Thursday, July 10, 2008

Starbucks closes their brand.

It is no surprise that Starbucks has had to make some drastic changes in light of its sinking stock prices. The once beloved neighborhood mecca of coffee culture had become obsessed with being the next Viacom and Walmart of “cool.” Through constant promotion, media distribution and even films, we saw Starbucks lose its way and vision as a company - diversifying to the point that coffee became a commodity again and profits began to plummet. The number of stores and the dismissal of coffee basics led this company astray and we all applauded to see Howard Schultz step back into leadership to rally the lost brand back to its glory days. Yet, no one could be more surprised to learn that as part of the cost-cutting efforts, Howard Schultz has decided to close the very brand that transformed our approach to American marketing. As part of their cost-saving efforts, Starbucks released their intent to close 600 stores. The brand loyalists felt this to be a wise decision as the addition of drive-through and cookie-cutter stores contributed to the decay of the brand experience. We anticipated the closure of new stores and strip mall additions, yet were shocked to hear that our neighborhood hangouts were being closed in main streets all across America. The Rochester, Mich. downtown store represented the quintessential neighborhood hangout. This store corners a picturesque main street and has constant foot traffic, and features baristas who know your name and signature drink. One visit confirms that this store fully embodies the brand experience that Howard always dreamed of (and even wrote a few books about). Yet, this perfect brand example is on the chopping block. “Why” you might ask?

In his book, Schultz wrote that he feared the day Starbucks would become “just another soulless big chain.” Yet with his choice to close stores reliant on foot traffic in favor of gas guzzling drive-throughs, Schultz has chosen to lower his brand value to that of the fast food market. The introduction of the Pike Place campaign offered a glimmer of hope. But unless Schultz steps in to save the gems that helped build a brand that inspired loyalty and relationships, all we will end up with is another McDonalds on every corner with green straws.

This article was commissioned by the Collective Starbucks Loyalists of Rochester to save Rochester, Mich.'s downtown Starbucks on University and Main Street.