5 ms·

as an avid cafe-goer, i've looked into the economics of cafes and talk regularly with the coffee shop owners around me. competition is almost never a concern fo

as an avid cafe-goer, i've looked into the economics of cafes and talk regularly with the coffee shop owners around me. competition is almost never a concern for most small/independent cafes. starbucks doesn't matter competitively because their prices aren't appreciably lower and they cater to a different segment than independent cafe owners. the biggest problem is almost always reaching their target segment--like the people already sitting there with laptops--to drive enough transaction volume to be sustainable, which is squarely a marketing problem. rent and labor costs (operations) are usually the next biggest problems. competition ain't the issue.

bko 4y ago
"Marketing" usually means getting people to know about your product or service and getting them through the door. If the owner has people sitting there and wants them to purchase more, that's more increasing average revenue per user which is limited. How much coffee can someone drink? If someone drinks a plain coffee, getting them to upgrade to a higher margin sugary drink is hard. You can push food and snacks, but that's also limited since you're not a restaurant and the person can only eat so many pastries or dry goods. For every one customer sitting down there are likely 10 customers that come in during that time. Why focus on the person sitting down? Getting more people in the door is probably an easier way to get more revenue. Especially considering the amount of people that can sit around all day versus the amount of people that can walk by and pick up a cup of coffee to go. In that regard, competition is definitely a huge factor. If a coffee shop has a 15 minute wait while another one is 5 minutes, I would likely pick the faster one. You can prefer one brand to another, but service is a huge factor.
- clairity 4y ago
  yes, getting more people in the door was the point--a marketing problem, not a competitive one. what you don't want to do is give people a reason to eschew your shop with customer-hostility, which compounds rather than alleviates the marketing problem.
- Firmwarrior 4y ago
  If it turns into a cold and customer-hostile transaction, I'll just brew my own cup of coffee at home for 80 cents
  - JanSt 4y ago
    Yeah sounds like a MBA coming in and ruining a business by targeting the wrong metrics. Success comes by providing a lot of value, not by pushing as many people through the door as possible through creating an uncomfortable situation so the customer leave quickly.

bko 4y ago

"Marketing" usually means getting people to know about your product or service and getting them through the door. If the owner has people sitting there and wants them to purchase more, that's more increasing average revenue per user which is limited. How much coffee can someone drink? If someone drinks a plain coffee, getting them to upgrade to a higher margin sugary drink is hard. You can push food and snacks, but that's also limited since you're not a restaurant and the person can only eat so many pastries or dry goods. For every one customer sitting down there are likely 10 customers that come in during that time. Why focus on the person sitting down? Getting more people in the door is probably an easier way to get more revenue. Especially considering the amount of people that can sit around all day versus the amount of people that can walk by and pick up a cup of coffee to go. In that regard, competition is definitely a huge factor. If a coffee shop has a 15 minute wait while another one is 5 minutes, I would likely pick the faster one. You can prefer one brand to another, but service is a huge factor.

clairity 4y ago
yes, getting more people in the door was the point--a marketing problem, not a competitive one. what you don't want to do is give people a reason to eschew your shop with customer-hostility, which compounds rather than alleviates the marketing problem.
Firmwarrior 4y ago
If it turns into a cold and customer-hostile transaction, I'll just brew my own cup of coffee at home for 80 cents
- JanSt 4y ago
  Yeah sounds like a MBA coming in and ruining a business by targeting the wrong metrics. Success comes by providing a lot of value, not by pushing as many people through the door as possible through creating an uncomfortable situation so the customer leave quickly.