Starbucks Via Instant Coffee as a Disruptor

I haven’t yet had an opportunity yet to try Starbucks’ recently launched instant coffe, Via, (I’m more of a Peets guy), but Scott Anthony has written a nice article about why it makes for an interesting disruptive play into the coffee market.

The company allegedly spent more than two decades developing Via, focusing on creating instant coffee with a taste profile that at least reasonably approximates in-store coffee. CEO Howard Shultz said, “We took a lot of time with it because we knew it could undermine the company if we didn’t do it right.”…

I wouldn’t say that Via was as good as a cup of coffee brewed at Starbucks (and truth be told, I prefer Dunkin’ Donuts coffee anyway). But in classic disruptive fashion, Via delighted me by substantially out-performing the other options available in my parents’ house. It is a great example of a company finding a powerful way to “love the low end.”

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Good User Experience Starts with Good Employee Experience

A few years ago I was enjoying brunch with some friends at the Tavern at Lark Creek, which is rightfully known for excellent food and attentive and friendly service. Part way through the meal I had to excuse myself to use the bathroom. The bathroom was up some windy stairs, and was very nicely appointed, even more nicely treated than the dining room itself. As restaurant bathrooms go it was very pleasant, but I did not give it much thought.

At the end of the meal before hitting the road for a slightly long drive, I decided to make another pit-stop. This time I saw a downstairs bathroom, which was not as nice as the first one I had used upstairs (thought it was not by any means unpleasant). It became clear that I had taken a wrong turn the first time and had used the employee bathroom.

I could have chosen to be miffed that the restaurant didn’t ensure that the guest bathroom was as good as it could be. Instead, I realized that the quality of the employee bathroom was one sign that the restaurant cared for its staff, and recognized that taking care of the EX - the employee experience - is a prerequisite to a consistently high quality UX - user (customer) experience. They realized that “customer centric” does not mean ignoring employees. In fact it’s just the opposite, if you want to offer truly good service to customers, you need to start with treating your staff right.

As Olive Garden President David Pickens puts it, “It’s very difficult for the experience of the guests to exceed the experience of the staff.”

When you look at the company’s that consistently deliver superior UX - Zappos, Amazon, Google, Southwest, Starbucks back in the old days, Levenger, Niemen Marcus, the one thing they all have in common is that they pay huge amounts of attention to the quality of life of their staff, creating a culture and infrastructure of training that help their staff do the right thing, even when there isn’t an exact rule about what to do in a novel situation.

As an extreme example, read the letter that Zappos CEO Tony Hsieh wrote to employees when the acquisition by Amazon was announced. It is manically focused on the culture of the company and the worklife of the staff, superseding just about every other concern. “Culture” shows up 23 time in it, 7 times in association with “unique”, and 21 times with “brand”. In other words, Hsieh makes an intimate connection between the internal culture of the company and the external brand as it appears to customers - he recognizes that the EX is directly correlated with UX.

Harley Davidson in a Skid

Reveries has some thoughts on the freefall that Harley Davidson currently finds itself in, battered by the recession

Harley’s slide certainly is tied to the recession, but there’s more to it than that. When times are bad, obviously it’s less likely that people will “shell out up to $20,000 or more for something that is basically a big toy.” It doesn’t help much that most of the Harley market consists of baby boomers who are watching their savings implode. But it also appears that Harley contributed to its own troubles in a chain reaction of mistakes.

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Harley is like Starbucks in that it created a strong customer experience, a sense of belonging, and then expanded that massively to a more mainstream audience. In the process, both lost their way. Starbucks let its experience get diluted at the edges, which impacted its core business. And the idea that by offering small luxuries it is recession proof has been sorely tested lately.

Both companies were on the vanguard of the experience economy, as Pine and Gilmore termed it in their book of the same name. They wrote, “The company that is perhaps most successful in embedding its goods into a total experience is Harley-Davidson. How many other company logos do you find tattoed on users’ bodies?” (p18).

Harley Davidson likes to pretend that they are of the people, for the people, a FUBU for boomers. But in reality they are in the high-end luxury escapism business. And when the bubble bursts, that’s a bad place to be.

Peet's Gets Job Applicants in the Mood

I was in a Peet’s Coffee today and while waiting for my drink noticed a stack of job applications. No, I wasn’t thinking about applying, but I was struck by how the applications looked. Normally applications are simple 1-sheet affairs with a list of questions on the front. This one had a whole bunch of prose. Curious, I picked it up. Here’s how it starts:

Application for Employment

First, a little Peet’s History

Known as the “grandfather of specialty coffee,” Peet’s Coffee and Tea has been a Berkeley institution since 1966 when Alfred Peet opened the first Peet’s store — with a roasting machine on the premises — at the corner of Vine and Walnut. Since that time our mission has remained unchanged — to pursue uncompromosing quality in every cup of Peet’s coffee or tea. By remaining steadfast in our quality commitment, Peet’s has spawned a devout following of loyalists who will attest that once you drink Peet’s coffee, it is unlike any other.

This is a wonder of compactness: a huge amount of legacy and what it means to be a Peet’s customer and employee is packed into this one paragraph. And the fact that they are addressing you — the prospective employee — with real language, not empty blather about “customer service” and “values” says a lot. This is a job to take seriously, not just kill time with.

It continues:

Peet’s has grown considerably since its beginnings with stores across the country… Essentially, though, Peet’s hasn’t changed much. We remain committed to delivering the highest quality and sharing an enduring passion for coffee and tea with our customers. Employees take pride in their work and their company and endeavor to provide the best customer service of any coffee company in the world. Peet’s prides itself on providing extensive training and enjoys hiring from the surrounding communities so that local ambassadors of the Peet’s brand operate our stores.

After the standard questions about contact info, days desired to work, work experience, etc. it has several questions that actually require some thought:

• What do you think you will enjoy about working for Peet’s?
• What is your definition of customer service?
• How often do you drink coffee or tea? What is your favorite type of coffee or tea?

These help weed out the people who are just looking to clock-in, clock-out, and screens for people who are genuinely enthusiastic about the product and the store. It helps ensure that they hire people who will be articulate and able to think on their feet and not have to resort to asking the manager for everything, or falling back on rote procedures, even if they go against what’s best for the customer.

It used to be that Starbucks had happy and enthusiastic employees who did a good job with coffee; today they are more likely to be bored and indifferent, or happy and get it wrong. It used to be that Peets had haughty, indifferent employees who made very good coffee; today they have happy, congenial employees who make very good coffee. I’ve been in enough of both establishments to know that both past and current personas are not accidental.

The Peet’s experience starts right at the beginning, with setting the tone of the job application.

Related posts:

• Say What you Mean, and Mean What you Say
• Starbucks Should be Worried
• Starbucks: Recession-Proof or Not?