Starbucks is selling a bigger idea than coffee
You may not know Richard F. Teerlink, but you know his work. Teerlink oversaw one of the most amazing comebacks in American history. Starting near bankruptcy, he soon had people signed on two-year waiting lists to buy his product. The secret to Teerlink’s turn-around? He quit selling his product.
No, he didn’t fire the sales team and close the cash register. Instead, Teerlink realized he needed to sell something much bigger than his product. Sound crazy? Howard Shultz doesn’t think so.
Howard Shultz, who recently stepped down as CEO of Starbucks figured out years ago that he was selling something much bigger than coffee.
Why do people line up and wait for a cup of overpriced coffee when they can get one faster and cheaper at Dunkin Donuts or McDonald’s? You may be tempted to say the store ambiance or coffee flavor, but I contend that it’s more than that. Recently, as I was waiting in line for my own overpriced cup of coffee, I became intrigued by the display stand at the beginning of the line. Then I chuckled and snapped a few pictures of the display. Fun, cheer, coziness, bliss and community are the focus of the sale. People eagerly pay much more for those things than they pay for a cup of coffee.
New research shows that buyers and sellers are misaligned. Get the latest survey results from over 500 global companies.
Apple also knows what Richard F. Teerlink and Howard Schultz know. You can see it in their advertising. JBL and Apple are both running ads for a product to play music in a wet environment. JBL is selling their product, while Apple is selling something much bigger. Watch these two ads and see if you can figure out the difference:
https://youtu.be/CeDFWcwq3qw
https://youtu.be/La4HRfL5tV4
The JBL ad is creative and entertaining, but it’s got several problems. For starters, the ad actually voices, “This is most amazing thing I’ve ever seen. It’s unbelievable.” If your ad has to literally tell the viewer that your product is amazing, then your ad is a total failure and should be scrapped. Your ads must drip, ooze and explode “amazing” so much that saying it seems entirely redundant. But this is the smaller issue with the JBL ad.
The bigger issue is the JBL ad is about the product, while the Apple ad is about who you can be. The Apple ad shows a man well past his prime who commands the attention of everyone around the pool. As he boldly approaches the diving platform, people clear the way and stand in awe as he passes. A little girl holds his glasses and looks up at him. He pauses at the top of the platform to survey the crowd. Yes, they are all watching to see what he does next. Then the dive. You gasp as you think he is about to belly flop. He doesn’t belly flop. No, he pulls it off. This man is amazing and you can be amazing if you buy an iPhone 7. Selling the ability to be amazing is a much bigger idea than selling a phone that can get wet.
When was the last time you bought an Apple product on sale? Yes, I hear you. You’re saying that is over-analyzing that Apple ad. Perhaps, but Richard F. Teerlink might disagree with you. Teerlink understands the difficulty of explaining the big idea that is more than the product itself. He said his biggest challenge was convincing investors that he wasn’t selling motorcycles. They always replied, “Of course you’re selling motorcycles! What are you talking about?” But Teerlink explained, “No, I’m selling a lifestyle and people will pay much more for that.”Forty years ago Harley Davidson sold motorcycles to bikers and they almost went out of business. Today they sell a lifestyle. Doctors, lawyers, entertainers and all the cool people now write big checks to live in the moment and experience a taste of their inner rebel buried deep within. What are you selling?
New research shows that buyers and sellers are misaligned. Get the latest survey results from over 500 global companies.