It would appear that some of the shine has come off Starbuck's. Store visits are down 1% (this is the first time store visits have dropped). In addition the stock price is dropping. So what's their solution? Start advertising, which they haven't done on a large scale before.
What I find interesting is that Starbucks has made changes to its stores over the last few years that you might not have noticed. Did you know they use “flavor locked packages†of coffee instead of freshly ground. Now the smell of fresh ground is gone. They also stopped “hand pulling espresso shots†in favor of automated machines. Finally they have streamlined the stores so they all start to look the same. They have lost the “funkyâ€. One more thing, it's now possible to make a cup of coffee at home that competes with the taste of Starbucks. While its still doesn't make cappuccino or espresso that competes, our Tassimo one cup coffee maker makes regular coffee just as good .
While the problems Starbucks is having are one most of us could deal with it serves as a reminder that its still the cutomer experience that makes the difference. They don't seem to realize this or they have just gotten to a point that it doesn't seem relevant to them. Public traded companies must keep those shareholders happy and one way to keep the growth is build more stores and cut costs. Something to consider when we talk about places like Urban Outfitters opening garden shops. They may pull off the corporate “cool†like Starbucks, the question of whether they can really be original and funky remains to be seen.