>Midweek Starbucks reExperience Update – 2008 Shareholder Meeting

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The reExperience Starbucks Project is a combined effort of Becky Carrroll at Customers Rock!, The Marketing Spot and the blogging community. Howard Schultz has promised to revive the Starbucks customer experience and we want to help.


A lot of hoopla going on over yesterday’s shareholder meeting. John Moore offers a penetrating analysis with his look at the Starbucks Transformational Agenda. Investors were not impressed as they dumped four percent from the stock price. But that’s ok. Companies shouldn’t worry about stock prices, they should focus on customers. Do that, and the stock price will take care of itself in the long haul.

I’m not going to re-hash John Moore’s analysis because it’s quite thorough. But if you look at the six initiatives announced by Howard yesterday, which ones are customer experience focused?

Here they are:

1. The switch to the Clover(R) brewing system that delivers a reportedly superior cup of brewed coffee.

At first glance you would say yes, that this is customer experience focused. But it really is not, it’s product focused. That’s not a bad thing, but Starbucks product quality has not been the issue.

2. In addition to using the new Clover(R) equipment mentioned above, Starbucks Baristas will be brewing a new and improved blend of coffee called the Pikes Place blend.

Again, this is product focused. There’s nothing wrong with that, but remarkable customer experiences are not just about product.

3. The introduction of a new state-of-the-art Mastrena(TM) espresso system to perfectly grind consistent espresso shots.

More product focus here.

4. Adding Rewards to the Starbucks Card

Some might say that this is experience focus, but not me. This is a marketing ploy. Rewards do not usually perform as they are designed. Rather than foster loyalty and enhance the customer experience, rewards can actually damage and devalue the customer experience.

5. Creating an Online Starbucks Community Network at MyStarbucksIdea.com.

This is the first idea that has some potential of customer experience improvement. I think I’m worried that the focus of the new online social network is about getting ideas from customers. This is a subscription to the new media myth that customers own the brand and not you. That somehow, customers will solve the problems you cannot. You can get some good individual ideas from customers, but mostly the wisdom of crowds is flawed.

6. An expanded relationship with Conservation International and an increased emphasis on ethically sourced coffee.

Maybe the most customer experience-focused initiative of those announced at the meeting. People like to feel good about making a difference. If Starbucks can prove that paying $4 for a cup of coffee also helps improve the world, it will add some warm-fuzziness to the experience. This is the most encouraging customer experience news to come out of yesterday’s meeting.

IN-STORE EXPERIENCE

Overall, the announced initiatives lacked impact on the in-store Starbucks experience. The product improvement announcements are nice, but never try to replace the customer experience with superior product.

If Six Flags theme parks announced an across the board improvement in roller coaster quality, most people would still rather go to Disney World.

Maybe there are customer experience enhancements that were not announced to shareholders yesterday. Investors don’t usually understand the customer experience-stock price connection. It’s great that Starbucks is improving product, but here’s hoping Howard has more up his sleeve.
What do you think? Am I being too stubborn?

Other bloggers are sounding off on the change (mainly mystarbucksidea.com):
Starbucks refocus by Paul Herring of Chaos Scenario
John Moore continues his thoughts with My Starbucks Idea
Starbucks Launches Its Version of Dell’s Ideastorm by Mack Collier on Marketing Profs
Starbucks adopts IdeaStorm concept by Shel Holtz
Nathania Johnson says The One Thing Starbucks Needs to Do to Win Back Customers
And speaking of Starbucks…. from Mark Ramsey of Hear2.0
Starbucks Looking for Ideas Via Social Networking from Kevin Maney of All Things Digital


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