Starbucks has a secret...

The coffee company is opening new stores. This alone isn't really newsworthy; there was a time when the java giant was opening stores at a rate so alarming it was difficult to imagine not getting a venti double-shot caramel machiatto anywhere in the world. But now, as with us all, the mermaid is feeling the recession.

Last July the sun set on numerous café locations around the country, leading to a lot of questions about the company's future. New competitors like McDonald's and old foes like Dunkin' Donuts were stepping up their game, and clamoring for Starbucks' generous market share. Additionally, cost-weary consumers with visions of "acting locally" saw $4 lattés as an expense they could easily cut from their budget without hurting their local economy.

Couple this downshift with the always-looming ghost of Starbucks' image problems as a soulless corporation, and the monlithic institution could quite easily find itself in trouble...Trouble that only careful rebranding could resolve.

And how has 'Bucks chosen to face that rebrand? A line of new stores, "inspired by" Starbucks but otherwise branded completely separately from the parent company. The new stealth stores are called 15th Avenue E.



The shops have a more mom-and-pop feel to them, promise more live music, poetry, and you know... coffeehouse stuff. A decidedly back-to-basics approach for the company.

I, for one, think it's a good thing. Starbucks began in this genre of customer experience, and by re-embracing it they can assert themselves as THE place to get a good cup of joe in a relaxed atmosphere. Enough with the sandwiches and CDs--just make me a respectable, hand-steamed cappuccino. Artisanal and crafty is the next big thing the mind of today's middle-class consumer, and by appearing to embody that image (and backing it up with a big budget) the green apron has a good shot at continuing its dominance in both the market and cultural landscape.

The Wolf in Googly Clothing.

Last week I talked a little about competition. The article focused on the subtle usage of attack ads, and the nature of going after the competition.

There are other ways, of course, to deal with your business competitors. Microsoft, in a bold gesture of "Can't-beat-'em? Join-em!" spirit, has decided to eschew competing with its rivals altogether and will instead now exclusively focus on imitating them. By mirroring the winning moves that challengers have made, ol' softy is hoping to win new customers and make over their image.

The primary disguise Microsoft is wearing is that of Google. I could go into how bing.com is rapidly becoming the butt of a grand Internet joke comparing it to the great Google-y moogly. I could mention that many consider the onomatopoeic name more likely an acronym for "But It's Not Google." Or I could just show you some logos...

Below are the logos for Windows 7 (the product that is supposed to redeem the Vista disaster) and Google Wave (the product that is supposed to forever change the way everyone communicates on the internet). I should note that the only photoshoppery performed below was comping the two logos together and resizing them; no color shifting was used, nor were the background or shadows affected.

A little healthy (and secret) competition

The very fulcrum on which the lever of capitalism lifts is competition. Without competition there is little financial incentive for innovation, fair pricing, or customer friendly business practice –without debate, all good things.

Competition also breeds another behavior in the american consumer space, that of negative advertising. It's rare in today's marketplace for one brand to strongly advertise against another. Subtle comparison, distracting wordplay, misdirection, and allusion are the order of the day. In spite of the active use of mudslinging in the political sector it is somehow considered uncouth in consumer advertising and outright inappropriate in B2B.

[A quick editorial aside: I personally don't understand this phenomenon at all. Ad execs often grow to loath their competition, and in private will endlessly rag on the "the other guy." The fact that there is any modicum of restraint or illusion of proper manners in their marketing initiatives boggles the mind.]

So when FedEx launched their new brownbailout.com website I was surprised. The site has the look and feel of a grassroots protest site, complete with loads of numbers, a "contact your senator" button, and way more informational content than you would usually find in a corporate microsite. All of this directed at calling out FedEx's biggest rival, UPS.

They even go so far as to parody UPS' whiteboard commercials (complete with shoddy wigsmanship and mom-safe Ben Gibbard-esqu soundtrack).



It's a bold move from FedEx, but don't think this means they've gone all rebel yell/fight the power on us yet. As far as I can tell they haven't done much advertising of this site, or of their political initiatives to resist UPS' lobbying. Keeping your negative ads on the downlow isn't exactly the same as never making them, but it's pretty close.

Check out brownbailout.com and form your own opinion on the matter. FedEx clearly cares enough about this cause to bring it to your attention (and to break from convention), but not enough to risk turning off customers in a very delicate race for power. Is that a risk you would take?

The king acts up again

I've spoken in the past about Burger King's raunchy-ish approach to advertising, but their newest ad takes the cake... or sandwich... or whatever:



The King has come to be known for pushing the boundaries of innuendo. Their "big bucking chicken" and "we're all full of sit" angus sandwich commercials used (semi)clever wordplay to get around modern draconian censorship laws.

But this, this is just a blowjob in hoagie clothing. I don't want to say i expected better from Burger King, because I don't really, but I still feel let down. The whole thing is cheap and gross. It surely doesn't inspire me to go eat 7 inches of processed meat food product.

The music industry, as virginal as ever

Last week saw the fall of a giant. The Union Square Virgin Megastore, the last holdout of the big record stores in New York City, closed its doors forever. The death throes of the British colossus sent tremors through the entire record industry, an entity long suffering depleted sales and maligned image.

I personally spent a lot of time in this store. In college I whiled away countless hours in the café reading comic books and not paying for anything. And that's the problem, really. Not simply that I was allowed to sit and read and not spend, but that I was ok with the whole consumption without purchase arrangement. Hell, I felt entitled to it.

I've purchased music from iTunes. I've bought hundreds of CDs. But for every dollar I've spent on legitimate music media, I've probably illegally downloaded ten dollars worth without batting an eye. I never thought twice about what I was doing. What's worse, when I sit down and think about it, all the music I've "stolen," I don't care at all, not one bit. And almost no one else I know does either.

And you know what? This is as it should be.

I'm not going to wave some fight-the-power, 2600, "the information wants to be free" flag. That would be asinine and wrongheaded. The movement for dramatically cheaper music (and, while we're on the topic, cinema and TV) is a step in the right direction for consumer and producer alike. At present only the consumers are seeing real benefit, but even now that's changing. In the future, the consumer-producer relationship will be much more mutually beneficial.

The history of music has been benchmarked not by new ways of delivering content, but by monetizing it. Paying performers to play in your ballroom, purchasing sheet music, picking up LPs at the five & dime, radio, payola, MTV… it's all been about salability. From promoting content to finding new ways to deliver it to the masses, much music technology innovation has sprung from a simple desire to move more units.

That is, until the Internet came along, with its promise of free and accessible media for all. We all know the story of the democratization of intellectual property: And Usenet begat Napster, and Napster begat BitTorrent, ad infinitum, ad nauseam. A sea change has taken place in the retail world, one that has re-aligned exactly what it is we purchase as a public, and what we consider worthy of purchase. The Internet has rather simply made the following rule: If it's an object that I can touch in the real world, it's going to have a cost attached. If it only exists as data, either in human memory or a computer's, it should be free.

But the internet has not made us into a culture of thieves; it just repositioned views on what should and should not be given away. Music, TV, newspapers, and film, we've decided, ought to be free (or extremely inexpensive). As producers increasingly come to terms with this we'll see them figure out new ways to get some return off us. The page is already starting to turn on the retail music industry...

Just last week Virgin announced it was launching an unlimited download music service in the UK. Right on the heels of its megastore close out. Will it have the clout to take on iTunes? Will it ever compare to the estimated $50 million annual profits that the now-deceased Times Square megastore pulled in? Only time will tell.

Pinging Bing: The new kids's pretty but what difference does it make?

Recently Microsoft launched it's new search engine,Bing.com. It's easy to say that Bing.com is a prettier search engine than plain old google. The large high-def photos (with fun-fact tags), the slick of-the-moment logo, an easy on the eyes grey background; Bing looks good. But does that really matter?

Google--really the only competition worth talking about--is famous for its oversimplified layout. There's an input field, two buttons, and a logo, and that's about it. Sometimes (if Google deems a holiday worthy enough) the multicolored letter logo is "enhanced" with what I can only hesitate to call pizazz.

This simplicity is emblematic of one of Google's core philosophies: easy-to-use products that work reliably. The great googley moogley doesn't want to bother you with a song and dance, it wants to get you to your search results RIGHT NOW. You don't have the time to be bothered, and the sooner you're clicking on links the more money Google's putting in its pocket. Google search is just a tool, the flagship product from a company that makes (internet) tools.

That said, there's nothing distracting or wasteful about Bing's looks. The aesthetics are interesting, but they don't serve as much of a speedbump. If you find yourself exploring or surfing around you're either remarkably easy to distract or you weren't super interested in your search query (quarry?) to begin with.

So why dress up your search page at all? And here is where I think Microsoft has taken some time to consider their tactics in the search-engine struggle. Sure, you want to define yourself as something other than Google. You can't simply imitate your competition whole cloth. But it's more than that. Google's homepage is easy to ignore. It drives you to the results, wasting no time on other content.

But if Google seeks to be a tool, then Bing seeks to be a destination. There's just slightly more motivation to spend a second on that homepage, and that second could some day be turned into dollars.

A subtle ad placement, an elegant sponsorship, even a cross-company promotion (quick jaunt on the X-box anyone?) gracefully implemented could spell a lot of clicks. Google would never be so garish as to clutter up their virginal homepage, but that's because it would be a galling distraction. Bing isn't subject to the same strictures.

Bing has left the door open on big-money anchor ads. A door none of its competitors had the chutzpah, or sense, or inclination to prepare for. We'll see in the next year if they exploit it.

Reading the future: Part 2 of 2

Last week in Part 1, I talked about the Espresso book machine: what it is, what it does, and its impact on the modern publishing industry. This week I'd like to suggest a new application for the Espresso that has the potential to dramatically change the print media landscape, as well as the nature of the user's relationship to the product.

The Espresso book machine is currently an awkwardly functional item. If you are looking for a rare or out-of-print book, it's invaluable. However, if you're shopping for anything else in the book store, as most customers are, the Espresso is little more than a grossly over-priced inkjet that can't really help you.

Outside of a perhaps woefully small niche, the book machine has little to offer in its current incarnation. But this is a first generation idea. Down the line, a few versions from now, if we're lucky, we'll see some innovative thinking. To see what is exciting in the future, though, I'm going to take a quick look back into the past.

Consider the Ford Model T. The automobile was priced way beyond the average consumer's means. It lacked the support infrastructure it really required for optimal usage. It even had trouble driving on America's mostly unpaved roads. With all those factors considered, the Model T was a difficult machine to own. That said, the Model T was the harbinger of great things to come. Ford sought to fill a need in the consumer landscape that most thought was (at best) a luxury, or (at worst) a dangerous fancy of the wealthy.

Ford filled this need with a complicated and innovative device, the bleeding edge of technology. In time, the little black buggy's descendants would become the most iconic of American tools, an irreplaceable device used everyday by most adult Americans.

The Espresso book machine has the potential to fill this same roll in our culture. By simply re-aligning the focus of the device, its usefulness to the average consumer is multiplied exponentially.

Imagine stepping into a book store, or a corner deli, or up to a sidewalk newsstand, and instead of grabbing a paper from the stack, you order one up built to your specifications. You don't read the Travel section because it gets you down every time you leaf through it, for example. Have no use for the classifieds right now? Wish you had some of your paper's online blog content in your print edition? With custom print-on-demand at point of sale you could add or subtract the sections of your choosing. Every customer could be the editor-in-chief of their own private international news organization.

For years newspapers have been wondering how they can stay ahead of the 24-hour news cycle curve that the internet created. Today newspapers are out of date by the time they arrive in a reader's hands. By printing at point of sale from a networked device, the content is live and updated until the very moment a customer purchases it.

Subscribing customers could be issued "smart swipe" (or RFID) cards that tell print-on-demand devices exactly which material to spit out. If you wanted to make a change to your daily read, you could update it online like your Netflix queue or your DVR program.

By synching with your RSS, reader the device could recognize which blogs you've already read in the day, and save paper by not printing duplicate information. Or, alternately, it could print out the comment threads those blogs generate during the day for your evening review.

...It sounds like a lot of wasted paper, though, doesn't it, printing out all those articles that you normally would just read on the screen? But consider in comparison the amount of unsold daily newspapers generated every day. By only printing the material consumers need we cut out an astounding quantity of unsold waste.

Printing on demand at the point of sale has other benefits. Costs to publishers are reduced even further by cutting out expensive shipping from the equation. Fewer trucks on the road means lower fuel emissions, something everyone can benefit from even if they never touch one of these devices.

By observing the content customers are purchasing and printing, advertisers can better tailor their messaging. If you're reading a host of content for new mothers, there's no sense in serving up ads for denture fixative. This level of demographic readership knowledge is the holy grail of print advertising. Couple real-time customer information with a google-esque pay-per-ad-served sales model and you've just re-engineered the newspaper business model into a streamlined modern engine.

This revolution need not be limited to the daily rags, magazines, comic books, trade publications could all benefit from this technology. Imagine the ability to purchase academic journals, which are traditionally only available by expensive subscription, for sale on any street corner at a fraction of the current price.

Complaining that internet technology is killing the publishing medium is like starving to death in a car because you didn't know how to turn the key and drive to the store. You have to leverage every tool available to you (and maybe invent some new ones) to stay ahead in the consumer market. Look at the things that aren't working, and figure out what good you CAN get out of them and what must be changed to make them work.

The only thing that beats "free" in the rock, paper, scissors game of capitalism is "convenient," and "convenient" is about the only thing the Espresso book machine has going for it right now. As it stands right now, the Espresso is not the device that can save print media, but it may be prophet for a better time coming. And after a few years of development, who knows?