For those of us, like me, who can’t start the day without a strong cup of coffee, Starbucks remains an interesting company that is always trying to find ways to be one of the most powerful consumer brands around.
At Wednesday’s shareholder meeting, the company announced several initiatives that hold promise. And a few others that are an overreach.
On the positive, Starbucks will begin testing delivery in Seattle and New York City, which I’ve always thought was an idea whose time has come. The name of the game for consumers in this technological age is simplicity. The easier you can make it for consumers to buy your product, the better off you are.
That may seem like an obvious statement. But look around you and you’ll see how companies think so inside out that their processes become more complex than they should be. (Think banks.)
The Starbucks Brand
The Starbucks brand is looking to simplicity in a few endeavors. The delivery system would only work in dense urban areas, but I can imagine it being a boon to the brand and shut out competitors. Starbucks is also instituting a mobile ordering and payment app, which it should have done long ago.
I guess you could also say that its plan to expand with more locations, adding more than 3,500 units in the next five years in the US, is also about simplicity, but I worry about that one. Starbucks is entering McDonald’s territory where there’s one on every corner and you begin to lose emotional preference. You become only about location. (Think pharmacies.)
But the one that really concerns me is its plan to add more food. Starbucks will add more lunch options and afternoon snacks, but the brand doesn’t have permission to grow later in the day with food. Its brand owns coffee, with a large, emotional footprint in breakfast. Increasing your presence into other dayparts is always a risky proposition for brands that have been linked with a certain daypart. (Think Taco Bell and its weak attempt to enter the breakfast market.)
The overall concern would be that Starbucks believes it can dominate more than it can. You don’t want to hold a brand back, but as Clint Eastwood said in the Dirty Harry movie Magnum Force, “A man’s gotta know his limitations.”