The Seattle Times reports that Starbucks is dropping its global corporate name from its store in the Capitol Hill neighborhood in Seattle. The store was one supposed to close last year under the consolidation plan. Instead, it is being reborn as an eco-frendly outlet with a rustic, neighborhood feel. How far is the local branding effort going to go? Pretty much all the way. You won’t see the Starbucks’ name or logo, and the coffee beans, teas, and other products will be branded with the 15th Avenue Coffee and Tea name. Those names are meant to give the stores “a community personality,” said Tim Pfeiffer, senior vice president of Starbucks global design.

Most branding discussions I have with clients have to do with taking a local brand global or maintaining a global brand identity. Here’s Starbucks taking an opposite course. Smart move? You bet! Howard Schultz is taking advantage of the consumer trend of buying local, a particularly strong sentiment here in the Northwest. Starbucks has been losing foot traffic in recent years. The new coffee house will attempt to attract local residents not only with the re-branding, but also by serving beer and wine, hosting musical performances and poetry readings - all items that should appeal to Capitol Hill residents. But can the new store distinguish itself and hold its own against the truly small, locally owned and operated coffee house, like Victrola Coffee Roasters also located on 15th Avenue? Its owner, Dan Ollis doesn’t think so. “Starbucks is Starbucks and we are different from them,” he was quoted in the newspaper.
I think I’ll have to drive up there next month and check it out for myself.

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Two years ago I wrote extensively about how Starbucks had undercut its brand experience to rapidly grow the number of outlets. I warned that degrading the customer’s sensual interaction with coffee beans and the espresso making process would open the door to low end competitors. Sure enough, McDonalds and Dunkin Donuts, among others, are making a strong play for high-end coffee drinkers who have been held captive by Starbucks, Peets and local coffee shops.
And Starbucks gave them plenty of ammunition. Specifically, in its desire to cut costs of opening new stores, the comapny had lost many of the core experiences that made Starbucks a Starbucks. Walking into an outlet, you did not get the wonderful aroma of freshly brewed coffee beans. Baristas were placed behind high counters with espresso machines that were fast, but not particularly fun to watch. Artistic flair was replaced with functional speed. In an internal memo to his managers, Howard Schultz had himself complained that the aroma and theatre that had originally catapulted Starbucks into the world’s premiere coffee house had been lost.
Facing this increased competition, Starbucks is bringing back the core Starbucks experience. Hurrah! Beginning next month, baristas will grind fresh coffee beans each time a fresh pot of coffee is brewed (currently they grind the beans once in the morning). Based on how busy the shop is, baristas will brew fresh pots every 8, 12, or 24 minutes, switching to different varieties so that customers won’t have to be disappointed when they request a particular blend. Espresso will once again be made with flair, the hiss of steam filling the air. Will it slow down the process? Probably. Is this a good tradeoff? Absolutely. Speed and efficieciency is not a battle Starbucks is going to win with McDonalds or 7-Eleven. More importantly, it’s not as relevant to the customers as the true coffee house experience. 
Investing again in a superior customer experience is a wise brand strategy. Managers focused on quarter-to-quarter results would have been tempted to dumb down the Starbucks experience, perhaps offering a sub-standard cup of “everyday espresso drinks” to match the price of the fast food giants. But Howard Schultz is adopting a high road strategy. To some this may be counterintuitive, given the current economic downturn. To me, it’s right on, and will position Starbucks for growth as the economy recovers.

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Today we launch the new design4brand home page, with the specific goal of increasing contacts and client contracts. We’ve applied insights and tips from our friends at Marketing Experiments to increase clarity and reduce friction. The fancy term for this is “landing page optimization.” What it means is that your website visitors know where they are when they hit your site, what they should do, and why they should do it. Why should they buy your products or services?
So, what specific changes have we made? The graphics at the top remain, but we now have a stronger and clearer value proposition. Visitors know right up front what we do and how that may benefit them, and how they can contact us to start the discussion. The flow of information follows a natural progression with a call to action.
We’ve moved the educational components of branding strategy from the home page. We thought we were so smart in placing tips and tricks right there so that clients would realize just how smart we were.  Now we know better. Now we want to connect with our clients’ issues first, then educate them later. We still have our search engine optimization words so that you’ll find us organically, but now you have clearer information as to whether our services match your needs.
We are now certified by Marketing Experiements in the area of Landing Page Optimization - which simply means that we can help you get more sales once a customer finds your website. 

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Faced with the need for additional revenue streams, Microsoft corporation is planning to open a “small number” of retail stores, ostensibly to gather better insights into what customers truly want (apparently they are not hearing enough from Vista users…). To spearhead this effort, Microsoft has hired David Porter as VP of retail stores. Mr. Porter has recently served as the distribution manager for DreamWorks Animation SKG, but has spent a much larger part of his career as an executive at WalMart. Does this choice alone predict how successfully Microsoft will compete? Eight years after the opening of the Apple Store, will Microsoft’s efforts follow in the tradition of Vista or will they truly innovate the retail experience?

The folks up the road in Redmond have been testing out retail designs in their 20,00 square foot wharehouse. But the hiring of a former WalMart Exec suggests that the emphasis will be more on destination shopping strategies and efficient supply chain versus an inviting atmosphere and superior staff that one finds at the Apple stores. I imagine if an MS Store opens in Pioneer Square here in Portland, I’ll be standing in line with others, bringing in my laptop with the Vista OS and pleading with the MS sales staff to fix this @*&## thing! I doubt I’ll get much help.

And this raises a fundamental issue for Microsoft as well. The Apple Stores are designed to work wonderfully well in promoting the Apple products. People come in to try out the latest iPhone, iPod, etc. Microsoft will need people to come in and try out the newest version of their software, but will that draw them in. People love to play with new gadgets, not new operating systems.

 I wish them luck, but they will have to double down on the retail experience or face the equivalent of the Vista failure.

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