alex bitterman design.intelligence
this is alex's online home for design-oriented stuff.Archive for Consumerism
Air France
Again, I find myself preaching about airlines! It is simply an outrage that more progress hasn’t been made on the Air France flight 447 disaster. For all we know—people and goddamnit a fucking plane—could still be floating around in the Atlantic somewhere. When I watch the film Titanic, I’m fascinated at how this huge ship could break apart in the ocean. I’m more fascinated that considering that it happened nearly 100 years ago, that the emergency rescue effort was so swift.
How far we’ve come in that hundred years, cell phones, the internet, television, radio, satellites, GPS, Facebook, Twitter, I mean, we are one wired and wireless world. It’s just amazing.
It’s eerily uncanny to me that allegedly, this plane failed and broke up. Therefore, we can assume everyone is dead. Hello? Is everyone INSANE?! Here we have a multimillion dollar/pound/euro piece of machinery. It’s a machine. Machines break, but until we know exactly what happened, we have to assume the best, and not believe the bullshit that some automated computer radioed back to Air France headquarters when no one was looking, or more precisely, when no one really cared. That’s what our grandparents generation would have called “asleep at the switch.” Who knows, maybe the plane did go down, maybe there are survivors, we shouldn’t draw hasty conclusions because of some automated messages that a broken machine sent forward.
I hate flying across the Atlantic. Flying to Europe always happens at night, and when you glance out the window, it’s a dark, cold abyss outside the window. On my trans-Atlantic flights, I often daydream about the horrific “what if” the plane went down? We’d be drifting in the Atlantic, in little yellow life vest, panickedly blowing into the little red tubes on the shoulder, grasping to our seat cushions for safety… if we were smart enough to take them along (you too may have observed that no one on the ill-fated US Airways flight that ditched in the Hudson did)… all this while some techno-savvy controller in some far-away operations center finds our exact location using sophisticated technology that tracks their multimillion dollar piece of equipment, whilst every seafaring vessel in the area makes great haste to get to us survivors before we die of hypothermia. All very Titanic-like.
Only wait… it’s been almost a week. Only 6 ships have made it out to sea to look for our fellow Air France passengers. It’s taken them a long time to get there. There isn’t any controller in a sophisticated operations center, and there is no technology that can track an exact location. Though the technology exists (it’s in my cell phone, my iPod, and my GPS) no one has yet mandated that it be installed in aircraft. Critics claim that the costs are too high. Well I can certainly underst… Excuse me? How high can the fucking cost be? If every aircraft worth it’s salt can pipe in live tv, streaming internet, and phone why the hell can’t it broadcast a telemetric info beacon every few seconds.
beep.
beep.
it’d take less bandwidth than that.
It’s positively shameful that multibillion dollar corporations can invest tens of millions of dollars to research and develop lightweight pallets for cargo transport, but can’t invest a couple thousand to install a GPS device for each plane. So what if no one has yet told them to do it. It’s unconscionable that any airline CEO or COO can sleep knowing that he has made the choice to profit from our peril.
Again folks: I urge you. Vote with your wallet. Demand that airlines consider our safety first. It’s your life, and you only get one of them. Don’t trust it to some corporate profiteer.
Why does Starbucks have to suck so badly lately?
I’m both fascinated and repulsed by corporate culture. I understand the damage that large corporations like Starbucks and Wal*Mart do to the economy and to any local urban fabric, but it’s amazing to me how companies can brand commodity products and experiences, and compel people to buy things that they probably otherwise wouldn’t. So, while I’ve never set foot inside of a Wal*Mart, I do go to Starbuck’s rather regularly, well until recently.
See, this is what becomes interesting, the reason a company can compel people to buy things is because they spend a lot of money branding the product and the environment in which it’s purchased, and in so doing tell a story—a fictitious story—that makes us, as consumers, want to buy something.
Many years ago, I worked at the Gap, and the company spent a huge amount of time training about the features and benefits of their jeans. This was shortly after the Gap (which made a fortune as the largest Levi’s outlet in the world) stopped selling Levi’s. Essentially, they had created a brand with greater equity than Levi’s, and the folks running the Gap (Mickey Drexler, at the time) made a shrewd decision to leverage the equity of the Gap brand name. So I went to endless training sessions to learn all the reasons Gap jeans were better than Levi’s, or Lee, or all the other brands that were out there.
So, long story short, one day, I was stocking jeans on the “floor” as it was called, and I noticed something very peculiar. The jeans looked like normal Gap jeans, they had a Gap label in them, but all the hardware—the little rivets and buttons, which usually was stamped with G A P—belonged to Perry Ellis, a fashion brand that by that time had slipped down the ranks past Lee and Wrangler, right to the bottom of the discount store heap.
Being the industrious young “pacesetter” I was, I bought a pair of the “mistruck” jeans ($29.50, minus my whopping 30% discount) and later that day wandered over to TJMaxx and bought a pair of bottom of the barrel Perry Ellis jeans for $8.99, no discount. In my bedroom, I unpackaged both, and was shocked to lear that the jeans were EXACTLY the same. My world was crushed. All the Gapropaganda that I had come to believe was now called in to question. We were essentially selling $9.00 jeans! It was unethical, but it was also the power of branding. People paid three times the price not because the jeans were any better, but because they believed they were better.
So, fast forward 20 years, I buy Starbucks coffee, not because it’s better, but because I believe it’s better. I’m a sucker for the brand, and I’m willing to pay because for the past 10 years, Starbucks’ service has been impeccable. However, once the economy started to tank, so did Starbucks’ service. I went in today to buy a decaf iced coffee, and was instead greeted by some song and dance about how they don’t brew decaf coffee anymore. I mean, really? Is it so hard to keep a pot of decaf brewing? Does that mean that because I don’t like caffeine, that I don’t like coffee? So, hey, Starbucks, if you’re listening, bring it on! We all know your coffee isn’t any better than the cut rate stuff I can buy at Aldi, so step up the service, and start giving your customers what they want…espresso, not excuses, and make that a decaf please.
US Scareways
They’ll only continue to be lax on safety if you continue to fly with them. Is a cheaper flight really worth it?
From 
Passengers report scare on earlier US Airways Flight 1549
By Abbie Boudreau and Scott Zamost
CNN Special Investigations Unit
(CNN) — Two days before US Airways Flight 1549 crashed into the Hudson River, passengers on the same route and same aircraft say they heard a series of loud bangs and the flight crew told them they could have to make an emergency landing, CNN has learned.
Steve Jeffrey of Charlotte, North Carolina, told CNN he was flying in first class Tuesday when, about 20 minutes into the flight, “it sounded like the wing was just snapping off.”
“The red lights started going on. A little pandemonium was going on,” Jeffrey recalled.
He said the incident occurred over Newark, New Jersey, soon after the plane — also flying as Flight 1549 — had taken off from LaGuardia Airport in New York.
“It seemed so loud, like luggage was hitting the side but times a thousand. It startled everyone on the plane,” Jeffrey said. “We started looking at each other. The stewardesses started running around. They made an announcement that ‘everyone heard the noise, we’re going to turn around and head back to LaGuardia and check out what happened.’
“I fly about 50 to 60 times per year, and I’ve never heard a noise so loud,” he said. “It wasn’t turbulence, it wasn’t luggage bouncing around. It was just completely like the engine was thrown against the side of the plane. It just — it didn’t shake the plane but it shook you out of the seat when you’re drifting off, it really woke you up. And when it happened again, everyone just started looking at each other and there was a quiet murmuring around the plane, and you could feel the tension rising just in looking.
“I remember turning to my [business] partner and saying, ‘I hope you got everything in order back home, life insurance and everything, because that didn’t sound good.’ “
Jeffrey said he sent a text message to his wife about a “scary, scary noise on the plane. Doesn’t sound right. They’re flying back to LaGuardia to check it out. I’ll call you when we land. I love you.”
He added, “About 10 minutes later when we never made the turn, we kept going, that’s when the pilot came on and explained — I wish I could remember the words — I remember him using air, compression and lock — I’m not sure the right order, but he made it sound like the air didn’t get to the engine and it stalled the engine out, which he said doesn’t happen all the time but it’s not abnormal.”
Expert Aviation Consulting, an Indianapolis, Indiana, private consulting firm that includes commercial airline pilots on its staff, said the plane that landed in the Hudson was the same one as Flight 1549 from LaGuardia two days earlier. See images from the rescue in last week’s crash »
“EAC confirms that US Airways ship number N106US flew on January 13, 2009, and January 15, 2009, with the same flight number of AWE 1549 from New York’s LaGuardia Airport to Charlotte Douglas [International] Airport in North Carolina,” Expert Aviation said in a statement to CNN.
The company said it checked with contacts in the aviation industry to confirm that it was the same plane.
The National Transportation Safety Board released the tail number of the downed Airbus A-320, which is N106US.
NTSB spokesman Peter Knudsen said as part of its investigation into the Hudson River crash, it will be looking at all maintenance activities, but has no indications of any anomalies or any malfunctions in the aircraft, so far in the investigation.
The Federal Aviation Administration referred CNN to US Airways.
US Airways would not confirm that the Flight 1549 that took off January 13 was the same plane that splashed into the Hudson two days later.
Valerie Wunder, a US Airways spokeswoman, said: “US Air is working with the National Transportation Safety Board in this investigation.” She would not comment on any other details, including Tuesday’s flight, though she did confirm US Airways is looking into it.
Jeffrey told CNN that US Airways earlier Monday confirmed to him that the Tuesday incident occurred aboard the plane that crashed.
John Hodock, another passenger on the Tuesday flight, said in an e-mail to CNN: “About 20 minutes after take-off, the plane had a series of compressor stalls on the right engine. There were several very loud bangs and fire coming out of the engine. The pilot at first told us that we were going to make an emergency landing, but after about five minutes, continued the flight to Charlotte.”
In an interview, Hodock said the pilot “got on the intercom and said they were going to have to make an emergency landing at the nearest airport. But then, only five to 10 minutes later, the pilot came back on and said it was a stalled compressor and they were going to continue to Charlotte.”
A third passenger, who did not want her named used, also said she heard a “loud banging sound” on the right side of the plane. She said she heard the pilot say the “compressor for the engine was stalled” and they needed “to turn around and go back.” However, she said, the problem was fixed and the flight continued without incident.
Pilots and aviation officials said that a compressor stall results from insufficient air getting into the engine and that multiple stalls could result in engine damage. However, the officials said, a momentary compressor stall may be less serious and could be corrected in flight by simply restarting the engine.
A bird strike could lead to a compressor stall, the officials said.
Design Loves a Depression
from
read the article online at: http://www.nytimes.com/2009/01/04/weekinreview/04cannell.html?partner=permalink&exprod=permalink
January 4, 2009
Design Loves a Depression
By MICHAEL CANNELL
Few of the arts benefited from the late economic boom more than design. After all, when the wealth is flowing, people don’t covet the concerts you see or the books you read. They covet the couch you bought, and then they buy a cooler one.
MODERN COMFORTS The Eames chair, left, is an enduring classic; the Vermelha chair, by the Campana Brothers, right, is in MoMA.
In the recent giddy years, signature architects and designers came to be known by their first names — Rem, Philippe, Zaha — and they were photographed as prolifically as Bono in new design hotbeds like Miami and Dubai. Brooklyn designers became the apotheosis of indie cool (thin portfolios notwithstanding), and the British collective Established & Sons and other skilled maneuverers learned to breed their self-conscious furniture selectively into limited editions that sold for the kind of prices more often found in the art world. All of which was chronicled in self-celebratory books like “S, M, L, XL” by Rem Koolhaas, a 1,300-page monograph as lush as glazed fruit and weighty as firewood.
Looking back, those of us with front-row seats might have known that this design surge would not sustain itself. Two years ago, at the Milan furniture fair, Marcel Wanders, a Dutch designer known for arty provocations, held a thumping party to show off his 15-foot-high lamps and other furniture of distorted Alice-in-Wonderland scale. Never mind that his work was upstaged by his girlfriend, Nanine Linning, who hung upside down half-naked while mixing vodka drinks from bottles affixed to a chandelier. Form followed frivolity. Function was left off the guest list.
Now, given that all those slick Miami condos are sitting empty in the sky, designers like the Campana Brothers, with their $8,910 Corallo chair, and Hella Jongerius, with her $10,615 Ponder sofa, might have a harder time selling their wares. Already designers are biting their knuckles over the damage reports. The American Institute of Architects reported that last month’s billings index, a gauge of nonresidential construction, reached its lowest level since it began collecting data in 1995.
The pain of layoffs notwithstanding, the design world could stand to come down a notch or two — and might actually find a new sense of relevance in the process. That was the case during the Great Depression, when an early wave of modernism flourished in the United States, partly because it efficiently addressed the middle-class need for a pared-down life without servants and other Victorian trappings.
“American designers took the Depression as a call to arms,” said Kristina Wilson, author of “Livable Modernism: Interior Decorating and Design During the Great Depression” and an assistant professor of art history at Clark University. “It was a chance to make good on the Modernist promise to make affordable, intelligent design for a broad audience.”
The most popular American designer of that era was probably Russel Wright, who acted as the Depression’s Martha Stewart, turning out a warmed-up, affordable version of European modern furniture, tableware and linens for a new kind of informal home life. A bentwood armchair cost $19.95. “They were not just cheap, they were beautiful, and that was a powerful combination,” Ms. Wilson said.
Design tends to thrive in hard times. In the scarcity of the 1940s, Charles and Ray Eames produced furniture and other products of enduring appeal from cheap materials like plastic, resin and plywood, and Italian design flowered in the aftermath of World War II.
Will today’s designers rise to the occasion? “What designers do really well is work within constraints, work with what they have,” said Paola Antonelli, senior curator of architecture and design at the Museum of Modern Art. “This might be the time when designers can really do their job, and do it in a humanistic spirit.”
In the lean years ahead, “there will be less design, but much better design,” Ms. Antonelli predicted.
There is a reason she and others are optimistic: however dark the economic picture, it will most likely cause designers to shift their attention from consumer products to the more pressing needs of infrastructure, housing, city planning, transit and energy. Designers are good at coming up with new ways of looking at complex problems, and if President-elect Barack Obama delivers anything like a W.P.A, we could be “standing on the brink of one of the most productive periods of design ever,” said Reed Kroloff, director of Cranbrook Academy of Art.
On the other hand, the design community talked up its role in safeguarding the world after 9/11, with little result.
Modernism’s great ambition was to democratize design. Ikea and Target have shown that the battle for cheap design can be won. The emphasis will most likely shift to greater quality at affordable prices. This time around it will be the designer’s job to discourage consumers from regarding that $30 Ikea side table as a throwaway item.
If household furnishings are to avoid landfills, says Julie Lasky, editor in chief of I.D. magazine, they must be capable of withstanding the vicissitudes of fashion — like the Aalto stool, but at a fifth of the price. “It will be about finding the sweet spot between affordability and durability,” Ms. Lasky said. This kind of innovation means rethinking the economy of production and distribution so that goods are made cheaply closer to home (or in the home, if the most radical ideas are to be taken seriously).
One way or another, design will focus less on styling consumer objects with laser-cut patterns and colored resin and more on the intelligent reworking of current conditions. Expect to hear a lot more about open-source design, and cradle-to-cradle, a concept developed by William McDonough and Michael Braungart that calls for cars, packaging and other everyday objects to be designed specifically for recycling so that their parts and materials are used and reused without waste.
The old paradigm — epitomized by shelter magazines like Architectural Digest and Dwell — that found romance in single-family homes, each with its own lawn, detached garage and septic system, may crumble under the weight of its wastefulness. One challenge will be for designers to coax us to a more efficient way of living, as the architect Lorcan O’Herlihy is doing with his light and airy schemes for multifamily dwellings in Los Angeles, a city where backyards and driveways are all but a birthright. Fewer buildings will go up, and the stock of mid-century buildings nearing the end of their lifespan will be thoughtfully reworked to make them efficient and in keeping with principles of sustainability.
If Ms. Linning’s dangling from the ceiling was a cultural moment now passed, we can look forward to others for an age in which beauty and austerity go together.
Michael Cannell is a former editor of the House & Home section of The Times and founder of thedesignvote.com.
Europeanization of Major U.S. Brands
Undoubtedly, the graphic design of consumer product packaging in Europe is more sophisticated that similar products in the United States. I’m not exactly sure why, but often European brands adhere to modernist design principles, and as such, packages and labels reflect a less-is-more aesthetic. American counterparts are often festooned with wanton drop shadows and visual textures which most certainly evoke a more emotional than rational purchasing choice. The more matter-of-fact mode of visual communication favored by European brands seems to be influencing some major U.S. brands. Tropicana quietly relaunched their line of orange juice in the U.S. last week, and the redesign is significantly more Euro in terms of style than the well-established U.S. counterpart. Tropicana has even harmonized the names of its line—renaming “Grovestand” (again, a folksy, homespun, quintessential American moniker) to “High Pulp” (which is a significantly more British-style mode of description)—with international counterparts.
Perhaps this is only the tip of the iceberg, and maybe, just maybe, we’ll begin to see some truly functional and well-designed consumer product and food packaging, rather than decorative visual noise that simply panders to masses of overstimulated and bored American consumers.
11
A couple of my (very awesome) students from RIT have been busy working to launch a new magazine. It has a digital home and a Facebook page so check it out: [11]
I’m a PC… only, I’m a hypocrite.
From a marketing perspective, the Windows “I’m a PC” campaign is genius (it’s just too bad they’re hawking software that doesn’t work so well.
Only one big problem with that spot…it was made using a Mac. [read entire post here] [check out the screen shots at Flickr]
Um. Hi.
Have you ever watched I Love Lucy?
Sometimes when Lucy wanted her way, she’d create a situation that would in turn create the need for whatever she wanted to do. Inevitably, it would backfire, we’d all have a good laugh and move on.
When I was in my first year of architecture school, I had just left a stellar architecture prep program at the GSD at Harvard where neither money nor budget were much of an issue for anyone. I arrived at the State University at Buffalo (which, for the record, is a fine architecture school, and has over the years, hosted more than a few Harvard faculty as “visitors” in its ranks) and as a newly minted GA, the chair of the department (who for reasons you’ll read in a moment, will remain nameless) told me: “Rest up. We have a big day tomorrow. Come prepared.”
I had no idea what he was talking about, until I arrived the next day to find him on the 3rd floor of the studio building throwing furniture — throwing all the furniture — out of the window, literally. At the time, I thought he was crazy anyhow (I’ve since realized that he’s quite intelligent), and thought that like many things in architecture school, this was just another highly peculiar thing to get used to.
I asked him what the big idea was, and he explained. In a state school there is, practically speaking, no budget for, well, anything. In order to “get” anything (like new furniture), you had to create an emergency — because in an emergency, things happened quickly, and you always got what you needed/wanted. He was right, in less than a week, the university had purchased and delivered all new (very nice) furniture for the studios. In my own mind, I always thought of this crazy way of business as “the Lucy Scheme” — you create an emergency or diversion, and you get what you want.
A good idea for someone like me (a Leo); create an emergency and you get your way. Hmm.
A few years later, I was immersed in researching my dissertation, and I received a review copy of a book in the mail that changed my life. The Shock Doctrine was the Lucy Scheme writ grand. Imagine that instead of a henna-head schemer, or a crazy/genius departmental chair, the schemer is a government. The book was — no pun intended — shocking. Chapter by chapter, Klein outlines one government scheme after another — often in the wake of a natural, political, or military disaster — to economically rape a targeted population. [if you're too lazy or "busy" to read the damn book, at least read the summaries here] or if you’re even too lazy or “really busy” to do that then watch this:
OK. Thanks for doing that. By now you’re thinking, she’s really liberal… very left. I believe, rather, she’s very right. She understands and was able to articulate that governments are good at making emergencies to get what they want.
Think about this: Since the Bush administration has taken office, we’ve spent nearly $1,000,000,000,000 on a war in a country the size of California. In so doing, we’ve ruined their economy, killed upwards of 500,000 (over 1,000,000 by some estimates) of their citizens, and thrown our own country into a financial tailspin (more on that later). Not to mention how many of our own citizens have died as soldiers in that war — and not to mention all of the private soldiers (that aren’t even counted) that our country has hired to fight for us.
The resultant financial meltdown that has been occurring piecemeal over the past month is an economic apocalypse. It’s the financial doomsday that forecasters have been forecasting for decades. It’s here. Now, and shockingly it’s an “emergency” — no one saw it coming.
Consider that the AIG failure is a financial disaster 10x the size of Enron — that to it’s point in history was the largest bankruptcy on record. Enron’s failure has been eclipsed 6 times in 6 weeks by (cumulatively) more than 100x. Oh my. Someone has to do something and quick! It’s a financial EMERGENCY! Oh no.
Slowly, the government is taking control. They have implemented the shock doctrine. The U.S. Government now owns one of the largest insurance companies in the country and the 18th largest in the world, backs most U.S. held mortgages (meaning it owns a larger percentage of homes than anyone or any entity in this — or any other — country), and is about to “bail out” most any bank that needs it. This bail out will essentially mean that the government will control most every bank or financial services corporation in the country by one degree of separation or less.
On Thursday of this week, the US government forced the Federal Reserve Bank — in conjunction with the Bank of England, the Bank of Canada, the European Common Bank, the Swiss National Bank, and the Bank of Japan — to flood the markets with cash to prevent a further financial meltdown [read it here]. Apparently, the situation must be beyond emergency if the bureaucracies that controls the most powerful national and international banks in the world moved within hours to coordinate and react to the melting U.S. economy. In addition, there must have been a substantial threat to their economies as well. Act now, think later (kind of like buying stuff from an infomercial late at night, always seems like a good idea at the time…)
After being briefed on the economic situation earlier today, Chair of the Senate Committee on Banking, Housing, and Urban Affairs, Chris Dodd (D) CT, said the U.S. is “days away from a complete meltdown of our financial system” [read it here] and that after he was briefed (along with other very senior leaders, including Bush) that it was like “someone sucked all the air from the room.”
Things are bad, or so it seems.
Actually, things will get worse. Much worse. What next? Where does the government draw the line on bailing out corporations? Why is it acceptable to bail out AIG, but not pour money into education or health care? Why is it that when someone can’t afford cancer treatment, education, retirement, or a first home, that the government doesn’t step in to bail the average citizen out? Why are corporations different? In the meanwhile, American automobile giants are lining up for their share, and I’d argue that the airlines aren’t far behind, as consumers grow more and more fearful, will retail and service sectors be far behind that? When, where, and why will it end, and where’s the line for me to get into?
Why is all this happening now? Why has no one connected the dots? Who’s to blame? Why are things happening so quickly? Why do big deals and mergers (like Lehman Brothers, AIG, and Bear Stearns) always happen on the weekends when everyone is occupied with Project Runway or football? Who is making these decisions if the Chair of the Senate banking committee doesn’t even know what’s going on?
Compound that with the fact that both Dodd and Bush today said (almost exactly and nearly at the same time) that the “time for finding blame will come, but the time for solutions is now.” Oh really? Act now, think later.
Could it be possible that this situation has been engineered? Is it a coincidence that oil has quadrupled since Bush took power in 2000? Isn’t it odd that this happened and he’s a former oil man? Isn’t it peculiar to anyone that the major oil companies have made record profits because of the higher oil prices… which means, that they are simply charging more to make more profit?
Just like with big oil, someone — and some corporations — are going to make millions if not billions or trillions from this current financial mess, and the average person, retiree, recent college graduate, and hard worker are going to lose. Meanwhile, we’ve reverted past the days of regulation to the days of government control of the economy (wait… wasn’t this why we fought the cold war?)
The tragedy of the situation isn’t the fact that it’s happening. It’s that it’s happening and no one cares. Nearly everyone I speak with is business as usual, most know “something happened with AIG” but don’t know much of the remaining story, or why the AIG collapse is of any importance. Most everyone I speak with is more concerned with more important things, like the football game this weekend, or that The Gap is offering 30% off of jeans this weekend, or the I Love Lucy marathon this weekend on TV Land.
Unfortunately, this time around, it’s no laughing matter. Engineered or not, the shock doctrine has arrived on your doorstep, kids, and this time, like every other time [read the book], it ain’t gonna be pretty.
Starbucks (as we know it) is dead.
I’ll be the first to say it, Starbucks is dead. Full disclosure: I’m a Starbucks shareholder — not because I believe in the company, or the way they do business, but because it’s going to be a rock solid investment. Going to be is the operative here.
Here’s why: I’ve spent years researching the life cycle of brands. Brands come, brands conquer, and brands go. It happens to all of them, and the one certainty of branding is simply that all brands eventually die — that doesn’t mean that they all go away the instant they die, many in fact are reincarnated (Salon Selectives) or resuscitated (Dove) or put on life support (Ovaltine). (My buddy Rob Walker recently wrote a stellar piece that appeared in the New York Times about old brands that have come back from the dead, click here to read it.) Some do, fortunately or unfortunately, die (Pan Am).
Retail brands are a slightly different breed. Typically retail “brands” are really just rehashed or extended corporate identities, which really aren’t brands… but for the sake of length, I’ll use the term brand to refer to any trade name or identity countenance.
Everyone from my next door neighbor to the folks at Pentagram [click here to read James Biber's Starbucks Redux] are talking about the unbelievably rapid demise of the Starbucks brand as we know it. As I was walking down Holland Park Avenue in London a few weeks ago with with my friend, design superstar and, brand afficianado Frank we were discussing how and why Starbucks tumbled so hard and so quickly. Everyone has an opinion as to why Starbucks is stumbling [click here Google "Starbucks Stumbling" and read News articles hearlding the demise of Starbucks], and the reasons vary wildly. For the record, I think that the new management at Starbucks has mad some serious missteps. I also believe that the economy is just rough overall. I believe there has been a change in consumption and buying habits that will likely be permanent (or at least long-term). I would guess that this is likely only the tip of the iceberg… but none of those things are the reason why Starbucks fell from grace so quickly: it’s karma.
Everyone knows that — love them or hate them — Starbucks was aggressive when it came to expansion. So much so that they actually started to canabilize their own chains (in fact, some claim, that’s how they knew that their expansion strategy was working: when sales from a newly opened Starbucks outlet started to dig in to the sales of an existing outlet.) Many mom-and-pop coffee shops really found it difficult to compete [click here for an interesting MSNBC article about how Starbucks actually forced its competition to be better competitors]. These aggressive expansion tactics caused many (or at least anyone with an ethical heart) to consider whether or not Starbucks was “good” or “evil.” The reality, is that deep down, most folks realized that Starbucks WAS evil and like many of its corporate cousins was actually damaging the urban and retail fabric of this country. The paradox, in my opinion, is that the coffee was just so damn good, that most folks were more than willing to overlook the fact that Starbucks essentially robbed South American and African coffee plantations, paying farmers fractions of a penny per kilo for coffee. Likewise, the coffee was so damn good that many folks were willing to overlook the fact that there was a Starbucks on every other street corner, and that many long-established mom and pop coffee shops went out of business as a result. The coffee was so damn good that many folks were willing to look the other way when Starbucks cut health benefits for its employees. The coffee was just so damn good that investors were induced to ignore unbelievably egotistical comments by Starbucks corporate leaders that mocked the competition and belittled the independents. (The list goes on and on and on.) The problem all along: the coffee ain’t really that damn good. It tastes burned (remember the first time you tried it?) And it’s expensive (nearly 6x more expensive than what you can brew at home.) And it’s really not convenient (yeah, you do stand in line 3x a day for more than 10 minutes.) The list… goes on and on.
So what it all boils down to is that the general public has snapped to attention as the economy has faltered, and realized what it’s really known all along: it’s not the coffee, stupid, it’s the brand. We’ve been buying a BRAND.
And thats where the trouble starts.
The Starbucks brand — as we currently know it — the green logo, the burned, but oddly addictive coffee, the earth-tone-y stores, the CDs and mugs, is dead. The folks at Pentagram (which, incidentally is arguably one of the top branding firms in the world) already know it.
This management team has made some serious missteps in managing (or arguably damaging) the Starbucks brand. Every time they tried to “make it better” they diluted the unbelievably strong brand equity a tiny bit. With every tiny erosion, the reality became infinitely more clear and as a result, the writing is certainly on the wall. As the brand juggled, folks realized: the coffee isn’t really all that special or different…the Made in China junk that’s for sale doesn’t set Starbucks apart from its competition…and the service sure isn’t anything to brag about. However, the Starbucks store environment… is, well, iconic. It’s the physical embodiment of the brand, and likely one of the main reasons people react so strongly to the Starbucks brand The Starbucks aesthetic is an emblem of allegiance, of belonging to a group of like-minded individuals. However (and here’s the sick irony), this same interior space that made the Starbucks brand what is was a year ago will soon be an endangered species. There will be 600 ready-to-go counterfeit/look-alike Starbucks shops across the country. See, Starbucks doesn’t own many of their shops, they lease the space, decorate it, brew some joe, and get to business. When they shutter a shop, they simply take the equipment and the beans and lock the door. The counters, the funny lighting, and sometimes even the furniture stays behind. Clearly, as Starbucks is in a bit of a financial pinch, (otherwise, they wouldn’t be shuttering 600 stores) which will likely require that Starbucks close the stores quickly and efficiently (if not hastily). That financial squeeze will almost certainly guarantee that the stores will simply be locked and left. Ready for any mom and pop to inhabit, brew some joe and get to business. It will look just like Starbucks, and act like Starbucks, but it won’t be. The fact that 10% of Starbucks outlets will likely continue to be coffee joints, that look, smell, and act like Starbucks will more than definitely dilute the Starbucks brand further.
Starbucks is confronted with a tough choice: change up the interior, or risk having a copycat on every corner (that ironically is of its own making). So a bad roll of the karma wheel for Starbucks, in that the very mom and pop organizations that they sought to put out of business will likely now inherit a ready-to-go Starbucks franchise without all the corporate strings attached.
Consumers will be confused.
Investors will be mad.
The Starbucks brand will be damaged.
Corporate heads will probably roll.
And then the air will clear (and here’s why it’s a good investment.) Consumers have a short memory, and before long many will be pining for a cup of Starbucks joe. The pendulum will swing, and again we’ll forget that Starbucks is a big, nasty corporation, or that its coffee tastes burned. By then, new management will lead a damaged but reinvigorated company in a new direction. Stores will be renovated, and a new logo will appear. People will claim the coffee is better than ever, and the company will gain steam, faster, and stronger than it had in this last run of 10 years.
Think that’s a pipe dream? Think again. Remember Apple in 1995? No one does. It was nearly bankrupt, and off most consumers radar. The heyday of the Apple IIe and Mac were over, and the machines were clunky, slow, and losing ground to the rapidly expanding Microsoft. Fast forward 10 years, and Mac is stronger than ever (literally), and the consumer perception of the Apple brand, however damaged, sheltered the company as it reinvented itself, and dusted the colored striped from its Rob Janoff-designed masterpiece logo, even as many apple-philes defected to Windows 95 and 98.
Starbucks will make it. It won’t be nice, and it won’t be pretty, but eventually the brand will emerge stronger than ever, and that makes SBUX a prime investment opportunity — but, for the long haul.
