Coffee and Charging

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Businessweek recently reported that Starbucks plans to install Duracell Powermats on its tables. The obvious reason behind this is for the coffee shop’s customers to charge their phones while they sip their drinks. This may seem as a simple innovation; some may even view it as no big deal. But, further scrutiny reveals that this new feature shows Starbucks’ commitment in sustaining and enhancing its value proposition.

To those unaware, a value proposition according to marketing guru Philip Kotler is “a set of benefits or values it promises to deliver to consumers to satisfy their needs.” In other words, a value proposition is the unique experience that the business promises to deliver to its customers or clients.

In the case of Starbucks, its value proposition lies in enhancing the customers’ experience while drinking coffee. This was no easy feat. In fact, one blogger named Ms. Lauren M. Jacobsen describes the effort that the company did to come up with a unique value proposition:

 

The value proposition of Starbucks focused on a brand strategy that was comprised of three components. The brand strategy was best captured by the phrase “live coffee.” This phrase reflected the importance of keeping the national coffee culture alive. From a retail perspective, this meant creating an “experience” that people would want to incorporate into their everyday lives. There were also three components to the branding strategy. The first component was simply the coffee. Starbucks offered the highest-quality coffee in the world and controlled much of the supply chain as possible to help insure that. Starbucks worked directly with growers to purchase green coffee beans, it oversaw the custom-roasting process, and it controlled distribution to retail stores around the world. The second brand component was service, or what was also referred to as “customer intimacy.” This included simple things such as remembering someone’s name or drink order. The third brand component was atmosphere. Starbucks stated that people came for the coffee but stayed for the atmosphere. Therefore it was important to provide a comfortable atmosphere that allowed a sense of community. [Emphasis mine] All of these things combined led to a compelling value proposition.

 

Now, with Starbucks installing phone-chargers on its tables, the company is staying true to its strategy of ensuring that customers experience a comfortable atmosphere while drinking their coffee. Clients and guests can leisurely sip their drinks while charging their phones. This is significant since people nowadays rely so much on their smartphones or mobile phones to conduct their businesses.  If customers can charge their phones in Starbucks, then they’ll have another reason patronize the company’s coffee shops.

The name of the game therefore is for businesses to continuously tweak their value propositions. This is important not only to fend off copycats but also to ensure that customers have new offerings or perks that they can experience. This in effect makes the company enticing and fresh in the eyes of consumers.

Businesses, therefore, have two choices. They can either create a unique, sustainable, and evolving value proposition as they go forward or take another path and remember their decision with a sigh.

 

*The image above comes from http://www.businessweek.com/articles/2013-07-26/starbucks-adds-phone-charging-stations-dot-whats-next-showers