Local Is So Hot Right Now
Decatur Metro | August 15, 2009
So hot in fact that all kinds of big ol’ corporations are trying to get in on the action, as documented in this article from The Wire. Starbucks’ efforts are especially interesting…
In one of the more brazen attempts by a corporation to disguise itself as a locally owned business, Starbucks is un-branding at least three of its Seattle outlets. The first of these conversions, just reopened after extensive remodeling, is called 15th Avenue Coffee and Tea. All of the signage and product labels bear this new name. The Starbucks corporate logo is nowhere to be seen.
This is the latest, and arguably most audacious, in a string of corporate attempts to imitate and co-opt local-ness. But there are plenty of other examples.
h/t: LaVida Locavore (via Mark Bittman)
Photo courtesy of the Seattle Times
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Oh no! You mean corporations are trying fool us!? and thereby gain even more influence over our lives, thoughts, and wallets? I’m absolutely appalled.
I visited the 15th ave coffee shop last week. It was hopping! There really isnt any evidence that its a sbux. This leads me to suspect that Sbux’s ‘disguise’ strategy will work (once the media buzz wears off).
The news around 15th (the ‘hood and not the coffee shop) was that the sbux crew were taking notes on the nearby coffee shops in an attempt to replicate that “local” feel. And, they weren’t trying to hide their activities or motives.
Of course, the real test isn’t the coffee or the prices. It’s the wifi. I didn’t check to see if 15th Ave Coffee and Tea offers free wi-fi (i.e., free of charge, free of promotions/adverts). If not, then they’re likely doomed.
That author apparently missed one of the important concepts about the Starbucks concept, which is to test cafés that serve alcohol and provide live entertainment in the evenings. If the existing locations did that, for example, would it alienate customers that wouldn’t appreciate having a band play while patrons talked loudly under the influence of alcohol? If you’re a business traveler headed to Starbucks mainly for WiFi and a relatively quiet place where you can get some work done, would you want all that? Although I have not been to 15th Ave, my understanding from the original announcement way back when is that the coffee would be clearly labeled as “roasted by Starbucks” or something to that effect. They also serve Starbucks ice cream (something their regular retail stores aren’t able to do). Additionally, they offer Clover coffee, which is definitely superior to the regular brew at their retail locations (Clover is owned by Starbucks). I love supporting independent/local places, but I appreciate the giant retailer’s attempt to realize that others may be doing some things better than them. Oh, and since the three test locations are in SEA…they ARE technically local!
Ok, Stuntbucks wants to test the concept of a coffeehouse that serves alcohol and has live music. How novel, maybe they can serve bagels and pastries too. Still, even your statement sounds like they are trying to take business away from local establishments.
Well of course they want to crush the locals. That’s the problem, in my mind, with the biggies. No one wants simply to open a shop and make a living, they want to return 12% to their shareholders every year.
The reason I go to Java Monkey? It’s because I volunteer for stuff and when I show up at dawn for the Decatur This Festival or the Decatur That Festival and see that big jug of coffee that has been donated for the volunteers, I am mightily grateful.
By the way, if the references in the article cited above to Clover have intrigued anybody, it’s sold at Dancing Goats.
Sometimes I feel like I’m the only one who ever took an economics class here. Tiffany, you (and others) have a hostility toward “big business” that is foreign to me. Let me ask you a question…do you have a 401(k)? An IRA? A mutual fund? Any stocks? If you’re a smart investor, you have at least one of these things. Guess where the returns come from…yes, those same big companies you are vilifying.
I talked about this in the Decatur CD/Wal Mart kerfluffle (love that word). Most large businesses like Starbucks were once small businesses like Java Monkey. They don’t start out big and “crush the locals.” They got big because they were managed by smart risk-takers who legally made the free market work for them.
If you don’t like the big businesses, I recommend you vote with your wallet (as you do by going to Java Monkey). But Starbucks obviously provides a product that people like, or it wouldn’t have become as big as it is. Yes, I recognize they have made some serious strategic mistakes and have let McDonald’s and Dunkin’ Donuts (two OTHER big companies) eat their lunch, but they are smart enough to recognize this and try new things like the 15th Avenue Coffee and Tea.
“And in the right corner, fighting for corporate interests…Errrrrriiiiccccc!”
Funny, that this big business discussion involves the retailing of an addictive substance…
I have to flash forward to, I don’t know, 2015 in California, where people will be complaining about the business practices of La Herba Mexicana, Inc.
Hee…
One more thing, free market does not necessarily mean shut everyone else down–in fact I take it to mean the opposite–as in, everyone has a shot. If a bigger company comes to town, adopts the methods of local businesses, and, by virtue of their bigger resources, pushes out the smaller guy–through increased advertising, bigger storefronts–than all the bigs are doing is trampling the smaller guy, leaving him no room to operate. And that sounds like social Darwinism to me.
Oops, forgot to mention how much I love the word “sheeple”.
Where is George Orwell when you him?
W.
I’m not necessarily fighting for corporate interests, I’m speaking in favor of business in general, large, medium or small. I’m not completely naive in that I understand large businesses engage in predatory pricing and marketing tactics to the detriment of smaller businesses. But it’s easy to forget that the Starbucks juggernaut also started as a single store in Pike Place Market in Seattle. They must have done something right to overcome the efforts of their larger competitors to crush them. Against the odds, they weathered the storm and made it big. Every company in America has that opportunity; they just need to find a way (like Starbucks did) to compete.
Anyway, I don’t like coffee, so neither Java Monkey nor Starbucks is getting my money.
And I agree; “sheeple” is a great word.
Perhaps “crush” was too emotionally laden a word. It’s not my intention to vilify. As I am sure you did not mean to address me as if I am an idiot. I simply contend that if a business wants to continue to provide a good return to its investors it needs to sell more of its stuff. Which means it has to increase its share. That is, take its competitors’ customers away.
“That is, take its competitors’ customers away.”
–thereby Crushing the local, less-funded establishments.
I’m still waiting for someone to reconcile the “everyone’s got an equal shot” argument with the active lobbying done by many huge companies to unlevel the playing field in their favor. Or does economic theory change once you get that big?
Some alter their lifestyles to fit their philosophy. Some alter their philosophy to fit their lifestyles.
Well, this–
“…still waiting for someone to reconcile the “everyone’s got an equal shot” argument with the active lobbying done by many huge companies to unlevel the playing field in their favor.”
–is why it appears that we have a free market.
Unless it’s interpreted as “we are free to do WHATEVER we want to make a profit” then, uh, hunh, hmmmmn, ENRON.
DM,
When you ask for someone to reconcile the “everyone’s got an equal shot” argument, I believe you actually may be looking for a defense. Can I give you an example instead? First, let me make clear I am making no judgements about the players involved in this story…it’s just an example.
Once, not so long ago…Sears, Roebuck & Co. was the BMOC of the retail arena. They did everything Wal Mart currently does to remain on top. They out-marketed the locals. They spent lots on advertising. They wielded immense control over their suppliers. And they contributed MILLIONS to lobbying efforts to get politicians to vote in their favor. How do I know this? I was there, and it was made very clear to all managers that if they didn’t “donate” a certain percentage of their salary to the PAC (political action committee), their career would be stunted.
Fast forward to today. Wal Mart, the one-time little guy from Arkansas, found ways to defeat the monster that was Sears, and took over as the retail king. And Sears, that one-time behemoth of the retail industry, is an afterthought who only remains in business because of the Craftsman name. Oh yeah, and they were bought by KMart, of all companies! I’m so glad I don’t work there anymore.
Again, I’m not making a play to support or rail against either of these companies. I’m just citing a real-world example of how a David can bring down a Goliath in the modern political and economic environment.
OK, I see where you’re coming from Eric. Essentially saying that even though Wal-Mart can try to protect it’s turf forever, it will inevitably lose ground to a smarter, more innovative newcomer at some point.
But I worry about the small business. The ones that don’t want to get bigger. They see what kind of harm a larger company must do to the environment and communities to compete in that arena and say no. I just think they deserve even greater protection under our great free market than they’re currently receiving.
My argument is not necessarily an anti-big business argument, it’s a pro-small business one.
Thank you DM. Back to Sugarland/walmart for a sec. Though many on this blog look at
Sugarland’s decision to sell exclusively to Walmart as being free market economics 101. Why not go for the money. Hardly. That’s not America. Sugarland selling their CD to any store which wants to stock it is more the free market America I love. Walmart would have stocked reguardless. So would the independents that got Sugarland their start. Sugarland is not a starving artist act. They have sold 7 million records. They are fine people, but nice people get bad advice all the time. An exclusive deal with Walmart is closer to Sopranos economics than free market economics. I just don’t get why so many middle class people ally themselves with and defend the rights of multinational corporations. Our goverment gives big corporations plenty of welfare through their lobbying efforts. Decatur CD can’t afford to lobby congress to get the rules of commerce written in it’s favor. Walmart can.
“Why Starbucks Actually Helps Mom and Pop Coffeehouses” -from Slate.com
“Strange as it sounds, the best way to boost sales at your independently owned coffeehouse may just be to have Starbucks move in next-door.
That’s certainly how it worked out for Hyman. Soon after declining Starbucks’s buyout offer, Hyman received the expected news that the company was opening up next to one of his stores. But instead of panicking, he decided to call his friend Jim Stewart, founder of the Seattle’s Best Coffee chain, to find out what really happens when a Starbucks opens nearby. “You’re going to love it,” Stewart reported. “They’ll do all of your marketing for you, and your sales will soar.” The prediction came true: Each new Starbucks store created a local buzz, drawing new converts to the latte-drinking fold. When the lines at Starbucks grew beyond the point of reason, these converts started venturing out—and, Look! There was another coffeehouse right next-door! Hyman’s new neighbor boosted his sales so much that he decided to turn the tactic around and start targeting Starbucks. “We bought a Chinese restaurant right next to one of their stores and converted it, and by God, it was doing $1 million a year right away,” he said.”
Article: http://www.slate.com/id/2180301/
The local Starbucks franchise may be owned by someone “local” and certainly the people who work there are “local,” so I don’t feel like I have necessarily trampled on anyone “local” in buying coffee etc. at Starbucks. Sometimes, shoppers/consumers appreciate a known product and venue and are not eager to experiment with the other shops available (local, or not). Competition is what it is, in business and in life: make an effort to make me love you and want to come back for more.
I believe all Starbucks are corporate owned.
The Starbucks website is a little wordy and confusing about this, but you are right, they do not offer “franchises” per se. The website refers to it as joining the Starbucks “program,” for which you have to “qualify”. So, who joined the “program” for the Decatur location is unknown (to me), but someone human presumably did. Maybe they live in/near Decatur, or maybe not. It would be interesting to know who, exactly, has made this investment in the Starbucks program for the Decatur location (as if that’s any of my business). In any case, the location is supreme, and I can not fault their service and products. I also go to Dancing Goats, occasionally, and like it almost as much. I also like Chocolat at the intersection of N. Decatur Road and Clairemont, and the Caribou locations. One thing I don’t like in a coffee shop is a crumb-filled sofa with a mousy smell, which nixes a lot of other shops.
Did you like Indie when it was there? It seemed unmousy, well-lit, uncrummy and high class. It’s name made it clear that it wasn’t a franchise! It’s been replaced by Cafe Cliche which is also non-mousy, non-crummy, well-lit, with WiFi, has great coffee, and offers a lot more too like desserts, ice cream, and sandwiches. I agree that there’s a certain coffeeshop style that’s somewhere between alternative and grungy. Poor lighting is a no-go for me; what’s the point of coffee if I can’t see well enough to read my paper, novel, or (if I had one) peck on my laptop.
Yes, I did like Indie’s coffee, teas, and pastries, but I don’t think their book side-line was entrancing in any way and it also took up valuable space. I ordered their “high tea” one day, but didn’t get much for the $ and it was delivered to the miniscule table on a 3-tier
rack that might as well have had blinking Xmas lights on it. I quickly moved everything to a single plate and took the tiered rack back to the server. Ha – serves me right – I must have thought I was in Vancouver (or somewhere)…
Oh, dear. The owner, Ivy, had channeled right into my brain and soul and picked exactly my style of books. I guess my preferences aren’t all that generalizable to others. No wonder Ivy had to sell the place. The current Cafe Cliche only channels my cupcake and latte preferences–hopefully that won’t hurt them.
Maybe the McDonald’s on Commerce will rebrand as the Decatur Grand Cafe.
Two observations:
Economics & consumer choice are rational.
Fear and anger can be irrational.
These two, in combination, explain much of the grumbling about “big business” and “corporate greed” while big businesses & franchises continue to flourish.
In the end, Starbucks and Wal*Mart are here because we want them here.
(Just one friendly capitalist’s opinion.)
Going to disagree with you here that economics and consumer choice are “rational.” Quite the contrary, the entire point of advertising and marketing is to convince consumers to make choices that are not rational. Eating at Golden Corral is a terrible horrible idea. It is cheap, quickly made food that is only notable because of the massive quantities it is served in. Eating there is effectively poisoning yourself – you go and you gorge yourself on cheap, nasty garbage like a low-rent Roman emperor and what have you gained? (besides sixty pounds)
Consumer choice is driven first and foremost by desire, which is inherently irrational. Large corporations thrive on turning a so-called rational individual into an irrational consumer. This is done by manipulating desire via advertising/marketing/branding/PR. I’m not saying it’s BAD, mind you, but the end results are very rarely rational.
Corporations selling food are always doing their research to find out what the best combination of fat, sugar, and salt is so that customers will not only eat more of their product but eat it more often (become addicted.). If you doubt this, try the simple experiment I used. My favorite snack is packaged trail mix from Costco (portion control alert to begin with). I found myself not only eating more because it tasted good but eating it more often and whether I was hungry or not. So I removed all the M & Ms and guess what – small initial portion and no go-backs. Take one ingredient out of the mix and it disrupts the whole marketing plan
Serious question: Will these rebranded Starbucks still accept Starbucks gift cards and the like? I know that some other places that feature coffee “brewed by Starbucks” don’t – the little outlets inside one of the big bookstore chains, for instance.
I think you’re also seeing a splitting of Starbucks’ marketing – they’re hemorrhaging customers on the low end who just want a fast hot cup of coffee on the way to the office to McD’s, Dunkin, etc. On the upper end, they’re losing the hoity-toity (dare I say, the Decatur crowd) over exactly the sort of complaints seen in this discussion. Places that have locally owned-and-operated coffee shops are spinning it to their favor, too. I don’t think Java Monkey or Dancing Goats sell any sort of “stuck farbucks” type merchandise, but I know I’ve seen it before.
On the other hand, the advantage Starbucks has is the same advantage McDonalds has – it’s going to be the same cup of coffee everywhere you go. The Starbucks in Decatur makes the same coffee as the Starbucks in NYC as the Starbucks in Tokyo. That’s quite reassuring to the casual consumer, who doesn’t really WANT to try the double-roasted Jamaican borogrove underhill flavor beans. Unfortunately, a lot of those customers, like I said, are getting siphoned off by lower-priced competitors.
On the other-other hand, yes. The people who work at your local Starbucks are just that – local. You think they fly in a crew from Houston every day? I’ve never had a bad experience at the Decatur Starbucks, although when I have to sit and write/work for extended periods, I’d probably go somewhere that didn’t have parking meters…
(you talk about branding and identity and I will come out of the woodwork like you shined the freakin’ Bat-Signal.)
How DARE you visit ‘the big bookstore chains’ KOBP? It’s people like you that drove Wordsmith out of business and ruined downtown Decatur.
(Not sure if Decatur-themed satire comes across in this medium very well, but hope you got it). On a more seriouis note, great point about the consistency principal and the fact that, at the end of the day, most conusmers are of the ‘casual’ variety. We hear so much from the die-hards that we lose track that most folks just don’t want to spend too much time or effort thinking about their purchase decisions.
Was reading an article in business week on the plane up to boston last night. It was about the Starbucks CEO, Shultz, who himself hates the concept of souless corps and what Starbucks has become, but how he begrudgingly came to the realization that marketing and advertising and research is necessary to survive (particularly if you are selling $4.00 lattes) So Shultz is in Seattle recently and hears about this new indie ice cream shop that has a huge line out the door every evening, makes a visit there, and longs for the days when Starbucks held that kind of aura. Thus…the creation of the new branding concept run by Starbucks (15th Ave) but as pointed out by the moderator of this blog, this fact is generally disguised from the public.
Yes, we need businesses in our country for employment…large, medium, and small. However, lets make no mistake that most business is completely bottom line orientated. By nature you could say that it is sociopathic. I can understand why people can be skeptical of businss, free enterprise, capitalism, when these businesses are making manipulation a science.
Also, in order to survive and thrive in this world most of us do invest in stock options, 401k’s, IRA’s, etc. Its a scary prospect for any of us between 30-50 to wonder if there is going to be social security by the time we need to retire given the past 9 years of govt spending. However, herein lies another paradox. By investing in these companies and taking returns we are also all feeding into what we despise. We are the creators of the system that maddens us. Perhaps some companies are structured to do good….but most are continuing to create ecological devastation. The oceans continue to be polluted, the air and rivers and land continues to be polluted. This is generally not individuals doing this on a small scale but corporations on a large scale…whether its the materials such as petro chemical based plastic that is choking the seas…human rights abuses…animal abuses….agricultural land often being unneccessarily slathered with a myriad of cancer causing agents….Monsanto creating patented terminator seeds and marketing that this is the only way to feed the worlds growing population.
I think its frugal to understand that we need business but also understand that we, and future generations will pay a huge price by focusing only on the bottom line. Multinationals corporations that become so big, whether it be starbucks, walmart, or a defense industry business feeding the military industrial complex….will do anything to survive and grow….including wide scale manipulation (as above) and left unbridled…perhaps even mass murder.
Haiku:
Need enough market freedom
Need enough control
Why is this so difficult?
Seriously, I didn’t think I was interested in this thread but the posts lead to such simple, obvious, moderate truths that I can’t figure out why we aren’t all on the same page. We need enough market freedom to have a healthy economy. But to prevent market forces and human greed from running amok and ruining other people and/or the planet, we need some kind of market control. I guess the devil is in the details and this is why there are entire professions and careers devoted to the topic….
Verbose, but, Rick, dead on assessment.
Business as sociopathy- that’s a truly interesting take on it. You are actually making me think.
@KBP –
we’ll have to agree to disagree about whether a consumer’s desire is rational. Not every decision that is bad for you is irrational. And being susceptible to advertising does not mean one is manipulated into irrational behavior – that’s just effective messaging, IMHO.
I do think you make a very informed point about SB being squeezed between the two ends. That’s a common trap in the foodservice biz (and all product/services, I imagine) especially during changing economic times. I agree that SB’s response is effectively acknowledging this new reality.
It would be interesting to speculate on their other options…
Sometimes corporations do local better, but not always, than …ummm… uhhhh… locals.
Example: Starbucks, WalMart and Waffle House
Sometimes corporations deliver soulless commodities and charge you extra for that bad experience.
Example: Starbucks, WalMart and Waffle House
I think the whole “local vs. evil mega-corporation” discussion always gets off track on aesthetic or idealogical judgements. I’m guilty of this myself, so this is not said to malign anyone here.
My slightly different contribution to this is less about whether capitalism is good or bad (it’s great, IMO), or whether local is good or bad (it’s good, IMO), but about the combination of the two. Locally scaled capitalism is preferable to the national/global scale we see in many of these Starbucks/Wal-Mart scenarios. Here’s my reasoning:
1. Locally owned means the profits stay with an individual or group that is in the local community.
2. These profits are typically plowed back into the community because locals do things like more business with local suppliers, invest or park savings in the local bank, etc.
3. This builds up the local community’s capital base – the other suppliers are now doing better, and they too park more money in a local bank. The local bank has more money to lend to businesses. The environment for local entrepreneurs is thus richer.
4. In sum, a local merchant class develops and as we all know from It’s A Wonderful Life, this is a key builder of a community (ok, seriously, it is).
I don’t blame people for looking for better prices or known/consistent product lines at Wal-Mart or Starbucks or Amazon.com. People are free to make those choices. But the cost to local communities in the form of a hollowed-out merchant class is never factored in, either because it is unknown to most consumers or too far on the horizon.
Anyway, that’s the way I see it. I’d like to see hearts and minds won over to the local side on the basis of pro-capitalism, pro-entrepreneurship, pro-traditional town economic systems, rather than some of the snobby or idealogically divisive ways of thinking.
All this talk about JavaMonkey and StarYucks makes me crave Chocolate Coffee. Yesterday they were one lonely coffee shop on Shallowford Road, now they have three locations. Oh…but wait….they are a huge corporation compared to JavaMonkey. Evil, I say…EVIL!
I guess I’ll just order green beans, roast them myself and stay home with my Mr. Coffee. I’ll pay myself $4.00 to savings every morning. Then, I’ll take over the WORLD!
Ok…grandious thinking. Must get back to earth.
After reading this thread, all I can say is wow…
oh, and also: I am sure glad I simply order custom blend from Community Coffe in Louisiana, have them deliver to my door, and I make my own friggin’ coffee!
Paying for those fancy coffees/latte’s/ etc. etc. is just nuts in my very humble opinion.
It’s a wasteful vice for sure. But less damaging to others than the most addictions.