Sunday, June 22, 2008

A Letter to Howard Schultz, CEO of Starbucks

I sent this to Starbuck's HQ last year. I got a very polite form letter from someone in PR.

Howard Schultz
2401 Utah Avenue South, Seattle, Washington 98134

Dear Howard,

As a Starbucks customer, I find myself planning to reduce my number of (numerous) visits, but as I have had hundreds of pleasant experiences and enjoyed many espresso cups over the years, I feel the need to tell you about my reasons, so that they might positively affect the company.

Just for background, I am in a demographic I heard disparagingly categorized as “cappuccino-drinking Volvo drivers”. Our family has two teen-age boys, and over the last 25 years I have been to Starbucks locations all over Canada, the US, and Japan, and spent thousands of dollars there. My formative coffee experiences included a visit to Italy in 1977, where after stumbling off the red-eye train from Roma to Firenze at 5:30 am Sunday morning, the train-station’s café was bustling, powered by a barista-owner with energy and a sense of humor inspiring to those of us dragging ourselves out of the train. She affectionately echoed our requests by ordering up “cappucio” – yes, without the “n”.

I brought back my love of the coffee and café culture, much as you did, but not being as entrepreneurial, had to seek out opportunities, nuggets like the Java Shoppe in Edmonton Alberta, where I learned the phrases “long-pull” and “short-pull” were literally about heaving the pressure arm on the Victorian-age steam-powered espresso maker. After that, you could find pockets of it in the folk-music-and-carrot-cake music clubs, like the one I went to “The Hovel” and first heard Leon Redbone.

But I ramble. If we had time, we would sit at a small table with an espresso and have a conversation, and I hoped to come close to it last month when you were in Vancouver for the 25th anniversary of the CPR terminal location. I was at that location earlier that day but could not stay for the event. Here’s what I would have said:

Number One: Bring back the coffee smell. Working as I do at a large corporation, I can almost hear your accounting firm point out the waste of money they saw in having open beans in drawers. Hard to account for; spoilage; mess; the occasional overage in filling up a customer’s bag; beans dropped, stepped on, kicked into corners, stuck in customers’ show treads, in the corner of the shelf. How much more efficient it would be to eliminate that mess, and just sell prepackaged beans. But what the shops have lost as a result of that is – serendipity, and aroma. The mix of wafts of beans, roasted and mixed, was for me like a bee drawn to a flower. I used to pop into a store, just for a whiff. But now, the coffee smell is missing,

Number Two: Bring back baristas. I imagine anyone can be taught to steam milk. You just read the temperature. But being able to measure, tamp, and pull a shot is a skill, a craft, perhaps an art. The auto-mech machines that are now sweeping the locations simply do not make as good coffee as the hand-made. I don’t even bother now getting espresso from shops that have those machines, and it’s getting hard to find a Starbucks without one. I am sure accounting has determined that the labour-cost per cup has now been reduced and can quantify the savings on the bottom line, but my dollar is going to disappear from the top-line. No company I am familiar with ever considers reduction in top-line revenue as a consequence of cost reduction, I believe because the cost-reducers do not understand the ephemeral elements of quality, and so ignore them when they are impacted by cost-cutting. It takes top-level leadership to avoid the erosion of these hard-to-quantify elements of brand equity, as you alluded to in your memo in February.

Now I realize that I am a coffee snob. I always knew that Starbucks’ ability to continue to attract me would be at odds with the mass-market, good-enough approach that seems to be the sweet spot for public companies. I can imagine that as a company, Starbucks believes that the mass market is key, and consistency is more important than uniqueness or high quality. Still, I am saddened at the prospect.

My coffee indulgence has been moving back to the smaller, unique coffee houses in Vancouver, like Take Five, and Café Artigiano, both run by Italian families, where each cup is a little work of art, and I can be re-instated in the coffee culture of Italy that I came to love as a young man.

May I finish with a sincere thanks for bringing the coffee house experience and a wish for good luck with Starbucks, Howard.

David Kauffman