7/19/2005

Starbucks Proves to be Perfect Name: It Makes Stars and Bucks Remember the good old days, say hours ago, when you used to visit Starbucks just to buy an overpriced cup of joe? My, how times have changed. It's no longer a quick stop on the way somewhere, but a destination in and of itself. It's one of my favorite places to people-watch and I don't even drink coffee. Today, Starbucks is becoming known as much for its music as its latte. And in the process, it is making stars - and reviving careers - of musicians around the globe. In fact, some record producers now make decisions on whether to sign an artist based on the likelihood that Starbucks will back the venture. One of my favorite albums, Genius Loves Company, a disc of duets with Ray Charles and various artists, was produced and distributed by Starbucks. It went on to sell three million copies, a quarter of those at Starbucks stores. The store has been credited with bringing in as much as 50 percent of an album's weekly sales. Starbucks initially was a hit because of its universal appeal (the U in Spud) to coffee drinkers. Now it has transformed itself into "the third place" for people to invest their time, eclipsed only by home and work. In other words, Starbucks doesn't sell coffee so much as it sells a lifestyle. Company executives have been smart enough to understand that you can create your universe or follow one that is put in place by others. Trust me, leading is better than following. So far, Starbucks has done an amazing job of staying attuned to its customer base, but customer styles, tastes and trends change over the years. The company's longevity will be driven by its ability to adapt to those changes. That's true for all of us as well. Are you paying attention to shifting trends so you'll know what "the next big thing" is in your industry? Universal appeal requires that we constantly take the temperature of the marketplace and figure out where it's going even before it has gotten there. Universal appeal also means refusing to be myopic. Starbucks didn't see itself as just a gourmet coffee shop; rather, it created its own destiny as a favorite hang-out. It asked the simple question, "What would appeal to a very large group of people now and in the near future?" Maybe it's time for you to grab a brainstorming buddy, head to a local Starbucks (no directions needed - just start driving and you'll find one within 2 miles), and see what you can learn from the daily grind.

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