When challenger becomes status quo: How to recaffeinate the Starbucks brand
by Hayley Berlent
If you've picked up a copy of Adam Morgan's "Eating the Big Fish," you're well aware of the term "challenger brand." As defined by Mr. Morgan, a challenger brand is "any new or existing brand that is not viewed as first in its category, possesses a viable alternative to the market leader, and has the ambition and creativity to change the game."
So what happens when brands like Starbucks, Google and Apple, held up for so many years as the ultimate game-changers or "challengers," become the status quo? In this past Sunday's (3/13/11) edition of the New York Times, reporter Claire Cain Miller explores this very issue; examining how Starbucks, once the epitome of "innovation, the refusal to not be a champion" came to lose its "soul."
The article inspired me to think back to my first encounter with this now iconic, if decidedly un- "cool" brand. I remember very vividly finding myself in a Seattle Starbucks in the early '90s. There was an indescribable feeling that there was something special about this place. Granted, it was Seattle's heyday—with bands like Nirvana and Pearl Jam in their prime—and I was far more impressionable, but still, you couldn't get away from a feeling that there was a brand trying to turn the coffee industry, and marketplace in general, on its head. It wasn't just about coffee; it was all about the experience. Every time I ordered my Venti Skim Latte, I felt like I was declaring my identity to the world. Since that first trip to Seattle, I have remained a Starbucks customer, but increasingly less loyal and fanatical. In fact, when looking for an authentic coffee shop experience or even a decent cup of coffee, I'm far more likely to go out of my way or pay the extra dollar to visit a Café Grumpy or 71 Irving than I am at my local Starbucks. Starbucks, for me at least, has been relegated to an airport or drive-through pit stop. So how can Starbucks "recapture" its "challenger" spirit and its luster in the process? We'd recommend starting with three simple steps.
1. The "challenger" spirit cannot and should not live with one person alone
Starbucks. Apple. Google. Dell. All redefined their respective categories and the marketplace. All skyrocketed to success under their visionary leaders. All stumbled or stalled after their founders left or stepped back. It's no surprise then that Howard Schultz, Steve Jobs, Larry Page and Michael Dell have all been brought back to re-energize their respective brands. However, we believe this is a short-term strategy that is doomed to fail. For succession and, sustainability, it is an imperative that the "challenger" spirit be cultivated in every employee. In the case of Starbucks, that doesn't just mean closing stores nationwide for three hours of training. It means inspiring employees to not only embrace, but follow, the Starbucks mantra—every day.
2. "Challenger" brands are guided by a cause, not a value proposition
Cirque du Soleil. Virgin. Nike. All were founded and continue to live by a cause that transcends the boundaries of their categories, namely, performance art, air travel and athletic apparel. Cirque du Soleil for example does not define itself as a circus; instead it's a "multifaceted creative force" guided by eight characteristics, including daring, grace, dexterity and imaginary worlds. Perhaps Starbucks still embraces its mantra of "rewarding everyday moments," but, as a customer, it sure doesn't feel that way. To reconnect with internal and external audiences, Starbucks must redefine or reclaim its cause.
3. "Challenger”" is a state-of-mind, not a market position
Facebook may have world dominance with more than 500 million users and counting, but there is no question that, unlike MySpace and Friendster before it, it never settles. Instead, it continues to imagine, invent and improve as though it was still a scrappy start-up. Likewise, to stay fresh and relevant, Starbucks must continue to re-envision and re-invent the experience it delivers across all touchpoints.
I may no longer be a plaid-wearing-Starbucks-loving customer, but I welcome the day when I feel that same sense of excitement and energy when walking into Starbucks. Until then, I'll be drinking my coffee from Café Grumpy and watching with curiosity.
Hayley Berlent is a strategy director for the Siegel+Gale New York office.