I have talked about the commoditization of the coffee business before. You can certainly get a good cup of coffee (or name your favorite coffee drink) at many of the coffee houses that sprang up over the past decade. So, when “quality” is no longer the differentiator that it once was, what is a coffee house owner to do? Well, as many industries are discovering, you start focusing on differentiating through the consumer experience.
I visit Santa Cruz, CA occasionally on the weekend when I need a break from Silicon Valley. For those of you who have spent time there, you know what I mean. Each time I am in the area, I go out of my way to visit the Grinds Coffee & Tea House in Capitola. Sure, I could just as easily hit Starbucks. There are at least five in that area. But, I don’t. Why? Because I’m in Santa Cruz and Santa Cruz has a very specific culture and context.
Grinds is a Santa Cruz experience. It is a bit quirky with the bright green exterior, but very authentic, unique, and pleasant inside. It is a treat to go there and get whatever coffee you want made fresh by the cup. Grinds is a differentiated experience and it certainly fits the Santa Cruz context.
Yes, there are economies of scale in providing the same menu and even interior decorating when you are a global business. And, yes, you will attract customers who want “the comfort of the same.” But, increasingly, consumers are starting to tire of the McDonald’s-Walmart-Starbucks effect and want to experience something unique, something new, something with “local flavor.” Sites like Etsy are yet more proof that the pendulum is starting to swing back.