Starbucks can't compete on cost so if it is offering the same experience as McDonalds, Dunkin etc. it will lose. It has to win on the "little luxury" level that helped it grow in the beginning. It's interesting that Niccol is bringing this energy while Chipotle, his former home, is losing ground to fast casual places.
I’ve seen over the last couple of decades that Starbucks has been on a kamikaze mission of sorts: prices have zoomed up relentlessly to the point of absurdity. It’s as though we’re being charged for a meal when we’re really buying a nice snack. $5 or $8 for a cuppa is feeling like a serious ripoff and, seriously, the number of locations is getting nutty. I thing it makes sense to thin out the number of venues, improve the musical ambience, and increase the physical comfort for the customers.
It is funny you mention "getting nutty." My latte is still $8 with almond milk, and that is still the average price with the new policy of no upcharge!
Interesting: "Starbucks wants to shift customers from an $8 mobile pick-up order to the kind of customer who treats the café as a hangout or study space. Not only do these customers spend more during each visit, but the experience also builds stronger brand loyalty, creating a deeper, long-term connection that raises their Customer Lifetime Value (CLV)."
I've been seeing this alot. The sort of divergent economy that companies are trying to cater to high income earners and are sort of giving up growing their base. The clv seems to be at the heart of that. It sort of explains why gdp is up but the labor market is weakened. I think we are witnessing a new type of market. But only time will tell.
That fact troubles me and almost makes yanis varufakis technofeudalism seem plausible. Your work is so right the US is turning it's back on capitalism .
Starbucks can't compete on cost so if it is offering the same experience as McDonalds, Dunkin etc. it will lose. It has to win on the "little luxury" level that helped it grow in the beginning. It's interesting that Niccol is bringing this energy while Chipotle, his former home, is losing ground to fast casual places.
Yes, it is sad to see what is happening at Chipotle, too!
Nice insight
I’ve seen over the last couple of decades that Starbucks has been on a kamikaze mission of sorts: prices have zoomed up relentlessly to the point of absurdity. It’s as though we’re being charged for a meal when we’re really buying a nice snack. $5 or $8 for a cuppa is feeling like a serious ripoff and, seriously, the number of locations is getting nutty. I thing it makes sense to thin out the number of venues, improve the musical ambience, and increase the physical comfort for the customers.
It is funny you mention "getting nutty." My latte is still $8 with almond milk, and that is still the average price with the new policy of no upcharge!
Interesting: "Starbucks wants to shift customers from an $8 mobile pick-up order to the kind of customer who treats the café as a hangout or study space. Not only do these customers spend more during each visit, but the experience also builds stronger brand loyalty, creating a deeper, long-term connection that raises their Customer Lifetime Value (CLV)."
Kroger also used this strategy with the grab and go but grab and stay. I wonder if that is also why some locations have the Starbucks?!
I've been seeing this alot. The sort of divergent economy that companies are trying to cater to high income earners and are sort of giving up growing their base. The clv seems to be at the heart of that. It sort of explains why gdp is up but the labor market is weakened. I think we are witnessing a new type of market. But only time will tell.
Good point. Also most of spending is now done by the top 10%. Companies should be thinking about how to reach more customers and retain them.
That fact troubles me and almost makes yanis varufakis technofeudalism seem plausible. Your work is so right the US is turning it's back on capitalism .
sure of that?