Bitter Beans Make Smooth Coffee

Let’s say I open up a small coffee shop. I have world class baristas, the best beans and machines money can buy, and we make utterly killer coffee. Business is slow but good. But then a new neighbour moves in and starts competing. It’s not Starbucks, it’s a McDonalds “Bistro” franchise. They sell something they call espresso, and make all the fancy drinks in addition to the usual McD’s fare.

Obviously they are doing so because they’ve seen that my business is making money, and they want a slice of that pie. They have a huge customer base and massive presence. People will flock to them because of that. People will drink their brown swill and think it’s proper coffee. Worse, people that might be future customers of mine might taste that swill first, and improperly think that all espresso tastes like swill. I might lose a customer that should have been mine.

Some people think I should react to this by immediately demanding that McD’s stop serving espresso. Or stop calling it espresso. At the very least, they should have asked me how to make it properly first. Frankly, they are insulting me personally by not having consulted me first. And obviously they are being evil by using their size and power to steal my customers. I should be outraged. Tehy even have the effrontery to call their staff “Baristas!”

On the other hand: I have ten customers. McD’s has one hundred. My customers can’t stand anything at McD’s and will never buy anything there. Some of my occasional customers might go to McD’s instead because of popularity or perceived convenience. I will lose those one or two people. But…McD’s is introducing a new flavour to one hundred people.  One hundred people that have never tasted espresso before are now trying it. None of those one hundred people would have ever set foot in my coffee shop before. Now they are trying something brand new. Some of them might hate it, but I know most of them will like it. It’s espresso. Everyone loves espresso!

Since I am a good business man, I know something. I know that my product is better than McD’s. Far, far better. And I know now that those one hundred people are tasting that product for the first time, some of them are going to want to try a real espresso. And wouldn’t you know it…here I am, right next door.

Except that I’ve followed the advice of my friends, and my front window has a huge sign saying “McDonalds is EVIL! Don’t settle for their SWILL! You are being stupid sheep! Come and drink the real thing here!” Now that I’ve insulted them, well, maybe one or two will come in anyway. When they come in, they see the existing customers yelling loudly at each other about how terrible every other coffee shop in town is. Or about how only one or two baristas are any good, and the rest suck and should go and die somewhere. The one guy that doesn’t turn right around makes it almost all the way to the counter before he looks up at the menu…which has been scribbled on in an illegible mess with fifteen different writing tools…crayons, fingerpaints, pen, charcoal, something suspiciously brown and chunky…and a few lines in the most beautiful calligraphy. Madness. Out he goes. Coffee people are weird.

But maybe…maybe I did something different. Maybe I looked at those one hundred customers and thought…they could be mine. If they come for the espresso, I’m what they really want. They just don’t know that yet. How do I make them know that? And they obviously like McD’s, what can I do that McD’s is doing? How do I make it easy for them to become my customers?

So I hit the library. I read everything written about the McD’s business model. Wow…lots of information. It’s so easy to find. All of their strategies are public and well documented. And hey, a lot of them apply to me! They chose well-trafficked locations first. That tells me that I’m in a good spot, and should probably be taking better advantage of that. Maybe some better signs, done by a real artist. McD’s is convenient, you can get food as well as coffee. I can’t serve big meals, but maybe I can talk to a local baker and get some really tasty muffins or other snacks delivered every day so people can get food, too. McD’s is fast. I’ll go in a buy a meal or two, and see what they do that I can do. They’re cheap, too…When I think about, I don’t want to compete on that level. On that point, some people will always go for cheap. Some people feel better when they spend a little more money. I don’t really need one hundred customers, another twenty would be enough for me to retire early.

And then I make some changes in the shop. I add some nice music, better decor. I tell the loudmouths to shut the hell up. Maybe I have to kick one or two of them out. I’m down two of my precious customers now, but more come in. I help things out by offering free samples sometimes. I make the shop as inviting and friendly as possible. I put up signs outside that talk about how good our coffee is, where it comes from and how it tastes. I list the awards our barista’s have won. I do everything I can to make my shop friendly, accessible, and desirable. I go from ten customers to twenty. I start to think about opening a second shop.

Meanwhile, a block away, the other coffee shop has my old customers in it, and they all loudly proclaim that I’m a sell out who has watered down the coffee experience for a few bucks…but my espresso is still the best in town. I didn’t sell out at all, I just cleaned up my act a little. I listened to what my customers and potential customers really wanted, and stopped assuming I knew. Anyone can do it and be just as successful, but they’d rather wallow in their misery…sorry, I meant purity.

You have to make the choice. Two clear options ahead of you. The loud and vocal opinion is the uproar of anger. You will find nothing but support down that path. Going the other way is a choice you have to make on your own, quietly, with no support. And you will be castigated for it. You might even be hated for it. But once you start down that path, you might just find you aren’t alone.

9 Comments

  1. Awesome post. I like the way you think about… Espresso.

  2. You know I struggled to find ways to describe what I was seeing in the espresso market and you just keep delivering the perfect words. I must say I like the taste of your coffee!

  3. Pingback: Much Ado about Bugger All | Ragion de Spada

  4. Except bigger business often doesn’t work like that. Instead it involves demands on partners to not sell to competition, buying up smaller companies, beer brands paying for all the furniture of pubs with the requirement that they only sell their brand, launching big marketing campaigns that while not outright lie, make claims that are misleading etc.

    Business is often not about making the best product. It is about reaching out the farthest with as little competition as possible.

    Making comparisons like this is tricky though, because we aren’t really talking about espresso. 🙂

  5. I think the comparison that is being made is at least as valid as comparing the USFCA (or even the AAI) to big-brand monopolies.

    • Fair enough on that point Dustin. I really think neither comparisons can be made and I wasn’t actually comparing USFCA to “big business”. I was comparing the theoretical Espresso businesses. Like I said; Making comparisons like this is tricky…

  6. Thanks. As a circus performer, this post works really well as an analogy for Cirque du Soliel and the rest of the Contemporary Circus movement.

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