Monday, May 10, 2010

4 Bucks For A Cuppa Joe?

The rhetorical question a lot of people ask, about Starbucks, is “who’d shell out six bucks for a cup of coffee you could get for 50 cents at the gas station?” Well, you can’t get much of a cup of coffee for half a buck, but there are gas stations where you can buy Starbucks coffee. And it's not six bucks.

There’s a whole bunch of them on the Illinois Tollway System. Pull into an Oasis to fill the tank, and stroll a few feet farther and find Starbucks, McDonalds, and other big national brands.

My friend Tim Moore, who’s a top-notch radio consultant, puts out an e-mail for his clients and friends every Wednesday called the “Mid-Week Motivator”. In his most recent one, Tim explains what broadcasters – and, for that matter, anybody in business – can learn from Starbucks.

First of all, Starbucks customers don’t pay six bucks for a cup of coffee. The average is $3.89. And the most telling thing about the way Starbucks trains its “partners” – not employees, not associates, not baristas, but partners – is the principal that “There is no customer request under our coffee umbrella we can’t or at the very least, attempt to fulfill”.

The customer, as Tim points out, really does come first.

My wife has dragged me with her into a Starbucks countless times; I’m off-put by the phony Italian lingo about “vente” or “grande” or whatever. Hey – this is America. Large, medium, small. And since I’m an obstinate old cuss, many times I say something like “what have you got that’s cold and good”….and the partner, no matter where in America we are, makes some suggestions.

One time, at a Starbucks in Tempe, AZ, a partner made a suggestion to me; and then said “tell you what – I’ll make it for you, and if you taste it and don’t like it, we’ll pour it out and try again”. Now THAT’s customer service. And, for the record, I loved it. Whatever it was.

Moore also reveals another lesson from the Starbucks playbook: “You are the company, you are important, and we will never promote someone from the outside, before we promote you”. Holy smokes…their people really are their company, and they acknowledge it. Employee turnover is minimal, and it’s no wonder.

Some people half-jokingly say Starbucks is out for world domination. According to Tim, part of the Starbucks creed for reaching customers is “We want to be your third place: standing behind your family and your place of work, we want to be part of your typical day”.

Radio used to be like that, and in some cases still is – but as Moore and his fellow top-notch consultants know, radio is losing its grip on its audience. Too much great local radio talent has been tossed under the bus in the past three years in the name of cost-cutting.

Radio station owners and owners of any business that has direct contact with people would do well to learn a lesson or two from Starbucks. It’s not just the coffee, silly.

1 comment:

  1. Starbucks has its critics, but it seems sincere about trying to be a good corporate citizen. So-called "Fair Trade" coffee is a prime example.

    Fair Trade coffee reportedly sells for a minimum $1.29 a pound. Compare that to the 25 cents it costs the Maxwell House folks to fill a one-pound can.

    The difference puts Starbucks at a distinct price disadvantage, but the extra money goes directly to the farmers, not to middlemen or corporate operations. The practice is said to have made an enormous difference in the standard of living for farmers lucky enough to be able to participate in the Fair Trade program.

    Meanwhile, Maxwell House (not to pick on that brand, but to use it as a figure-of-speech example) coffee is grown on corporate farms, oftentimes in areas where forests have been clearcut, and crops are spurred on by the use of environmentally nasty pesticides.

    It will be a laudable moment when the Maxwell Houses of the coffee world start growing coffee ethically and paying their workers a living wage for the coffee they produce. But, truth be told, before they win me over, those tin-can coffee purveyors will have to do something to make their product not taste like floor sweepings.