether what you mean is in actuality just its familiarity, the promise of a certain experience, the fulfilment of a certain expectation.
It’s never about the thing. It’s about what’s around the thing, and around this certain thing, there always happened to be toilets.
