Trouble in Coffeeland? Starbucks to Close 100 Stores

The notion of value in the hospitality industry is an intriguing one. Some people will pay what they believe a product is worth and nothing more. Others though, will pay far more. Why? Because they want to be socially accepted or feel like they’re part of the cognoscenti.

Consider the case of a cup of coffee at Starbucks. I paid $2.00 for a medium cup of coffee the other day. I believe they call it a “grande.” Was that cup worth two bucks? Absolutely not. So why did I fork over the money? Good question. I actually began to ponder that issue as I sipped the lukewarm Colombian dark.

Apparently, a few million other customers have begun to rethink the value of a Starbuck’s cup of java as well. Because sales at the nation’s leading coffee shop chain have begun to slide.

Now let me clarify: I do like Starbuck’s coffee. And I get a kind of God-bless-American-business feeling when I walk into one of their stores and see people hard at work on their laptops or conducting sales meetings or job interviews over a cop of jo. But I suspect the bloom may be beginning to come off the rose. Starbuck’s began a national mania for exotic coffee blends and mysterious drinks with names like “Mocachocalatte” And for a time, people were willing to pay a premium for the cachet that Starbuck’s offered.

But what goes up must come down. And Starbuck’s corporate has closed 100 stores and has begun experiments with value pricing. At some spots in the country, one can now get a cup of coffee for, drum roll please, a buck! They’ve named this “the short cup”. And it’s a stab at competing with bottom feeders McDonald’s and Dunkin’ Donuts. Well sign me up for a short cup. It’s probably not even worth a dollar but it’s a step in the right direction.

Now, the burning question is: if you only order a “short cup” the next time you go to Starbuck’s, will they still give you free wireless?