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27 August 2015

Grounds for Desertion: The Last Stand of Starbucks’ Third Place?

by Freddy Tran Nager, Founder of Atomic Tango + Caffeine Addict…

Three yuppies walk into a Starbucks. Sounds like the beginning of a joke, and in a way it is. Two claim a table while the third goes to order. He asks the others what they want, and they both say “nothing.” He responds, “So why are we here?” One replies, “Someplace to talk.” The first guy scowls and says something that makes me want to high-five him:

“That’s gonna put them out of business — people like you.”

I look around. This West L.A. Starbucks is packed at 1 pm with people waiting for seats, but I see an old guy without a beverage napping in a chair, and a young woman at a table eating salad from Tupperware and drinking O.J. from a gallon jug she obviously bought elsewhere.

Since I’m a business guy who values what Starbucks offers, these sights make me more steamed than Dante’s cappuccino. In another establishment, a manager might tell these freeloaders to hit the freeway. Indeed, many coffee shops are taking a stand against freeloaders.

But this is Starbucks, and founder Howard Schultz envisioned a “third place” where people could linger and meet outside of work, school, and home:

“When our customers feel this sense of belonging, our stores become a haven, a break from the worries outside, a place where you can meet with friends. It’s about enjoyment at the speed of life — sometimes slow and savored, sometimes faster. Always full of humanity.”

Oh, the humanity. I can’t imagine this is what Schultz had in mind. If these so-called “patrons” are now hanging out without buying, all those efforts won’t amount to a hill of roasted beans, and that can mean only one thing: Hasta la venti, baby. I’m getting my coffee fix elsewhere!

What can Starbucks do? Some ideas…

  • Follow the Italian coffee shops (the source of Schultz’s inspiration) and charge $7 per cup to compensate for all-day hangers. But Starbucks has already suffered revolts by the price sensitive, and raising prices would only punish the legit customers.
  • Pull a Web 2.0 and “monetize that traffic” by selling ads in its stores. I’ve seen other coffee shops do this with ad-sponsored TV screens. But just as advertising isn’t floating too many dotcoms, I don’t think flashing ads will make a difference while people are chatting, reading or napping.
  • Take a stand — or more exactly, compel customers to do so literally — by taking away chairs. It’s working in some classrooms, where teachers are finding that students are more alert when they stand instead of sit. That would eliminate the snoozers and the lunchers — and many legit customers as well — but it would make room for lots of standing-only tables…

At the least, before taking any of these measures, Starbucks should just ask customers to drink up. Little tent cards at every seat could pose a friendly reminder:

“Thanks for visiting us today! We’re thrilled to have you here savoring our little home away from home. Nice, huh? Now we hope you’ll help us keep going by trying one of our gourmet coffees — we’re sure you’ll enjoy every drop! But if you’d rather just hang out all day without buying anything, our cousin Guido will soon come along to keep you company. After all, we wouldn’t want you to be lonely here, and he’ll even make you an offer you can’t refuse! If he seems really eager to have you drink some coffee, it’s not personal — it’s strictly business — and we wouldn’t want to upset Guido now, would we?”

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Freddy is the Founder & Creative Strategist of Atomic Tango. He also teaches graduate-level marketing communication courses at the University of Southern California (go Trojans!), shoots pool somewhat adequately, and herds cats. Freddy received his BA from Harvard and his MBA from USC.

7 Responses

  1. I heard that Nokia hold stand-up meeting with no seating specifically to make sure everyone stays on topic and that the meeting doesn’t end up being a discussion about the weekend’s football or whatever like so many do.

    Truth or Urban Legend? No idea but it’s an interesting approach all the same!

  2. LOL !! for a chain that’s built it’s base on yuppi-dom and the offers of vanity @ $4/cup – I would LOVE to see them try to take away chairs or tell their few remaining customers to, um, “drunk up”. They will get chewed up and spit out so fast, they venti-even know it. People are between jobs, angry, broke and still taking it both barrels from the establishment. Shut up, and sell your sweetened milk for less. Shush!

    Freddy’s Comment: So let me get this straight: because someone is between jobs, angry and broke, that gives them the right to hang out in a place of business and not spend any money? Nice planet you live on.

  3. One thing you might notice is how crappy the Starbucks bathrooms are: only one unisex toilet which is not very well kept. Thats a subtle yet great way for Starbucks to encourage people to get up and go elsewhere- let their bladders do the work!

  4. I’ve always been asking myself how could Starbucks afford having so many people spending only $3-$5 and sit there all day long. Actually, I saw a guy today sitting next to me in the 3rd st promenade location in Santa Monica and he was sleeping on his computer. A person from the staff woke him up and ‘gently’ asked him to leave because he was taking a seat for hours. My first thought was “Oh, she’s being rude, she cannot talk to a customer this way – this is not good for business”. But then I realized “ Hey, he’s actually not a customer – he’s not even spending $1”.
    Then, what would be a real solution for Starbucks to have people coming in, seating and going out in a reasonable period of time ?
    As you wrote in your post, some ideas seem great on the paper but are not quite conceivable.
    Also, I noticed that more and more new coffee shops (Alfred Coffee, Blue Bottle, etc) don’t install plugs in their locations so people leave when they run out of battery. Pretty smart! But, in my opinion, this would not work for Starbucks because I think that it would be a big of a change and people would get offended in some way.
    Anyways, thanks for this post that made me think a lot about the topic (and I am still thinking!).

    • retro

      Thanks for the observation, Margot! One tactic I forgot to mention is comfort: Starbucks seems to have the most uncomfortable wooden chairs in the history of wooden chairs. Coincidence, or strategy to make people move on after they’re done drinking? That said, from what you saw, those torture chairs apparently didn’t dissuade someone from falling asleep…

      • The chairs are perfect for torture,not only are they hard heavy and poorly contoured,but they make a hideously loud screech when moved across the tile floor.Reminds me of Sling Blade in the mental ward where the guy always drags his chair around to talk to Billy Bob Thornton

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