Starbucks Missed the Boat?

Written by on August 3rd, 2008

About 6 years ago I sent an overnight letter to Starbucks headquarters suggesting they consider offering their customers a private, password protected online community to continue to build their brand, engage customers and gather more data about their customers.

At the time my firm provided online communities to groups and organizations in the higher education space and we were looking for a way to leverage our product in the commercial market.  The company executive I sent my letter to was preoccupied with other issues at the time and my subsequent follow up phone call was met with a response,  well – similar to what you’ve heard from time to time in your  career – don’t call us, we’ll call you!

Fast forward to 2008 and we see Starbucks coming out with what they call their new customer online community called   The community offers customers an opportunity to help direct where the company is going and is modeled after a number of successful examples including Dell’s  Community Forum and Salesforce’s Ideastorm.  

While I applaud Starbucks for adopting the beginnings of an Internet strategy, they are still missing the boat.  (A 15 BILLION dollar boat!)   Their so called online community does offer a two way conversation with their customer but it does not take the next step to be a community in the social/business networking sense. is really a tool to help their company develop a better product and customer experience. And it has.  The “discussion board” on steroids enabled 10,000 Starbucks fans to suggest they do something to plug the hole in lids to prevent their coffee from spilling.  Armed with data like this, Howard Schultz and his team are able to go to their vendors and partners and hand the problem to them to solve!   So is this online community?  Not the way I look at it.  At the end of the day this is an online suggestion box that is interactive!

So back to the letter…..

The letter I sent to Starbucks suggested they use our ( online community building tool to create give their customers the ability to connect with each other online and then to move those connections to the Starbucks of their choice. (Where they consume more Starbucks products)

In my mind there were three types of customers:

  1. Business and SOHO customers
  2. Stay at home parents
  3. Teens.

Many business and  SOHO customers look at Starbucks as another conference room and a place to meet people and do business.

  • So I thought, why not create a virtual business networking opportunity where individuals  who frequent that Starbucks find others to network and do business with.
  • Why not create a virtual Starbucks where stay at home moms and dads could connect based on interest, hobby or kids and move that burgeoning friendship to meeting where –  at the local Starbucks.
  • And of course why not create an environment where you can let kids meet  online and then hang out at Starbucks later.  (Ok, maybe that wasn’t such a good idea!)

Of course I wanted them to use our online community building tool to enable customers to post photos, share comments, build friend lists and engage in discussion boards.  The idea was built on the white label online community concept we started in 1995 which was inspired by the then giant online communities  AOL, GeoCities and Classmates.

The problem most online communities have is gaining the attention of the public.

At the time, I reasoned that Starbucks had a built in audience they could promote the online community to. I tried to find some relevant data on how many customers Starbucks serves in a day and only found a simple reply on Wikipedia that suggested they average 450 customer a day.  Based on 15,000 stores (again a best guess) that means they serve 6,000,000 customers in a day.   All they had to do is put the community link on every cup of coffee and they would have had a teeming community by now.

The point I’m driving at is this.

If Starbucks had moved in this direction in the early part of this decade, or at least by 2004, they could have a thriving online community that rivals Facebook and MySpace –  both worth billions of dollars. (It’s commonly quoted that Facebook has a 15 billion dollar valuation based on Microsofts  $254 million dollar investment for 1. 6 percent of the company)

Had Starbucks moved in this direction they could have had a new business division whose worth rivaled their parent company that had 15,000 stores and 170,000 employees.   (Facebook has 300-400 employees and one location)

If you are looking for a way to engage your customers in developing new products and services Dell, Salesforce and Starbucks customer feedback communities are great examples to copy.

However,  if you are an organization that serves hundreds, thousands or millions of people per day, it might make sense to build a white label online community to connect, engage and learn more about your customer.    You may, like Starbucks have a once in a lifetime opportunity to  build your own media property, like Facebook that could be worth 15 billion dollars some day!    Don’t let the boat leave the dock with out you!

What’s your opinion?  Did Starbucks miss the boat?

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