business news in context, analysis with attitude

Responding to our stories about Starbucks closing its US stores this week for three hours so its employees could be retrained, MNB user Pete Healy wrote:

It's been interesting to see Howard Schulz return to the helm at Starbucks, and nice to know about their refresher course on making espresso shots.

More interesting: Is this just Starbucks' first step in rehabbing their brand experience for customers?

Starbucks arose as the spread of other mass retail (including fast-food chains) decimated many older, independent cafes, diners, and coffee shops where people traditionally hung out with friends. Starbucks thrived because it filled that void in the new retail landscape, providing millions of people a place where they could once again relax with friends or family. The coffee, while better than the often thin, stale brew served elsewhere, was a vehicle to that broader brand experience: the warm and intimate decor, the hints of Europe in the product offering, the controlled use of visually appealing "farmers market" merchandising, and other elements that caused customers to relax, linger, and leave with a good feeling (that many would deepen with return visits).

The problem, though, may lie in how that brand experience began to decay with Starbucks' phenomenal growth. Longer lines, longer waits (especially for coffee "purists" stuck behind five people all ordering customized dessert drinks), more noise, unwiped tables: the in-house brand experience was feeling more and more like an airport terminal. And outside the house, you could now buy Starbucks from their drive-thru window, off the supermarket shelf, or jammed between two other passengers in coach on United. Where's the brand experience in that? It devolves into little more than an incrementally better cup of coffee--or maybe not even that, as dark roast coffee steadily becomes the new standard, whether it's Folgers or (gasp!) McDonalds.

Starbucks has come dangerously close to commoditizing its brand by detaching the tangible product (coffee) from the deeper and more powerful emotional bond that customers developed through the full in-store brand experience. Can Starbucks restore those bonds by stepping back from the "airport terminal" effect, and return to providing customers with a "home away from home" to enjoy with friends and family?

MNB user Rick Marcum wrote:

I love Starbucks and am, as you, a loyal customer. My wife and I visited one here in Carlisle, PA, a couple of Saturday’s ago and spoke to the manager about a new coffee, Black Apron, and how it tasted. While we were enjoying our coffees the manager brewed up the Black Apron in a French press and offered us samples that also included samples of the black bottom muffins. We ended up purchasing the coffee and a new French press and will continue to patronize Starbucks here and as we travel. Their move to close and retrain can only strengthen the Starbucks position as a leader.

Starbucks promoted a new quality promise this week when it reopened its stores, prompting one MNB user to write:

"Your drink should be perfect, every time. If not, let us know and we'll make it right." – What is so special about this concept? Don’t you have them “make it right” whenever they make your drink wrong?

The bottom line is Starbucks has lost their reputation of being a quality establishment. They are now just another coffee purveyor that makes a wrong cup of every once in a while. They need to do something greater than just - “Your drink should be perfect, every time. If not, let us know and we'll make it right."

MNB user Henry Stein – who, it should be noted, is a Caribou Coffee executive – wrote:

It should be noted that we display such a sign in all Caribou stores and also have it printed on all our pre-packaged coffee. "If for any reason you are not satisfied with your drink, we will gladly make it again."

Perhaps they are benchmarking us!!


An MNB user wrote in yesterday and suggested that in view of some reports that the industrial agriculture system is causing greater numbers of outbreaks of diseases such as E. coli, what really needs to happen is a shift away from this system. I asked exactly what this meant, and what we would shift to…and got a number of answers.

MNB user Liz McMann – who made the initial comment - elaborated:

I am proposing a system of local farmers and producers that provide for their communities. I am also proposing a system where animals are not merely machines with corn as the input and meat as the output. I am proposing a system where our regulatory agencies are able to make the holistic connection between the health of our environment, animals, and humans. The better we treat the Earth, its creatures, and its resources, the more sustainable our food and environment will be.

For example, we know that cows are “made” to eat grasses. When we feed them corn and soy we are disrupting a system that extends far beyond the cow. It affects the proliferation of E. coli, impacts farmers’ decisions of what to grow, encourages use of pesticides and GMOs to constantly increase commodity crop production, encourages food products filled with high fructose corn syrup and soy isolates, and discourages production of the very things that we are supposed to be eating more of: fruits and vegetables.

I’m sure that some will say that this proposed system is idealistic, but it worked for centuries before the age of industrial agriculture and petroleum based farm products. Already there are examples all over the country of a resurgence of local farmers feeding their communities. The Twin Cities Natural Foods Co-ops are a great example of a system of retailers working together to partner with local farms, producers, and distributors to keep our food system sustainable. Eat Local, Go Co-op!

One MNB user said in an email that cattle are not supposed to eat corn, which led another MNB user to write:

Couldn't keep my mouth shut on this one -- since when aren't cattle supposed to eat corn?

When I was a kid growing up in the cornfields of northern Indiana, the fence fell down between the meadow where the cattle were grazing on grass and the neighboring cornfield. The cows were easy to find -- they were all stuffing themselves in the cornfield. Guess they never read that email. (Deer and horses will do just about anything to get into a cornfield, too. Guess they don't read, either.)

Another MNB user wrote:

Every time you venture into agriculture I smile. And I'm far from being an expert. I just live in a rural area.

Cattle are ruminants, they were designed to get nutrition through grazing. They have multiple "stomachs" to aid in processing roughage. Cud chewing is a mechanism to further break down fibers such as grass stems. But grazing takes space and time. Think of the land wars in old westerns over grazing rights and the incursion of smelly sheep onto cattle lands.

Grain is highly concentrated food and it was discovered that you could confine the animals in feedlots and get the cattle to gain weight more quickly, thus reducing your time to market and investment in land. The higher cost of feed was offset by faster yield. Remember a time when "grain-fed" beef was a positive adjective? The texture and flavor of the meat is also different, and more consistent.

Enjoy your next hamburger!

You’re right … I tend to be way out of my comfort zone in these discussions. I’m essentially a city kid, with little knowledge of where food actually comes from. My idea of agriculture is a vineyard…but the closest I want to get to it is sitting in the tasting room that overlooks it.

MNB user Philip Bradley wrote:

I agree with the e-mailer. The increasing number of E. coli infections, etc., are largely due to the nature of the beast itself. When food is increasingly produced like widgets in a factory, I feel that these problems will get worse, not better. The epidemiologist at the U of Minnesota thinks that all our food should be irradiated, ignoring numerous scholarly journal articles that observe side-effects (smell, taste, and others that are worse) with the use of irradiation. His solution would take our food system one step further down the "factory" road.

Ideally, the system should be scaled back, with less emphasis on "efficiency" and "progress" (is it "efficient" to produce food that increasingly causes infection?), Worse, the factory food system does terrible things to the soil (chemical fertilizers) and nearby living things (chemical pesticides). Consider the "dead" area, many square miles of ocean at the Mississippi delta, caused by runoff of these chemicals, as well as countless other unfortunate by-products in our environment.

As for cost: why is it the major criterion for our food system? Food is not a "product," it's what we put in our bodies. As I recall, food only costs about 6% of the average American's budget. That seems insignificant considering its importance. In countries where food is truly valued for what it is, and not treated like a factory product (i.e., France and Italy), consumers are happy to pay a lot more. I must say that I think the attitude about food in both countries is a lot more sensible and life-supporting.

My personal gripe is that I don't care if 90+% of Americans want to eat factory food. That's fine with me. I simply want the freedom to eat food that is grown with care for the food itself, the soil, and the environment. But big agribusiness is not content with the current situation, they want to jam more of the same down everyone's throat. I am speaking of genetically-modified foods, irradiation, etc.

I would like the farm bill to include money for farmers transitioning to sustainable agriculture, as well as more money for conservation, and less for subsidies to corn and soybeans; and I'd like the freedom of choice of buying GMO-free food--and having GMO food labeled as such. Is this all too much to ask? Apparently it is, when you consider the attitude of Monsanto, Cargill, ADM, etc …

If you want to know more about the drawbacks of the industrial food system, read Michael Pollan's “The Omnivore's Dilemma,” and Barbara Kingsolver's “Animal, Vegetable, Miracle” - both superb books, surprisingly even-handed, and extremely informative. As an authority on the retail food business, you really should understand this point of view even if you don't agree with it.

I’m not at all sure I disagree with many of your statements. I just don't know if it is workable in 2008 America…but that doesn’t mean you are wrong.

Finally, here’s a great idea from an MNB user:

I have a suggestion for grocery store owners, large and small, that want to encourage shoppers to use reuseable bags in their store: Put signs in your parking lot reminding shoppers to bring in their bags! I have a few canvas bags and I always MEAN to use them but just forget I have them, and am not likely to go back outside once I’ve entered the store. A sign in the parking lot would be a great reminder. (They could be added to the signs on cart-return corrals or something...)

Excellent idea…and if any of you adopt it, please let me know.

KC's View: