Starbucks Corp. built its broad appeal on what Chairman Howard Schultz labeled an “experience,” including baristas who know customers’ orders by heart and an atmosphere that entices patrons to linger for hours. That experience has enabled the coffee chain to charge the premium prices that fuel its robust earnings growth.
But now Mr. Schultz is questioning whether Starbucks’ drive for growth and efficiency has diluted that experience. In a blunt Feb. 14 memo, he warned executives that the chain may be commoditizing its brand and making itself more vulnerable to competition from other coffee shops and fast-food chains. The nearly 800-word memo questioned whether Starbucks’ automatic espresso machines, new store designs and elimination of some in-store coffee grinding may have compromised the “romance and theatre” of a visit. Read More at The Wall St. Journal Online. This is along and very enlightning bit of news.
Posted by beanybabe at 1:36 AM PST
