retail news in context, analysis with attitude

Interesting piece in the New York Times about Starbucks’ in-store music business, which just a few years ago was seen as a way to market sophisticated, eclectic, even unconventional songs and albums to what was seen as an aspirational consumer demographic.

“But the ardor for Starbucks has gone the way of yesterday morning’s grounds,” the Times writes. “Critics in the music industry say the company squandered its cachet by mismanaging the effort to broaden its music mix. The choices that reflect its early taste for the offbeat — like an album from Lizz Wright, a torchy pop singer — are now squeezed in with offerings not unlike those at Wal-Mart, including the latest releases from Alicia Keys and James Blunt … Along the way, Starbucks has alienated business partners who contend that it has demanded too big a cut of music revenue. The company’s shift in direction has also prompted upheaval within — including the departures of half a dozen senior executives from its entertainment unit.”

Starbucks said its music sales are healthy and that it sold 4.4 million CDs in North America last year, up some 22 percent from the year before; however, at least some of this increase likely can be traced to the company’s increase in store count…since it sells just two CDs per store per day.

KC's View:
I suspect that Starbucks may be suffering from its attempts to become a cultural icon, rather than settling for being a coffee icon. And it may be fair to suggest that its various efforts in the cultural area – in music, books, movies – have distracted it from the core business.

Though I have to be honest. I always sort of thought the notion of Starbucks putting its imprint on the culture was a cool idea…one that would take it beyond simply being a coffee company.