Starbucks on every corner!
Starbucks successfully opens and operates stores in sight of each other. Why don’t they cannibalize each others sales? Starbucks is in the demand generation business, they stimulate customer desire for quality coffee experiences. Many independents and small chains now open stores near a Starbucks location and if they are sufficiently differentiated and appealing, they can also thrive.
To thrive, the independent coffee house must focus on winning mindshare and not compete with Starbucks for market share. Winning mindshare is not about the coffee per se. It is about the entire customer experience and experiences are emotional. It is essential the coffee house know what its experience offers customers, how their experience differs from Starbucks and critically, what emotionally draws the customer into the experience.
They must be clear on their distinction. Starbucks is a modern, efficient coffee house with a few tables. Many successful independents thrive by cultivating the appeal of an authentic old, well establish coffee house. Plenty of tables and chairs that all appear like they have been around for decades. Nooks where coffee drinkers can privately work their laptops or larger table where a group can gather. Racks of newspapers on a stick to encourage you to spend sometime. If Starbucks signals fast-paced these independents encourage customers to slow-down. They appeal to different customers or to the same customer seeking a different experience.
Regardless of your business or industry, a clearly differentiated will reduce the need to compete on price.
