March 17, 2008

Jeff Leeds' article on Starbucks' music retailing ambitions, "Does This Latte Have a Funny Mainstream Taste to You?," says the coffee giant's admired role as a new-era music retailer has lost its luster. Originally a small sampling of handpicked unknowns, Starbucks' CD selection now stretches well into more mainstream fare. That has rankled some customers and, in the eyes of some, hurt the chain's credibility as a music retailer. In addition, the company has reportedly demanded lower wholesale costs and has reversed its policy of not returning product to labels.

Perhaps music tastemaker is not Starbucks' role. Its customers are far more mainstream than the discerning coffee lovers upon who Starbucks built its success. While the stores' atmosphere is more NPR than talk radio, people of all stripes are customers. To be honest, Starbucks probably lost tastemaker status as soon as began placing stores next to highway off-ramps. There's nothing discerning about being in the same lot as a Quiznos shop.

The problem, if there really is a problem, is similar to Starbucks' larger challenge of growing the business while retaining its core strengths and brand image. In January, the company announced plans to scale back new store openings. It also announced it was dropping some food items from its menu. Not only were the food items not terribly popular (or good, according to many accounts), the company was worried the smell of the breakfast sandwiches were overpowering the stores' coffee aroma.

When Starbucks gets its groove back, it may carry more weight as a music retailer. That's possible. In the meantime, few labels are going to turn away placement in those thousands of locations.

AddThis Social Bookmark Button
Posted by Glenn at 12:48 PM | |