How Starbucks intends to “reclaim the ‘third place’”
Issue #272: born before SNL + the art of self-differentiation
In our issue on “third places” — venues for socializing apart from work and home — my colleague Carly Rose Gillis visited an American Legion Post. She wrote about why “third places” are so important: they help us connect with people who are different from us, but who live close by. The best ones level the socioeconomic playing field. You don’t need to buy something to feel like you belong. Parks and libraries are prime examples.
I thought back to that issue when I read about Starbucks’ new CEO, Brian Niccol, who recently told investors he wants to “reclaim the ‘third place’” and make the chain’s “cafes feel like welcoming coffeehouses.” For context, Starbucks is not doing very well. Shares dropped 22% last year, and sales are down. It’s had four CEOs since the pandemic. Now, it’s attempting a turnaround: “Back to Starbucks.”
Besides the fact that a corporate coffee purveyor can’t do what true third places do best — make people feel welcome regardless of income — the turnaround attempt is interesting to me. How does the world’s largest coffee chain (with over 40,000 locations globally) become “a community center” where each cup is, to quote Niccol, a “handcrafted moment, made with care”? How do you scale that vibe?
One tactic: giving away free coffee. Starbucks did this last Monday, post-Superbowl. Another: tackle the “four minute” problem, i.e. getting wait times down to four minutes or less, which Niccol seems fixated on. (You can’t create community if people are grumpy and undercaffeinated!) Starbucks also may have started a meme capitalizing on a long-beloved (and roasted) aspect of its brand: baristas who misspell customers’ names (possibly on purpose, maybe not). On TikTok, people are saying baristas have to write on the cups now, so they’re using them as canvases for Taylor Swift lyrics, memes, and the letter from The Notebook.
This attempt “bespoke” community-centrism reminds me of M.G. Siegler’s analysis of Barnes & Noble, which completed a similar turnaround over the last few years. “Scale is power,” Siegler writes, “but you need to obfuscate that from the customer when it comes to retail.” If you don’t, your product will feel soulless and customers will leave, which is exactly what’s happened to Starbucks over the last five years.
“Bespoke up front, scale in the back,” he concludes. “This sounds obvious, but the key to making this work is in the details” — which, depending on how you execute them, can feel either welcoming or inauthentic.
⚡ 3 more stories
- Will Leitch, born one day before SNL’s premier on October 11, 1975, celebrates his 50th birthday along with the show… and articulates its key lesson: “Just keep making stuff. Just keep doing it. It makes you irreplaceable. It makes you inevitable.”
- Morning TV host Jabari Thomas encourages his younger self to “build your own table” instead of asking for a seat at one that will never welcome you.
- Cartoonist Sarah Firth writes (and draws) wisdom for creatives who can’t stop comparing themselves to others: You’re doing it because you want a benchmark for progress in an inherently uncertain career.
⭐ Your daily dose of practical wisdom
People differentiate themselves in three ways: agency (doing what you want), taste (liking things before other people do), or how you combine disparate skills. (Dan Koe)
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Edited and produced by Scott Lamb & Carly Rose Gillis
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