Starbucks of the Future… an Idea that Feels Just Right for the Brand

Starbucks is introducing a new concept idea this week. It will serve regional wine, beer, cheese, soup and other small dishes. While designated by location (e,g, “Olive Way store”), it will indicate it is “by Starbucks”. The interior will be more like a cafe that has been in the neighborhood for years, but extremely eco-friendly. This evolution into an after work, evening business just feels right for the times.

Often, brand managers rush to license a brand onto anything and everything that can contribute money to the coffers. There are many examples where brand line extensions have gone too far. (I remember when LaCoste put their logo on dog collars and rolled my eyes). Starbucks has made some missteps, too. But when they stepped back and began to understand that a very large part of the Starbucks brand was the in-store experience, then they started to make the linkages to interesting new store concepts. The “by Starbucks” concept has eat-at bars where you can talk to the barista, just like the good old neighborhood bar or pub. The lighting will be subdued and my bet is that this concept will be a successful gathering place for those who seek a certainty of quality in food and experience. As more formal restaurants struggle to stay in business, this new concept is so appropriate for the times we live in. It should attract a frequent crowd and expand revenues into the evening hours.

Just look around at the state of the economy. We’re down-sizing and right-sizing and becoming much more conscious about spending money. Our desire to go out hasn’t changed, but our ability to afford it has. So a modestly priced place to hang out over a glass of wine or a bowl of soup just seems to fit into where we are right now. And with the Starbucks renewed focus on quality, the food should be very good, and the atmosphere should be comfortable and secure. You could call it a predictable experience, but one carefully designed, tested and implemented.

In branding terms, we call this ‘fit’ and ‘stretch’ of a brand. Smart branders understand the rigor of determining how far a brand can be expanded without crossing the line. Disney is a good example of a brand that has expanded, generally successfully, since its roots as a cartoon studio in 1923. Today they are into publishing, broadcast television, music, movies, theme parks, cruise lines, apparel and retail stores, and on and on. Almost every time you experience a Disney branded product or environment, it shares consistent brand attributes. They have continuously experimented with fit and stretch.

Starbucks has also been testing a variety of ideas from products (branded ice cream) to cafe and bakery concepts. While many of the ideas come from revenue extension motives to alternate day parts, they also come from new foods and services. In addition, Starbucks recently purchased Pasqua to extend its food offerings thru the established locations they already own. But when it comes to the “by Starbucks” concept, we expect it will be a winner. Leveraging the enormous Starbucks brand franchise into an alternate day part with casual wine and cheese just plain feels like something the brand should be doing. While I’m sure their research will bear out this belief, we expect the concept to be part of redefining, once more after 40 years, the cafe experience. The stars seem aligned for Starbucks again.

Sipping a local cabernet and nibbling on a local cheese at the end of the day is what I’ll be doing.

How does the “by Starbucks” wine and cheese strike you? Do you think it will be a success?