Three reasons why I believe Starbucks would dominate the hotel industry.
Starbucks has created a winning business formula, which I believe would allow them to be successful in any hospitality segment. They could easily be one of the top hotel brands in the world. The reason I make this assertion is that I believe Starbucks has developed that special blend of tangible and non-tangible business elements and approaches for achieving a very beloved brand by both the employees and customers as well as creating undeniable financial results.
One of the main ingredients in the Starbucks business formula.
Starbucks utilizes customer experience design strategies for developing their entire business, especially when it comes to their business model’s value proposition, which has evolved from a commodity offering of a coffee bean, or a cup of coffee, in the very early beginnings of their existence, to now the total customer experience of the business entity.
They have become a very mature company, when it comes to understanding people and what business they are really in. I see so many businesses continually doubling down on increasing their product and service offerings as a way to create customer loyalty or build brand relevance to gain competitive advantages over the competition. What a lot of these businesses are realizing is that this approach is very limited and does not create very good ROI results or build sustainable financial performance. The business either runs out of things to spend money on or they just plain run out of money.
Starbucks’ approach takes everything into account, so that they become a lifestyle brand to their customer segments. They balance the physical product and service offerings with the emotional connection of the brand values and promise. They realize that they are not in the coffee business; they are more fittingly in the business of creating positive and memorable experiences for their customers.
They are enrolling their customers in the total customer experience of their business. They have built a brand experience that is an extension of people's personalities, as well as a support in their customers’ lives.
I think if this one business strategy was adopted by the hotel industry, it would have a transformative effect on the way the industry goes about doing business with its customers and employees as well as how it looked at each discipline within their business. However, it seems like the hotel industry is more interested in adopting the airline industry playbook and becoming more of a commodity driven business segment, rather than experience driven and people focused.
Starbucks is more interested in connecting with you on a personal level than just selling you a cup of coffee. They don't want to make a sale; they want to make you happy. Commodity driven enterprises are only interested in selling you a cup of coffee or a hotel room. The commodity enterprises are hoping that the product offering is strong enough and good enough to seal the deal for building legitimate customer loyalty results. They have a make-and-sell type of mentality, rather than enrolling and connecting their customer to the non-tangible aspects of the business for enhancing the relevance of tangible aspects of the brand.
Starbucks’ leadership and management position is focused on people for achieving win-win.
Starbucks’ senior leadership and management realizes that once they move their value proposition of the business from a commodity and product based position to the total customer experience that they had to take into consideration the employee experience of the business enterprise as well in order to achieve the level of service excellence and customer connectedness that was required to create an emotional bond with their customers that allowed them to maintain brand relevance.
Starbucks understand that it is a cumulative effect of all the different aspects of the business that contributes to generate a positive and memorable connection with their customers. Starbucks has an intimate understanding when it comes to balancing the product offerings, environment, culture and their people for enhancing the trust factor within the brand experience.
The leadership and management of Starbucks understand their role as being structural support presence for their operational teams and not trying to be the star of the show. Starbucks leadership and management run the brand, and their employees grow the business as well as maintain the brand values and promise. This is very rare to see in the hospitality industry enterprise, which is normally plagued with command-and-control style leadership and management presence, but Starbucks believes in its people. Another key ingredient in the success formula. They understand the importance of establishing trust and integrity in the organization’s internal culture first, and then it can have a better chance of achieving that with their customer segments.
Starbucks has built a strong foundational cornerstone to properly support and maintain the business culture.
Starbucks exists through their core foundational principles on which they build their enterprise. They are defined and very well-balanced on achieving customer value as well as company value through being a very goal-oriented company. This is not an overly complicated business strategy. It's just a more intuitive design approach for creating balance with all the shareholders within the enterprise, which allows them to be externally focused on the customer coming in to their business, rather than just having tunnel vision on the internal aspects of the enterprise.
Their vision and mission statement supports the total customer experience position and reinforce the service excellence initiatives, as well as properly align with all the other business disciplines within the company for being a catalyst around product and services development. Their values, purpose, and passion are externally focused on the customer and employees. They are committed to creating a customer eccentric business environment that's dedicated to anticipating and managing customer expectations. Here again, this is more intuitively designed for achieving balance throughout the business enterprise.
They understand the importance of brand values properly aligning with the brand message and the brand promise. This is probably one of the biggest reasons why I think Starbucks would be so successful as a hotel brand. They understand the importance of creating experiential value for achieving cult-like customer and employee loyalty, which is obviously one of the main contributing factors to their financial performance and brand success.
Starbucks recognizes the importance of making people feel good about themselves from their experience with their entire business enterprise. They don't subscribe to the perspective of trying to make their customers feel good about the value associated with the Starbucks' brand per se. That would be a typical business model approach in trying to create brand value through achieving strong brand equity through this paradigm. This will take a business enterprise down a very internally focused road that most often leaves the customer well outside the business equation in which a business end up commoditizing their customers. Like the airline industry has done to their customers.
It's not so much what you do, but how you do it in your customers eyes. What I mean by this statement is, is your company people focused or are you strongly product focused? Do you like your product more than your customers. Is your business more focused on beating the competition, than meeting and exceeding your customers’ expectations? Do you manage your guest experience or do you leave it up for chance and have it manage you? Is your company designed around the customer, or just around the bottom line. Take a moment and compare your hotel enterprise business formula to Starbucks business formula, and start designing and creating your winning formula.
About the author
For over thirty years, Brett Patten has worked in the hospitality industry. He spent those years accumulating invaluable insight, knowledge and experience through his various positions, and studies, from when he starting out has a front line employee at the age of 15, with a four-star hotel in the 1980s', to recently completing his education as an executive leadership and engagement coach. Brett's unique management style consistently transformed his work environments by focusing on his people and customers for creating a engaging hospitality experience which generated strong sales and operational performance results. In 2007, Brett launched Fire and Vine of Virginia Beach, a new world wood fire cuisine restaurant built on a hospitality business strategy process that he trademarked and now calls "five-star customer experience design." Within the first two years under Brett's strategic business approach, Fire and Vine was recognized nationally for its hospitality management, design elements, employee development, customer service excellence, culinary cuisine, and wine program.
Today, after spending the last 15 years researching, studying and developing customer experience design best practices and strategy implementation for the hospitality and tourism industries. Brett has created an innovative Hospitality Business leadership and management Program. Which aligns all the business disciplines and strategies through a customer experience design approach, for creating a customer driven brand connection, as well as elevating the engagement dynamics of the business culture for establishing positive customer loyalty and sustainable financial performance results through the generating of exceptional and memorable brand and customer experiences.
