The Coffee Is Brewing And So Is The Battle

It seems everyone wants a share of the gourmet coffee market these days. Dunkin’ Donuts, which has for years dominated the blue-collar coffee market, is planning to open 15,000 new stores by 2016 in an effort to attract the more upscale, white-collar market of Starbucks. Starting this year, all 14,000 of the McDonalds in the U.S. will install McCoffee bars with “baristas” that serve cappuccinos, lattes, mochas and the Frappe, similar to Starbucks’ ice-blended Frappuccino. Even Burger King is getting into the game with their Mocha BK JOE Iced Coffee.

On the Outer Banks of North Carolina, the coffee battle is approaching epic proportions. McDonalds and Burger King are offering their new brews, but more importantly the very first Starbucks and Dunkin’ Donuts just opened their doors, and an additional four Dunkin’ Donuts are underway. It has been interesting to see the reaction of the local coffee houses to these new competitors, both of whom have lower prices. The largest local operator, which has three stores on the northern beaches, repainted their menu boards without prices. When I recently asked the price of a particular espresso drink, the employee shrugged and said, “somewhere around $4.75,” adding that the prices could be found on the printed menus sitting next to the cash register. Yesterday I stopped at the same store and ordered a medium Americano – two shots of espresso watered down to coffee strength. The bill came to $2.75, yet the printed menu said the price was $2.55. When I questioned the charge, I was told that the printed menu were incorrect because “prices fluctuate according to the cost of coffee and milk.” The very same drink, purchased at the area’s new Starbucks that same morning, was $2.55.

A couple of days ago I stopped in the Outer Banks new Dunkin’ Donuts to try their coffee. I was not impressed. Not only is their coffee weak, the atmosphere was more akin to a fast food operation than a coffee shop. If they are indeed targeting Starbucks, as their public relations hype would have us believe, they have a long way to go.

I admit that my choice of coffee shops has more to do with environment than the quality of the coffee. Let me qualify that last statement. I must have a GOOD cup of coffee, but not necessarily an EXCELLENT cuppa. I will willingly sacrifice a touch of quality for a better environment with more amenities. I will also admit that I am spoiled by my current home town, Sarasota, Florida. I am a writer who prefers to work in public places like coffee shops. In Sarasota, I spend my days wandering between the three downtown coffee shops. In each, I can get a free WI-FI connection for my laptop, economical prices, and they allow me to “veg” for hours at a time. Plus, each of the coffee shops that I frequent allows me to plug in my laptop, rather than rely on a battery that has a limited charge. Not so at any of the ‘local’ Outer Banks coffee shops. For instance, the previously mentioned local operator makes WI-FI available, but access comes with an onerous set of rules. A prominently displayed sign reads as follows:

Wireless Etiquette

• Internet availability may be limited during peak morning hours
• There is no provision for plugging in – you must be self-powered
• If you must use your cell phone, please step outside
• All tables are shared with others – please do not spread out your stuff
• During peak times, please limit your time to 1/2 hour, as seating is limited
• Our staff is not the IT department – all we provide is a free connection with the Internet
• Respect any requests our staff makes of you
• Please remember – this is a coffee shop, not an office

Frankly, that all screams NO! NO! NO! to me. Their policy is so bad that they have actually been known to SHUT OFF the wireless for an hour or so in the late morning hours to get customers to leave.

Starbucks wouldn’t be caught dead with a sign like this in any of their cafes. In fact, their marketing philosophy is one of “third place” – they want you to think of their cafe as the third place – after home and office – where you feel most comfortable. When I visited the new Starbucks on the Outer Banks I noticed a strip of ten receptacles beneath a countertop, in front of which perched a row of high stools. When I asked if it would be OK to plug in my laptop and stay a while, the employees enthusiastically told me to plug in and stay as long as I liked!

Back home, at Sarasota News and Books customers are encouraged to stay for hours; it is not uncommon to find a dozen college students sitting in their coffee shop, laptops open, hard at work on term papers. The same holds true at the Starbucks in downtown Sarasota, as well as at Pastry Art, a local coffee and dessert shop on Main Street.

National chains are subject to much criticism because they tend to force the local operations out of business. Although I agree that there is some validity to this criticism (as in the case of WalMart, which has such immense buying power that they can force suppliers to sell products to them cheaper than they sell to the smaller operators), I also think that the national chains are often better at what they do. They have their fingers on the pulse of the consumer and understand what products and services are most important to their customers. If the mom and pop operations want to survive, they will have to find a way to do a better job than the national chain stores. That doesn’t necessarily mean offering lower prices. It may mean providing better service. Or enhancing their environment. Or even – perish the thought – abandoning the Land of NO and relocating to the land of WELCOME!