Is Starbucks chucking away its identity?

It’s been tough for the coffee shops in this past year of recession. You don’t need to be Einstein to realise that a £2.50 latte is one of the first things to go when tightening your belt.

However the biggest chain in the world Starbucks has posted better results than expected. In the U.S. home market, Via is cited as taking the credit for this.

What is Via I hear you ask? It’s instant coffee. Yes instant.

Isn’t this just defeating the whole object of Starbuck, making real coffee?




It’s one of those brand stretch ideas that just stretches the wrong way. It clashes with the brand identity. It might have contributed financially in the short term but I would advise concentrating on far better ideas that DO fit into the brand, such as packaged beans and new drinks such as bottled lattes Of course the company needs growth and this can’t just come from store openings but it’s got to be the right sort of growth and takes share of customer purse. If you are a real coffee lover, you’re not going to go for instant.

Another idea Starbuck has got for growth is the opening of a new concept store, the Coffee and Tea store. Thanks to trend hunter for this.

It’s supposed to be more individual, more local, more rustic sort of coffee house, stocking a range of coffee and teas that the mainstream stores can’t offer.

I have got mixed feelings about this. As a speciality coffee shop, Starbucks can’t exist on a large scale. It has to be standardised, not all staff can be passionate baristas and some types of specialty coffee can’t be provided to 15 000 stores. So I can see why an offshoot store might make sense to provide new products, test them out and attract a new customer segment that won’t go the big corporate store.

However I cringe when Starbucks describes the concept.

“Coffee & Tea offers customers new opportunities for discovery, a high level of interaction and a deep connection to the local community.”

Sorry – what?.

“Customers can participate in and enjoy musical performances and poetry readings; they can also bring in their favorite LPs to play on the sound system”

Can any one find an LP? Isn’t this a bit hippy nonsense?

“This coffeehouse design is …. eclectic and raw, featuring locally sourced and reused materials that are one-of-a-kind.”

Eclectic and raw? Pleeease.

“Materials sourced from existing Starbucks locations: floor and ceiling are original; bar top and doors were repurposed from the Seattle University Village store prior to its renovation; chairs were sourced from area Starbucks stores and refinished; and chalkboard frames were made using shipping pallets from the Starbucks Support Center in Seattle”

I actually do like this bit. Grabbing bits of old Starbucks and making them into the new store. One thing though that strikes me after reading all this: is it a Starbucks coffee shop, yes or no?

I think there is some brand confusion here. The stock market is demanding growth and of course Schultz needs to deliver. However the growth strategies need to be well thought out and should look at share of customer purse rather than store openings or new customers.

What things can we sell to the existing customers who are coming inside the door? Think of that massive footfall and how to make the most of that? What other products and services can a coffee shop sell? As well as the bottled take away drinks and beans as mentioned, what about gaming? Newspapers? Books?, Coffee courses?

Anyone heard of BOGOL?

By now most consumers are familiar with BOGOF, buy one get one free. It has been the most regular tool in the sales promotion bag for some years now. But this week, Tesco has announced that it is trialling a new scheme “Buy One Get One Free Later”, or as I have christened it – the BOGOL. So what is that about?

Well it seems to have come from a really good consumer insight, (as most of tesco’s ideas seem to). Some customers are interested in Tesco’s Bogofs but can’t use the produce before the sell by date. This is likely to be most common amongst smaller households.

What a neat little idea! According to Tesco, customers can pick up their free product the same day or the next week.

A – ha! So there is the crux of the clever idea. What better way to ensure that customers come back into your store the following week? Personally I flit between two supermarkets, just to vary the experience and for a touch of variety in the products.

No denying that Tesco have done a superb job in the loyalty arena with their club card but the BOGOL offer is better in some ways since I actually have to go in to the store. And who has ever heard of ANYONE going into the shop for ONE item and coming out with just ONE? Or is it just me that walks in without a basket and ends up juggling seven items like a demented clown?

When you consider the strong growth in a one person households as well as lone parent households, the insight becomes all the more powerful.

Oh and Tesco also claim they are helping us with our food waste reduction. Anybody smell greenwash?

Great idea Tesco but let’s not bother trying to pretend you are helping me reach my green target. It’s a great marketing / customer loyalty idea – be proud of it!

KFC = Kan’t forget the customer?

KFC – I never eat it, haven’t been for over 10 years. But I do know what they are about. It’s clear, it’s in your face, it’s junk food in a bargain bucket. It tastes good and they don’t care. I love it.

I am already tired of all the TV programs, magazine articles and gym membership leaflets coming through the door. Just as silly season has ended, the mad diet season begins. We must be healthy, we must purge our Christmas sins, we must avoid sugar and fat and run around the park.

But one TV ad caught my eye. It followed the new DVD from the latest newly size 8 celeb, and it was for Kentucky Fried Chicken, or as it is now known KFC.

Chicken, fries, bakes beans, creamy coleslaw and wait for it, full fat coke for a special price. Why cook mum when you can give them what they want?

There must be about 5000 calories in one of those meals. OK I exaggerate, but not much. But KFC don’t care, they know that when people want junk food, that is what they want.

I have to admire this brand for sticking to their principles. While MacDonalds was promoting salads, and Pizza Hut was re-branding to a healthier Pasta Hut, KFC never once waivered from their proposition. Chicken junk food, Finger lickin good. And who can forget the Colonel, an integral part of the KFC brand identity since forever. You have got to hand it to them, they never bowed under the pressure, they just give the customers what they want.

However, new owner group Yum! have in my opinion, entirely missed the point by trialling grilled chicken in the US. What’s more they have reportedly spend over ¼ billion dollars pushing it, offering a free piece to every customer.

The franchisees in the US, who are clearly more in touch with their customers than their parent company, disagree so strongly that they are suing their own company. They believe the brand is losing its focus.

You might not agree with junk food advertising and like me, you may believe that UK has a very serious obesity issue but these fast food places are not the issue, we are, as a society. You also have to admit that the marketing team in charge of KFC have had the (chicken) balls to stick to the brand values thus far and I think they should be allowed to continue.

Cast your vote: British Airways or Ryanair as worst airline?

I can’t decide which air company I like less. They are both really trying their best to convince me that they are the worst air company in the world but the decision is really very difficult.

Hidden charges and seats like a slab of concrete or staff that look at you like they want to spit at you and try to ruin your holiday by striking? Mmmm….strong competition.

Airlines have already been in crisis for a few years now. Ever since Ryanair and Easyjet put the cat amongst the pigeons with an entirely new lean business model with low running costs and low fares, the older established companies have struggled. For a while, before the “Great Recession” BA seemed to have found a bit of a niche with business travel charging companies extortionate amounts of money to get horizontal on a plane. But then budget cuts came and profits plunged. BA had never really tackled their enormous cost base they have been carrying since the glory days.

With fresh strikes announced for February, looks like BA’s reputation with customers will plummet to new lows.

I travelled with BA this Christmas, it was efficient, it was on time, it was roomy but the staff are snotty nosed and condescending. They are actually lucky that they didn’t get lynched by us, the poor customers, who nearly missed out on spending Christmas with relatives abroad.

But the fact that the cabin crew would rather see the company go bankrupt than take a change in working conditions, that even their colleagues in Gatwick have accepted (and frankly on the face of it, I can’t see the problem?), begs a fundamental question to me.

The BA staff aren’t living the brand are they?

They clearly don’t feel part of the future of the company or even its present. The cabin crew are the face of the company. They are the front line, the people that we, as customers, deal with. We don’t meet the marketing department, we don’t see the pilot, we see a bit too much of Willie Walsh apologising on TV but we don’t know him, a large part of the way we view the company is based on the check in staff and cabin crew.

Whatever the master plan is, whatever changes are needed in the company, and whatever the final vision is, BA must start communicating it better to their frontline staff before us the customers. If the staff don’t believe then the customers won’t. Striking staff is totally disengaged staff who don’t give a stuff about the consequences.

Here’s a company that needs a huge internal marketing job. We talk a lot about external marketing but internal marketing in an organisation of this size and with significant changes to be made, is essential. If staff don’t understand the change, they won’t support it.

So back to Ryanair. So the seats are rubbish, the staff don’t care, Michael O’Leary doesn’t care, but it’s cheap. I can live with that, it’s refreshingly honest. Where it goes wrong for me, is then ruining that clear approach with hidden charges. Bag charges, credit card charges, mysterious “expenses” lumped in with airport tax and impossibility to check in children online which means an obligatory £8 charge to check in at a desk (each). If your proposition is basic but cheap you actually do need to be cheap. And you need to be honest about the prices. I’m not saying that Ryanair won’t still be a success because they have a monopoly on certain routes and if you want cheaper, you’ll choose them, but I think that the low cost proposition is a clear one and there is just no need to wind up your own customers.

So have you made your decision? I am still debating myself….

Jimmy Choo's or Shoe Zone?

We’ve had the Kate Moss collection at Top Shop , Lily Allen for New Look and recently H&M featured a special Jimmy Choo’s selection.

Seduced by a lower price tag for one of Britain’s best loved designers, I popped into a London store to take a look. (It was limited stores only and lowly Peterborough didn’t make the grade).

Of course I wasn’t expecting to find much left over after the initial rush but there were a few pairs. I was surprised however to see how awful they were. Not the design so much as the quality. They would have fitted in nicely into the Shoe Zone’s bargain basement range. With a £50 price tag these I thought that they could at least have used leather, not plastic.

So what does this say about one of the hottest brands out there?

I understand that high end fashion has to reach down to the masses. It’s a financial reality with rising costs at the supply end and a recession that is hitting even the richer end of the customer spectrum. However, where Top Shop got it right, Jimmy got it wrong. The Kate Moss collection starting at about £120 and going up well over £200 is pricey for Top Shop but you’ve got to give the public something to aspire to. Too affordable and it just isn’t desirable.

Your average Jimmy Choo’s are about £300 a pair, so if H&M had priced their collection at £120 for example and used some decent quality materials, I would have said that would have been a better choice.

Yes I am sure they sold well and some members of the public are chuffed with themselves but what about the core customer? What about the ones that pay £300? Do they really want to see a Tesco checkout girl sporting plastic Jimmys with the same label as them? I think not.

Luxury branding is about aspirations. As the recession continues to bite I wonder if more brands will let the prospect of good sales figures turn their heads and stamp on their core customer?

If anyone has seen the current Sonia Rykiel collection, let me know if it is any better.

Wot no toilet?

On a recent trip to London I was reminded of that annoying concept that only seems to appear in London, cafes with no toilet.

Why is that? Are they afraid that the homeless and drunks of the streets will appear on their doorstop and use their facilities? Are they afraid that customers might dwell there too long with their lip gloss? Are they afraid that you might buy only a measly packet of biscuits just to use the loo? Or do they just not give two hoots about their customers?


How many people can manage a latte without a wee? Come on girls, you know what I am saying! Why on earth do the Costa coffees and Prets of the world think it is ok not to bother giving us the usual facilities.

Not only is it bad customer service and certainly leaves me unimpressed and bursting to go, I would actively avoid cafes without toilets. So your £2.99 for a coffee has just gone somewhere else.

As opposed to it being something cafes grudgingly supply to you it could actually be made into a positive. A good clean loo is actually a selling point. I remember where the good loos are in a town. And an exciting and different loo can make you actually specifically visit a restaurant. There are toilets in a particular restaurant in Paris that are so exciting with an aquarium, and pretend peep holes, that is worth the detour.

So come, let’s have some decent toilets and be proud if people come off the street to use them. They might buy a coffee for the trouble.

Are exhibitions on the way out?

I was fortunate enough to attend the Carole Nash NEC Bike show last week. I worked in the bike industry for a couple of years so I know it quite well. The bike industry is suffering just as much cars despite less media coverage about it. New bike sales are significantly down year on year, and we are seeing major manufacturers downsizing teams in Superbikes and Moto GP or pulling out altogether

What about the punters though? The NEC show is a mecca for any bike enthusiast – a chance to see next season’s bikes unveiled and buy a load of gear. But this year no Harley Davidson stand, no Honda stand. Two of the major brands have pulled out of the show and Ducati had a tiny stand that looked like an afterthought. So is this a symptom of a declining industry? Or is it that exhibitions just aren’t what they used to be?

Both have stated that they are concentrating on customer experiences and showcasing bikes on track days or demo days rather than exhibitions. This indicates that the brands are really looking for closer customer contact and interaction than an exhibition can provide. It also suggests that the return on investment isn’t there.

This is backed up by the fact that the leading bike insurance provider Bennetts pulled out of the NEC show over 5 years ago. Not going to the show?! It was a sacrilege at the time but hasn’t done them a jot of harm thanks to the British Superbike sponsorship in its place. Arch rival insurance provider Carole Nash has taken the opposite view, as title sponsor of the whole event, they have put large sums of cash into the event with a huge expensive looking stand.

Interestingly, both Harley and Honda are attending the London Motorcycle show in February. It is highly important that all the major manufacturers are at a bike exhibition for visitor numbers to maintain. Clearly bike industry providers have alternatives to exhibitions these days so what can the NEC bike show do to improve their proposition?

Well I could come up with a really clever solution but actually in this case it comes down to a simple insight. Chatting with exhibitors, cost is a major factor. Not just the cost of the stand but the cost of staff. A lot of staff are working silly hours over 10 full days (not counting the trade day) and juggling the day job at the same time. A brand just can’t afford to employ 10 staff exclusively on the stand and what would be the use anyway since temporary staff aren’t able to talk confidently about the brand and models?

The NEC bike show is doing a lot right. As an organiser you have to work hard to attract the numbers. Competitions, VIP guests, events at the show. All of this creates a lot more interest for the visitor than just stands. However if they just condensed these activities into 5 days instead of 10 days, it would make for a more exciting and full day for the visitor and would reduce costs for exhibitors by up to a third.

So in conclusion it’s a question of being practical and getting the customers expectations to meet the trade’s scope and budget during these tough times and the NEC Bike show will be the focal point in the biking calendar for many years