Back to Basics at the Bux

For my last blog entry of this semester, it is only appropriate for me to write about the company that I love so much and worked for over a 5 year span. Starbucks, in its efforts to get back to re-simplify its business model and get back to "the third place" under the direction of founder and the self re-appointed CEO Howard Schultz, has just announced a huge rollout of a new WiFi system in its partnership with AT&T.

Certian AT&T high speed Internet and Wi-Fi customers will now be able to use complimentary Wi-Fi access at over 7,000 Starbucks locations nationwide. For millions of AT&T customers, this means an exponential increase in their mobile connectivity.

This excerpt form the SBUX website explains the new pricing strategy:

"The many conveniences of Wi-Fi: There are a number of complimentary and paid Wi-Fi options, whether you need to check your email, download files for your next meeting, or just surf the Web in coffeehouse comfort.

Complimentary Wi-Fi for Starbucks customers When you register your Starbucks Card and use it at least once a month, you'll receive two consecutive hours a day of complimentary Wi-Fi, courtesy of AT&T. Complimentary Wi-Fi for AT&T DSL customers AT&Ts more than 12 million DSL customers already qualify for free Wi-Fi at their neighborhood Starbucks. Competitive pricing for paid Wi-Fi All other customers can receive two consecutive hours of Wi-Fi access for $3.99."

With this new strategy, Starbucks effectively ends its relationship with T-Mobile who had previosuly been the Wi-Fi provider for Starbucks through their "HotSpot" program, which was much costlier (10 dollars for a day pass).

However, in another attempt to win back the loyalty of their customers, Starbucks will not charge T-Mobile HotSpot subscribers any additional fees to connect to the AT&T network.

As a former Barista and general admirer of Starbucks, this is a great business move. Not only does this provide customers with a much more affordable/free solution to their Wi-Fi needs, but it also takes a huge step to regaining its third-place competitive advantage.

Customers will now be able to use Starbucks as an extension of their living room/office and encourages them not only to stop by and pick up their drink, but to stay and enjoy some leisure time or get some work done.

Not to mention, it will eliminate the shaky T-Mobile network that constantly went down and caused us Baristas countless headaches.

Schultz has truly gotten Starbucks back on track in the few months since he has regained the company's reigns, and I truly think that we will see a revitalized company and increased stock prices in the very near future.

For more about Starbucks, this article talks about Starbucks pulling back on its side venture of entertainment to refocus on their core competencies...another example of Schultz taking the Bux back basics.

This Ad's for you...

The findings of a recent study were just released regarding bar-based digital advertising. The study found that the EXTREMELY valuable, yet hard to reach demographic of 21-34 year olds was extremely responsive to ads that were shown in bars using digital screens and billboards.

“An overwhelming majority - or 78 percent - of bar visitors surveyed could recall at least one of four advertisers that ran ads on bar-based digital screens and billboards according to the Zoom Media & Marketing survey administered by the media research firm Arbitron. Additionally, the survey revealed that brand aided recall ranged from 37 to 53 percent, confirming that people not only saw the ads on the digital screens, but remembered the advertisers.”

This is great news for advertisers, who have had a tough time reaching this highly influential demographic due to their tendency to opt out of ads through means such as Tivo.

But these findings are extremely significant. Out of the people surveyed, they averaged 10 visits a month to bars with an average staying time of 2.5 hours. That is 25 hours of time that advertisers could reach these people each month.

And not only do advertisers get long exposure to these people, but the power that they represent in the marketplace is significant.

“The survey revealed that the audience polled was overwhelmingly comprised of consumers who are early adopters of new products and services, as well as influencers among their peers and family. Additionally, over 79 percent of those interviewed said their friends and family seek them out for advice on new products and services, 87 percent indicated that they actively recommend new products to others, and 93 percent said that their advice influences the consumer habits of others.

'What this means is that our bar media reaches active, social adults who have the power to create strong word-of-mouth campaigns and profoundly affect consumer trends,' said Zoom Media & Marketing President, Dennis Roche.”

As a proud new member of this demographic (I just turned 21 a month ago), I find this study to be pretty spot on. I have been frequenting a number of new bars in the Downtown Los Angeles area since then (two of the best being 7 Grand and J Lounge), and the advertising in these bars seems to be pretty effective. And while I may not be actively watching the screens in the bars or reading the ads, there seems to be an almost osmosis-like effect. I think that this is going to be a huge breakthrough for advertisers, as the bar/club scene will be the new frontier in advertising…Cheers!

iOrder????

It seems as though the "i" in front of nearly all the new Apple products over the past few years has stood for innovation. With all the advances in mobile music technology with the iPod and mobile communication with iPhones, it would only make sense that they would look to expand into another industry. But this time, it is not an industry that you would generally associate apple with...unless of course your thinking of a different kind of apple...

And yes, based on the topic of my blog, you guessed right! The restaurant industry!

Apple has just recently submitted an application to the US patent office (U.S. Patent Application #20070291710 if any of you nerds want to actually look it up,) in which, as this article states:

"Apple describes technology that would allow consumers to use a wireless device, such as a phone or media player, to remotely order merchandise from a participating merchant."

Now this description does not seem very innovative, as countless restaurants already have mobile or text message based ordering systems (Papa John's, Pizza Hut, Quiznos, Dunkin' Donuts, and Subway.) But as always, Steve Jobs and those crafty folks over in Cupertino are always taking one step further.

Their proposed technology would place wireless communication devices in the participating establishments, and when the services subscribers get into the given range, their restaurant choices appear.

And after the mobile order is placed, the user receives notification as to when their order will be ready. No more waiting in line while on the go, and patrons will now have much healthier options other than just fast food when they are in a hurry.

A leading company in the mobile ordering industry, "GoMobo, currently provides text and mobile ordering capabilities to around 200 restaurants in New York City and 10 other areas, including Philadelphia, Chicago, San Diego, San Francisco, and Seattle. Customers love the convenience of being able to avoid the lines...some locations report sales volumes of $3,000 or more a month through the service, and mobile and text orders on average are 24 percent larger than those placed at a traditional point-of-sale system."

But the benefits do not end only extend to the traditional restaurant industry. I actually just returned from a weekend trip to Las Vegas, my first since turning 21, and being able to actually all that the great city has to offer. And after spending hours in the casino at the Treasure Island, I believe that this technology could greatly benefit the gaming industry.

Everyone who has ever been to Vegas knows how hard it is to find that waitress who takes your drink order, only to return half an hour later with a watered down cocktail. Furthermore, when hunger strikes in the casino, you must get up from the table you are playing at, find the nearest food stand, place your order, wait for it to get prepared, and then eat...only to return to the table 4o minutes later. If this technology was implemented in the casinos, gamblers would have the ability to place orders wirelessly and on demand. Drinks would be able to be delivered right to your location based on the wireless signal, and food could be ready without having to wait.

Casinos would profit because players would spend less time away from the tables at the diner, and more time putting their money on the line. Bartender and waitresses could focus on filling drink orders and delivering drinks, and entirely cut out the ordering process. This would significantly increase speed of service, and increase customer satisfaction.

As you can see, the possibilities are endless. And as always, Apple is the one brining it to us first. Until then, you can catch me at the blackjack table.