Caffeine & So Much More

3:30 PM – My drug dealer is now pushing movies.

From this morning's Wall Street Journal, a note about Starbucks most recent promotional effort:
The chain will aggressively promote the film ["Akeelah and the Bee"], which is being distributed by the studio Lions Gate Entertainment, in its roughly 5,500 company-operated U.S. and Canadian stores, and will sell DVDs of the movie and CDs of its soundtrack in the U.S. In exchange, Starbucks will get an undisclosed share of the movie's box-office proceeds.

Starbucks is about real estate, merchandising, and retail. Coffee helps, too, but it's more of a convenient hook to keep us junkies coming back.

In the early 90s, before Starbucks went public, a district manager for the company dismissed the thought of Starbucks selling souvenirs in its shops, like other espresso stands around downtown Dallas. "If they were known for their coffee, they wouldn't need to sell keychains," he told me.

It turns out Starbucks is the one that is borrowing from stores it helped crush. And 7-11 should be worried, as Starbuck's will add more foods, toiletries (organic soaps, dye-free shampoos, and whatnot), and magazines to its stores in the coming months. Following that will be more digital music miscellany, including a line of specially-branded portable satellite radios and accessories to promote its Starbucks Hear Music channel on XM. Finally, 2006 will end with the announcement of the 2007 Starbucks Pilot from Honda. This mocha-colored, hybrid vehicle will come with digital music and coffee mug storage galore. And it will dedicate some of its spacious interior to accomodate an "always on" hot, filter water tap for coffee on-the-go.

Okay, the above paragraph is purely in the realm of speculation. But it doesn't hurt to start thinking of Starbucks as a sort of Google (Nasdaq: GOOG) without the dark fiber hookup. Like Google and Wal-Mart, Starbucks is a network. And networks exist to bring people together... and to sell them stuff. For these new networks, no idea is too big and there can never be too many hooks into a consumer's life.

— Phil Harvey, Lightly Roasted Editor, Light Reading

Scott Raynovich 12/5/2012 | 4:09:33 AM
re: Caffeine & So Much More Phil, what you just describes already exists: It's called Whole Foods. You can shop for organic dairy-free milk and then sit down in the cafe and grab a Peet's coffee and eat some organic free-range Yakburger. I'm sure WiFi with downloadable movies is next. (Disclosure: I own the stock.)

also, have you noticed lately how Las Vegas is nothing more than a giant mall of trendy retail outlets all seated within each other? You have a Prada boutique inside a Starbucks inside a Wolfgang Puck's inside a W Hotel that's in a casino.

Who buys all that stuff?

Who even needs a home? Oh wait.. they try to sell you a condo too.

DCITDave 12/5/2012 | 4:09:32 AM
re: Caffeine & So Much More concert/event tickets -- another great business that Starbucks will probably get into by '07.

they could even use their market power to negotiate automatic purchases of premium blocks of tickets at big venues and resell at their shops, kiosks, web site, etc.

Michael Poole 12/5/2012 | 4:08:31 AM
re: Caffeine & So Much More Well, they've got to sell something. I had some of their "coffee" once, in Osaka, where I didn't think you could get bad coffee. Wrong! You can! talk about insipid, and it came in a paper cup, too. Coffee in a paper cup? How barbaric can you get?

I will say "Never again".

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