Wednesday, February 17, 2010

The Infill


While diving home the other night I came to a red light and noticed there was a Starbucks on one corner and another Starbucks in a strip mall across the street. Initially I laughed, and then got slightly annoyed. I thought to myself, what a waste of money to have 2 Starbucks across the street from each other. Wouldn’t that be cannibalism? I’ve heard of this before but never thought it truly existed. Yet, I didn’t allow myself to stop there. I felt there had to be a reason why this was okay in the business world.

Realizing that there was no way Starbucks was in the market for cannibalism I decided to research this a bit. I found out that Starbucks, along with other companies, do this strategically for various reasons. Starbucks calls it “infill” for the idea of having a Starbucks on every corner. They’ve said it is beneficial for Starbucks to have stores across the street from each other which actually helps sales. When people are in a situation where there is a Starbucks across the street, because Starbucks coffee tends to be more expensive than other coffee shops, some people wouldn’t cross the street. Yet, if there were a Starbucks on the same side of the street as them, they would step inside for a Grande Decaf, Non Fat, No Foam Latte.

Thinking about this I’ve realized that Starbucks not only has found a way to get customers in their doors, they’ve pretty much checked off everything on the list for marketing their brand. One thing pops into mind: location, location, location. Starbucks has every location so they don’t need to worry about this. So remember the next time you see 2 Starbucks across the street from each other, they’re doing that because you were too lazy to cross the street.

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