Back in 2007, Starbucks was in a hole that appeared too deep to climb out of. The company’s performance had declined considerably and the customer experience had been greatly diluted. Several causes contributed to Starbucks’ decline, among which included the loss of human connection. Fewer baristas were remembering customers’ names, and the introduction of automatic espresso-making machines hid the very process of coffee making. Additionally, the company had deviated greatly from its core strengths by expanding into breakfast sandwiches. This became problematic because the cheese from the subpar sandwiches began to cover up the aroma of the coffee. This was reflected in the sharp decrease in their stock price, which declined by over 40% in 2007. The well-intentioned efforts at transformation had backfired, reducing customer loyalty and bringing to light Starbucks’ deficiencies among its competitors.
The Fix:
This downturn didn’t go unnoticed for long as the original owner and CEO of Starbucks, Howard Schultz, returned following an eight-year hiatus to succeed the then CEO Jim Donald. In his memo, Schultz emphasized the urgent need for the company to return to its roots. Since the early 1970s, Starbucks had successfully positioned itself as the third spot, after the home and workplace, where people can hang out and cheerfully spend their time. In this connection, he started by amending the menu, eliminating the infamous cheese and egg sandwiches and reverting to the Mastrena espresso machines that enabled customers to witness the coffee-making process. He coordinated machine per serving, substantially increasing the aroma of coffee. This worked and the results showed. Customers began returning to Starbucks in greater numbers, and the stock climbed greatly (as of the time of this writing, Starbucks stock is selling at over $100). The business’s decision to branch to far beyond its core strengths resulted in a momentary loss of clout and dilution of its competitive advantage.
This same principle holds true when it comes to managing the locations and venues you frequent. As is the case with Starbucks overextending itself, you should not spread yourself too thin in the social scene. Put simply, you should avoid consistently moving beyond your 4-5 favorite bars and restaurants unless you have a strong reason to do so (i.e. you are trying to establish a relationship with an important contact and he insists on going to his favorite establishment). These are the places where you have the best chance of making advancements in business negotiations, deals, friendships, dates, etc. These 8-10 places (bars + restaurants) should be your blonde, medium or dark roast – your core strengths. The places you venture into beyond these are the crappy cheese sandwiches and experience-diluting expresso makers – they do you more harm than good.
The Action Plan:
Write down a list of the restaurants and bars you enjoy frequenting the most. If you don’t have any, go out for a walk and frequent a few. Make sure they are all within walking distance or a 10-minute cab drive from your residence.
Get to know the employees there inside out- the waiters, waitresses, bartenders, barbacks, bouncers, maitre d’, etc. Build close rapport with them – know them on a first name basis, who their best friends/boyfriend/girlfriend/wife/husband are, their shift hours, hobbies, etc. Tip them well (30-40%), offer to buy them drinks, introduce them to your friends, invite them to the parties you plan to go to, and so on. Since these people work in the service/social industry, they tend to be very interesting to be around.
You are now well-positioned to build status for yourself. This status takes away the need for you to wait in long lines, gives you discounts on drinks (and free drinks too), and most importantly, makes those whom you are trying to impress aware that you are an important figure in the room. Considered in terms of ROI, this definitely works to your advantage- time saved from waiting in line, reduced net costs, surge in popularity. There is no denying that everyone is attracted to people who are highly regarded (yes, you can deny this applies to yourself all you want but deep down you know you are lying). Sit back and watch as your recognition proliferates over time.
Guidelines to Stick By:
Showing up to any nightlife venue with a group of 3+ guys is rarely a good option. The exception is if all of you appear confident, tall and are good-looking (6’2”+, 7/10 or higher). The nightlife industry places a very strong emphasis on amassing a good-looking crowd – that’s the key driver of their bottom line. A wise rule to follow would be to aim for a 1:1 sex ratio in your small group, at least initially. Once you are truly established in a venue (8+ visits) you can skew the ratio and reduce your dependency on girls.
As for location, it is extremely important to have your favorite bars/restaurants/clubs located within a one-mile radius from your bedroom. Yes, this means living in a centrally located neighborhood where rent is higher but this will save you a great deal of time (more if you are working a good-paying corporate job). For instance, our go-to bars have lines on weekends that can easily set you back by 30 minutes to an hour. Assuming you aren’t still a college student, you shouldn’t be waiting in these kinds of pretentious lines. Whenever we show up to a venue, we go right past this line, get greeted by the staff inside, place our orders and get our drinks, all of this happening in under two minutes. The standard rule of thumb in the industry is that it is okay to give a customer a fourth drink on the house for every three drinks purchased. Our result: every second to third drink on the house. Even better, bartenders make us drinks that are not on the menu and serve us food free of charge too.
But enough about us, let’s talk about you: Do you have the influence?
If not, now is the time to start building it. Stop trying out new places and focus on the good establishments you already enjoy spending time in. Zero in on your favorite bars, clubs and restaurants where the logistics work in your favor and start generating new relationships and connections and building brand awareness for yourself.