Five times unlucky for Espresso giant

May 21, 2012

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Interesting to see in this weekend’s business press that Starbucks UK seems to be in the proverbial ‘Doo-Doo’

Reporting its fifth consecutive year of losses, the business has blamed amongst other things ballooning high street rentals for its poor performance…

In summary – the chain closed 12 stores…opened a further 42 and refurbished 766 units… a busy year then! But losses were nearly £33m and believe it or not, the last year a profit was recorded was way back in the heady post brit pop days of 2006

And potentially, that little statement sums up the problem for Starbucks…no matter how many times they refresh their brand ID and fiddle with the roast and recipe and refurbish stores, there is now a fundamental miss fit between the fresh and exciting Starbucks which we fell in love with in the late nineties and consumer aspirations today

We have moved on… and Starbucks now seems a little out of time and place…a little crass and well sex in the city passé?

Activities such as introducing double shots, at no additional charge, in March of this year only exaggerate the clear water which now exists between Starbucks and its rivals such as the ubiquitous Costa and the premium Nero… simply how could they have waited so long to make this move?

And rather than an inspired ‘purple cow’ marketing activity, surely the giveaway of 350,000 lattes on the morning of 14th March smacks of desperation…despite a continued 9% increase in Latte sales…inevitably at the expense of cappuccino or moccha chocca frappe wappe…I jest but the point is made…

Rest assured in years to come Starbucks will be referenced as an ‘A’ level case study of a business which spectacularly lost its way!

This article was written by Guru (Andy Grelak) who writes for aromocoffee.co.uk, the UK’s leading online retailer of E.S.E espresso coffee pods  and Senseo coffee pods