4 ms·

Starbucks, Coffee, and Coworking

17 points by landist 17y ago

jakarta 17y ago
I kind of think of Starbucks as that early innovator that did a lot of footwork, (massively) introducing something new to consumers, that was ultimately destroyed by new entrants in the market. Think what AOL did with home internet access. Starbucks made coffee not just something for adults/people who work but really brought it to a broader group of people with things like Frappuccinos. As a result, they kind of did all the R&D for competitors like McD's and Dunkin Donuts (along with everyone else that is coming out with iced coffee/coffee flavored drinks). These competitors are able to eat into Starbucks' moat and differentiate by supplying beverages at a lower cost and supplanting it with existing food options. It puts a company like SBUX in a tough bind and I'm not sure how they're going to regain the oomph they once had.
- edrtfgdr 17y ago
  They simply pretend to be a new startup. Think up a new name and a new image to compete/compliment starbucks and open stores nearby. Only the stock analysts need know they have the same owner. Then all the kids who are too cool for starbucks can go to new-cool-bucks, dispising the people who go to starbucks - while putting money in their pocket. It's like people who are too rich to buy VW but will happily drive an Audi.
eddylu 17y ago
Funny, I just wrote a blog post yesterday about our extreme bootstrapping ways at Starbucks titled "Two Guys One Cup". We have free wifi because one of us has AT&T DSL at home (and you can log in with multiple laptops at the same time) and we sometimes bring seat cushions to make the chairs more comfortable. http://grubwithus.blogspot.com http://grubwithus.blogspot.com
- antiismist 17y ago
  You can get free wifi at starbucks without any AT&T setup at home. The steps: - buy a starbucks gift card ($5 minimum) - register the giftcard online - use the registration info when prompted when you connect to the network at SBUX. - you must make at least one purchase each month on the giftcard, e.g. a tall coffee for $1.50. - you can only use two MAC addresses on that card. Otherwise they'll lock your account, but you can call and get it unlocked. - with said giftcard you also get free refills and free flavorings of some type too, even if you don't use the giftcard to buy the coffee in the first place. I go to starbucks pretty much every day and that's how I get online there.
  - rufo 17y ago
    Isn't there supposed to be a two hour limit? That's what AT&T/Starbucks claims, anyway...
  - graywh 17y ago
    http://www.starbucks.com/retail/wireless.asp http://www.starbucks.com/retail/wireless.asp On session per day, limited to 2 hours. https://www.starbucks.com/cardrewards/default.asp https://www.starbucks.com/cardrewards/default.asp
    - antiismist 17y ago
      That's the stated policy, but it hasn't been my experience. I've done many days at waaay over 2 hours.
- wallflower 17y ago
  You might find this entertaining, if you have not already seen it. 171 Starbucks http://www.youtube.com/watch?v=CwYxuV2dVzw http://www.youtube.com/watch?v=CwYxuV2dVzw
Frocer 17y ago
"Starbucks needs to do some corporate soul searching. Take a look at American Express. It doesn't sell credit, it sells membership. Coca-Cola doesn't sell soft drinks, it sells refreshment. Starbucks, what do you sell … besides coffee? What do you stand for? Ambiance? Community? Social consciousness? Until you figure this out, count on losing both customers and shareholders." This is totally wrong. In my opinion, Starbucks knows exactly what they stand for. They don't sell coffee, they sell a "lifestyle". If Starbucks were just a shop that sells coffee, it would've never become the giant it is today. People go to Starbucks to experience the hip, yuppie, modern ambiance. Not just for the coffee.
- mediaman 17y ago
  Indeed, what's so curious about this article is that Starbucks was the poster child for selling the experience versus the coffee, and has been used in many case studies to demonstrate exactly that point.
  - derefr 17y ago
    I think the idea is that, basically, the Starbucks "experience" is what city life in general now feels like for these people. Starbucks is no longer differentiating on personality, because now everything else is just like Starbucks. they need a new schtick.
    - lsb 17y ago
      Exactly; and ironically enough, more indie coffeeshops have opened up recently precisely because Starbucks set their price point expectations so high that they get good margins out of it, versus $1 drip coffee.
pradocchia 17y ago
Speaking of K-cups and single serve coffee, I recently discovered the Italian moka pot. Wow! Simple, easy to clean, makes good coffee.
- cdr 17y ago
  I loved my Moka for awhile, but in the end it lost out to the ease of the k-cup machine at work. Most days I just don't want to spend 8-10 minutes making a cup (between prep, brewing, and cleanup).
  - pradocchia 17y ago
    This is true. But, if you brew one really strong cup in the morning, you can cut it with boiling water several times during the day to make regular strength coffee.
jimboyoungblood 17y ago
I've been thinking about opening a cafe/coworking place in SF with some friends. Which of the following would make you most want to work there? - great coffee - plentiful power outlets - comfortable seating - community (presence of other hackers/entrepreneurs)
- menloparkbum 17y ago
  Coffee, power outlets, a price that isn't ridiculous like the current co-working spaces in SF. Maybe some sort of programming quiz to keep out the weird "social media consultant" crowd. Also 24 hour access. Most (all?) coffee shops in SF close too early.
  - Raphomet 17y ago
    Yeah, the prices are hard to justify. I don't have $300 or $400 to spend every month on top of rent money. All the co-working spaces I've visited here seem like nice places to work, each with its own individual culture and network, but the price tag is unfeasible for unfunded bootstrappers.
    - mediaman 17y ago
      $300 isn't very much when you look at the loaded costs of setting up and running a coop. Offices are expensive. And if not an office, I'm not sure how one would ever create a 24 hour coffee shop. A typical Starbucks lives off of customers who spend $100/mo and take up no room -- $5/latte by 20 working days and five minutes in and out. How would some coffee shop ever survive by charging three times as much for someone who takes up 100 times more time lounging around in chairs?
      - edrtfgdr 17y ago
        Someone occupying an otherwise empty chair has zero marginal cost. In fact to a restaurant, people at tables has a negative cost just before the busy period - would you pick an empty restaurant? People in a starbucks at non-peak hours aren't a problem and may even attract other customers.

17 points by landist 17y ago

I kind of think of Starbucks as that early innovator that did a lot of footwork, (massively) introducing something new to consumers, that was ultimately destroyed by new entrants in the market. Think what AOL did with home internet access. Starbucks made coffee not just something for adults/people who work but really brought it to a broader group of people with things like Frappuccinos. As a result, they kind of did all the R&D for competitors like McD's and Dunkin Donuts (along with everyone else that is coming out with iced coffee/coffee flavored drinks). These competitors are able to eat into Starbucks' moat and differentiate by supplying beverages at a lower cost and supplanting it with existing food options. It puts a company like SBUX in a tough bind and I'm not sure how they're going to regain the oomph they once had.

edrtfgdr 17y ago
They simply pretend to be a new startup. Think up a new name and a new image to compete/compliment starbucks and open stores nearby. Only the stock analysts need know they have the same owner. Then all the kids who are too cool for starbucks can go to new-cool-bucks, dispising the people who go to starbucks - while putting money in their pocket. It's like people who are too rich to buy VW but will happily drive an Audi.

eddylu 17y ago

Funny, I just wrote a blog post yesterday about our extreme bootstrapping ways at Starbucks titled "Two Guys One Cup". We have free wifi because one of us has AT&T DSL at home (and you can log in with multiple laptops at the same time) and we sometimes bring seat cushions to make the chairs more comfortable. http://grubwithus.blogspot.com http://grubwithus.blogspot.com

antiismist 17y ago
You can get free wifi at starbucks without any AT&T setup at home. The steps: - buy a starbucks gift card ($5 minimum) - register the giftcard online - use the registration info when prompted when you connect to the network at SBUX. - you must make at least one purchase each month on the giftcard, e.g. a tall coffee for $1.50. - you can only use two MAC addresses on that card. Otherwise they'll lock your account, but you can call and get it unlocked. - with said giftcard you also get free refills and free flavorings of some type too, even if you don't use the giftcard to buy the coffee in the first place. I go to starbucks pretty much every day and that's how I get online there.
- rufo 17y ago
  Isn't there supposed to be a two hour limit? That's what AT&T/Starbucks claims, anyway...
- graywh 17y ago
  http://www.starbucks.com/retail/wireless.asp http://www.starbucks.com/retail/wireless.asp On session per day, limited to 2 hours. https://www.starbucks.com/cardrewards/default.asp https://www.starbucks.com/cardrewards/default.asp
  - antiismist 17y ago
    That's the stated policy, but it hasn't been my experience. I've done many days at waaay over 2 hours.
wallflower 17y ago
You might find this entertaining, if you have not already seen it. 171 Starbucks http://www.youtube.com/watch?v=CwYxuV2dVzw http://www.youtube.com/watch?v=CwYxuV2dVzw

Frocer 17y ago

"Starbucks needs to do some corporate soul searching. Take a look at American Express. It doesn't sell credit, it sells membership. Coca-Cola doesn't sell soft drinks, it sells refreshment. Starbucks, what do you sell … besides coffee? What do you stand for? Ambiance? Community? Social consciousness? Until you figure this out, count on losing both customers and shareholders." This is totally wrong. In my opinion, Starbucks knows exactly what they stand for. They don't sell coffee, they sell a "lifestyle". If Starbucks were just a shop that sells coffee, it would've never become the giant it is today. People go to Starbucks to experience the hip, yuppie, modern ambiance. Not just for the coffee.

mediaman 17y ago
Indeed, what's so curious about this article is that Starbucks was the poster child for selling the experience versus the coffee, and has been used in many case studies to demonstrate exactly that point.
- derefr 17y ago
  I think the idea is that, basically, the Starbucks "experience" is what city life in general now feels like for these people. Starbucks is no longer differentiating on personality, because now everything else is just like Starbucks. they need a new schtick.
  - lsb 17y ago
    Exactly; and ironically enough, more indie coffeeshops have opened up recently precisely because Starbucks set their price point expectations so high that they get good margins out of it, versus $1 drip coffee.

pradocchia 17y ago

Speaking of K-cups and single serve coffee, I recently discovered the Italian moka pot. Wow! Simple, easy to clean, makes good coffee.

cdr 17y ago
I loved my Moka for awhile, but in the end it lost out to the ease of the k-cup machine at work. Most days I just don't want to spend 8-10 minutes making a cup (between prep, brewing, and cleanup).
- pradocchia 17y ago
  This is true. But, if you brew one really strong cup in the morning, you can cut it with boiling water several times during the day to make regular strength coffee.

jimboyoungblood 17y ago

I've been thinking about opening a cafe/coworking place in SF with some friends. Which of the following would make you most want to work there? - great coffee - plentiful power outlets - comfortable seating - community (presence of other hackers/entrepreneurs)

menloparkbum 17y ago
Coffee, power outlets, a price that isn't ridiculous like the current co-working spaces in SF. Maybe some sort of programming quiz to keep out the weird "social media consultant" crowd. Also 24 hour access. Most (all?) coffee shops in SF close too early.
- Raphomet 17y ago
  Yeah, the prices are hard to justify. I don't have $300 or $400 to spend every month on top of rent money. All the co-working spaces I've visited here seem like nice places to work, each with its own individual culture and network, but the price tag is unfeasible for unfunded bootstrappers.
  - mediaman 17y ago
    $300 isn't very much when you look at the loaded costs of setting up and running a coop. Offices are expensive. And if not an office, I'm not sure how one would ever create a 24 hour coffee shop. A typical Starbucks lives off of customers who spend $100/mo and take up no room -- $5/latte by 20 working days and five minutes in and out. How would some coffee shop ever survive by charging three times as much for someone who takes up 100 times more time lounging around in chairs?
    - edrtfgdr 17y ago
      Someone occupying an otherwise empty chair has zero marginal cost. In fact to a restaurant, people at tables has a negative cost just before the busy period - would you pick an empty restaurant? People in a starbucks at non-peak hours aren't a problem and may even attract other customers.