In a earlier posting this week, I made the point about the need for services to adopt a “customer experience” rather than an efficiency approach to growth. Apropos that comment, a story in today’s New York Times on Starbucks — what some think as ultimate “customer experience” retailer — caught my eye. The story, Overhaul, Make It a Venti contained this statement from another coffee shop owner:
After going head-to-head with Starbucks for almost 10 years, Mr. Cates, the Broadway Cafe owner, said he no longer worried much about competition from the company. Starbucks, he said, has lost its focus on coffee, noting that the company switched from making espresso by hand to robotic machines that pump out drinks with the push of a button.
“For them, the move to fully automated machines was inevitable, but they lost something,” Mr. Cates said. “If you are a barista, you have to roast your own coffee. It’s a necessity. You cannot compete by selling music or WiFi.”
Much of the rest of the story echoed that theme of Starbucks’ “lost soul”, including the efforts of the once-again CEO Howard Schultz to turn things around:
Mr. Schultz has said he wants to refocus on the “customer experience,” recapturing some of the magic of the chain’s early years, when employees — who had heard the term barista before Starbucks came along? — made the drinks by hand and customers were excited by top-notch coffee.
Earlier in the Starbucks’ growth period, I remember being told by company officials that they didn’t mind if there was a Starbucks on every corner because everyone would be different with their own micro-environment. Sounds like they went down the centralized McDonalds approach instead. Whether they can reverse that is unclear. As their competitor from Broadway Café noted, moving to automated espresso machines was “inevitable” as the industrial age growth through economies of scale mentality (which Steve Pearlstein pointed out so well – see the earlier posting) kicks in.