This post is part of a feature on companies and products that our bloggers think are in need of a makeover. See all 26.
OK: Starbucks Corp (NASDAQ: SBUX) is already in the middle of a serious makeover, with instant oatmeal as its unlikely star. CEO Howard Schultz is back with a vengeance, slashing cannibalistic stores, reducing middle management, training employees on how to make lattes (such an idea!), coming up with new mellower coffee blends to combat the constant complaint of burnt-tasting coffee, and unveiling a breakfast menu meant to save Schultz from his own unhealthy habits.
What more could I ask for? Plenty. To begin with, Starbucks has a serious green image problem that was recently exacerbated by the revelation that store policy mandates a faucet in the "dipping well" be kept running constantly. To combat this, Starbucks could institute recycling programs in each of its stores; more aggressively market the "bring your own cup" programs; become more of a leader in demanding sustainably-harvested ingredients in its products (not just coffee beans but hormone-free milk from grass-fed cows -- I know, pie in the sky -- and organic oats for its famous oatmeal); further lead the charge toward healthy food by reducing the sugar contents of its standard beverages and treats.
The other problem with Starbucks is its prices. The company has set the worldwide bar for coffee beverage pricing, without simultaneously setting the worldwide bar for coffee quality. Its coffee is OK, but not nearly so good as much smaller, independent coffee roasters whose beverages are the same price. Price and quality should be commensurate and it's no secret that your consumers are going to start running out of money when the credit crunch hits Visa and Mastercard. Woo them with a 50-cent across-the-board price cut, make the $1.00 coffee a regular menu item, and you'll keep their loyalty.
There are more problems. Starbucks: your baristas are not known for their personalities. In fact, I get more comments on my posts complaining about rude, dispassionate, or just plain lazy employees at your coffee shops than any other food service establishment. This seems perplexing; servers at many other quick service restaurants are paid just as little, and arguably have far less comfy working conditions. Do a better job hiring and training your employees; take a hard look at store management to see if you've let bad apples spoil the bunch.
And finally (and most importantly), this: bring back the coffee shop. Remember when Starbucks was a "third place" where people could go to hang out in a comfy chair and chat with friends? People still meet at Starbucks for all kinds of reasons, but it's just not comfy. The arm chairs have been replaced by smooth, unfriendly art pieces meant to keep customers cycling through. The regular chairs are flimsy and discourage lingering. The layout of your stores is efficient and unwelcoming. What made you great was your atmosphere. Stop treating your retail outlets like retail outlets, packed to the gills with merchandise of every sort, and start treating them like living rooms again. That's what would get me coming back.
Does Starbucks need a makeover? What would you suggest? Be sure to check out the other makeover posts.
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Reader Comments (Page 1 of 13)
10-23-2008 @ 6:42AM
tom said...
totally agree with this post. Have been to starbucks maybe once in the last 3 years. The thing that really gets me is the price, i live in the UK and i think if my memory serves me right you are talking upto about £3 ($5.5 approx) for a large coffee. Just seems a ridiclous sum to me, thats why they lost my business. Also. personally i don't mind buying my fast food from some huge chain, but when it comes to sitting down for a cosy tea or coffee i like something i little bit more personal. Oh and i once tried one of their cakes, and maybe it was a one of dud batch, but it was tasteless and also insainely expersive. No this is one company that would have to do something amazing to get me going through their doors again.
10-23-2008 @ 9:35AM
Belinda Richardson said...
I agree that the prices are a turn-off and the coffee does taste burnt and is too strong. I get the decaf on the rare occasion that I buy coffee there, which is usually when they are the only coffee shop in the area. However, it is still so strong that it is impossible to finish the cup. I think a cup of MacDonalds coffee is better. I never understood all the hype about Starbucks. I become a customer once a year and that is when they offer Pumpkin Spice Lattes. I like their marble coffee cake but most of them got rid of their microwaves so I can't get it warmed which keeps me from buying it now.
10-23-2008 @ 7:47PM
Steve said...
Quality is consistancy ! I can go to 3 different Starbucks, order the same thing, and get 3 different tasting products. At least their bottled Frappacino is dependable. And the Price............
10-23-2008 @ 8:43AM
Steve said...
I live close to Starbucks, Paneras and McDonalds. Starbucks has essentially lost perspective as to people being willing in these times to pay $3.50 for what is essentially a $.25 cup of coffee. Over the last 25 years I have consumed approximaterly 800 lbs of home-brewed Folgers and could in no way cost-justify going to a Starbucks when McDonald's sells a similar basic cup of coffee for subatantially less. I could brew the same coffee at home for a fraction of what I would pay for similar coffee at home. For me it is clearly a value-issue.
10-23-2008 @ 8:52AM
G said...
Probably coming from because I come from a family of ranchers and sailors, I do like strong coffee. Starbucks and Peets (a local chain) are just fine for me. The pastries and breakfast sandwiches seem a bit expensive, but a "Venti" coffee, that's over a pint (half litre) of the brew, is still under $2.00 and lasts me all morning.
10-23-2008 @ 9:08AM
Larry Imboden said...
For years I went to Starbucks every day for a grande coffee. I love strong coffee, and Starbucks was able to give me what I wanted. Unfortunately, the coffee is overpriced, which is one reason why I switched to Dunkin Donuts for my morning coffee. It also tastes better than Starbucks and it doesn't upset my stomach or make my hands shake.
The atmosphere in my local Starbucks has changed. They have more and more merchandise for sale, and there aren't too many places to sit down and chat. If Starbucks wants to regain my business they will have to improve the flavor of the coffee, significantly reduce the price, and start a coffee club. I think regular customers should get a free cup of coffee on every 10th visit.
10-23-2008 @ 10:00AM
Ang said...
Starbucks does its specialty coffee drinks well....I love the holiday flavors like Pumpkin Spice latte and the Peppermint Mocha at Christmas. Everybody likes to hate on Starbucks, but their concept is what started places like McDonald's and others brewing "specialty" coffee. Also, I'm not sure where everyone else lives...in my areas, Starbucks stores still have comfy chairs, ambient rooms and music. I'm not a Starbucks devotee...I enjoy Dunkin' Donuts' blueberry coffee latte every so often as well. I just like good coffee anywhere I can get it. I still like Starbucks. Their concept brought haute coffee into the mainstream.
10-23-2008 @ 10:19AM
sheldon palmer said...
starbucks need coffee that tastes like dunkin donuts instead of something that is so overdone that it tastes like it came from an automobile engine crankcase. one of the most overrated products of the century.
10-27-2008 @ 11:05AM
strista said...
I have worked for starbucks for a while now and coming from me (a person who actually knows what they are talking about), you are wrong. Starbucks is having a big change over and getting more healthy food options, but we do it for our customers... not Howard Schultz own benefit. I dont understand how you can find the negative in everything, pessimists ruin starbucks, not the baristas. You have to be stupid to think starbucks purposely hires incompitent people with bad attitudes. Stores such as mine recieve about 10 applications a day, we have no shortage of options and we ONLY choose the best and we strive to be the best while on the floor too. As for the coffee strength, if you don't like it then you clearly do not know how coffee should taste. If you want weak watered down coffee go to dunkin donuts and go see what a dollar can buy you. So as far as prices, you pay for the quality, service and atmosphere. Starbucks only offers quality drinks. We recieved new espresso machines to improve the quality... so we are doing all we can. For all those who don't know, starbucks is offering a gold card with benefits such as free coffee refills, free syrup add-ins, free beverages on your birthday and 10% off every visit! When someone can be so negative about something it really gets to me, you should hear the other side before you make all of these accusations. We are improving out company as a whole, dont pick us apart in the process.
10-23-2008 @ 11:09AM
Charlie PA Tpk said...
... while everyone is certainly entitled to their opinion, yours and mine included...
What is the purpose of this series of 'makeover' posts? If you don't like the way Starbucks runs its business, go elsewhere. I refuse to pay $3 for coffee, ever, so it matters not to me. But if you think your suggestions for going green won't equate to higher prices for the consumer, think again.
The business is in business and is successful for a reason: they know what they're doing. Feel free to post away to your heart's content, but don't think they're waiting on your latest suggestion: they don't need these petty ideas.
10-23-2008 @ 11:43AM
Mike said...
I agree totally with the article. Starbucks ran me off years ago with rude or dispassionate employees and burned product. I really don't know how a corporation could get so large with such poor business sense. Well, I guess I do. MBA's with zero real world experience and somewhere the people (bean counters) that care more about their spread sheet and what a PAID pundit says than what the real world says.
10-23-2008 @ 11:54AM
Vintage80s said...
I never saw what the big deal was with this place?! On the rare occasion that I've ever ventured into one (friends made me stop there) , I've tried to re-try the regular coffee. It's always too strong and bitter for my tastes. I grew up on A&P (5-o'clock, 8-o'clock, whatever it was called) fresh ground beans at the store, percolated at home, and like flavor vs. tons of sugar drowning out the awful taste. I take Dunkin' Donuts coffee and donuts/bagels over Starbucks crap anyday!
10-23-2008 @ 12:01PM
Love said...
Do any of the negative commenting people actually go to starbucks? It is like you don't even know what you are talking about. Do some research then tell on how the prices of coffee are (there are many coffees to chose from not just the strong), how they are environmentally friendly, and the baristas can have off days. Everyone does.
10-23-2008 @ 12:02PM
Johnny Durham said...
I hear rumors that Starbucks will not support our troops. If that is so I will not support Starbucks under any circumstance.
I would like to know if that is true.
10-23-2008 @ 12:08PM
jc said...
Starbuck is a fashion statementoverly priced for fools.
10-23-2008 @ 1:20PM
picbyron said...
I travel the US and can say that Starbucks is easily the best and most consistent coffee I find. Prior to Starbucks the various places had much more often burned coffee. I also happen to know that leaving the water running is more a health rule because I am in that line of business. You get much more for your money at Starbucks too. The ir seems to always be free samples of any food you want to try.
10-23-2008 @ 12:12PM
Elisa Schroeder said...
Is it just me, or do the pastries and breads taste like cardboard since they took out all of the "good" real butter fat?
I used to look forward to a slice of marble cake or coffe cake, but not anymore. I'm disappointed every time I try a different pastry. My occasional indulgence is no longer "worth the calories".
10-23-2008 @ 12:12PM
Matt said...
I agree with a lot of what you said, but not all of it. I worked for Starbucks for several years and I'll be the first one to tell you that its not a "comfy" working environment. The shifts are long, the upper management is awful, and to be honest... a lot of the customers are awful. Picture yourself as the last thing standing between that customer and their coffee... Even the baristas working the registers have way more work to do then you would imagine. Not only do they have to take every customers order, but they have to simultaneously keep the pastry case full, keep the coffee going, help whoever is on bar, and get the store ready for a turnover to the next shift. You may say "well thats work" and i agree, but don't under estimate the difficulty of a job like this. People say "Oh I hate Starbucks Coffee..." when in reality most of them don't know the difference. Its really easy to hate something that everyone else hates especially when its a corporation. There is no 3.50 cup of brewed coffee at Starbucks... the most expensive is $2.08 if I remember right. Thats still a good amount of money, but for 20 oz of well prepared coffee its up to you to determine whats worth it. If you don't like Starbucks, don't go there... plain and simple.
10-23-2008 @ 12:11PM
Janet said...
I had stopped going to Starbucks, but started back again when I heard that the reason their prices had gone up was so that they could provide insurance and other benefits for their employees. I like to support companies that work are aware of the greater good. The reason they leave the faucet dripping is because it's required by law, which the article neglected to mention. They have improved their baked goods, which used to be tasteless. I have had only two rude baristas out of the many who have served me; I didn't say anything about the one guy, but the store made me a new drink, gave me my money back, and talked to the guy who made it. I'm not sure why it's necessary to tear down these companies when she should support our American merchandisers that are by and large doing a good job, especially in times like these. I do REALLY miss the comfy chairs and hang-out atmosphere, though.
10-23-2008 @ 12:12PM
Stefan Wuernitzer said...
What is really unacceptable in this day and age is that Starbucks does not offer recycling bins. There is one trash can and everything goes in there, regardless. And there is a lot of glass, plastic and paper tossed away with each order.
And yes, the price policy is rediculous. And in Western Europe this past summer a double tall cappuccino cost Euro 4.10 which then amounted to $ 6 for this beverage. Simply insane.