Your local indie coffee shop may be a Stealth Starbucks

A Starbucks in disguise: Seattle's 15th Avenue Coffe & Tea in 2009. Image: Getty/AFP

Coffee giant Starbucks is always looking for new ways to tighten its grip on the coffee market. Last year, to take one example, it launched “Starbucks Reserve®”,  a new line of Starbucks outlets finely tuned to corner the market of coffee drinkers looking for a more high-end experience.

Of course, there’s one subset of coffee drinkers the firm has yet to conquer: those who refuse to get their coffee from big coffee chains like Starbucks. But they’ve got a plan for that too: the Stealth Starbucks.

Stealth Starbucks actually have a considerable history. The first one opened in 2009 in Starbucks’s traditional stomping grounds, Seattle. The new store was named “15th Ave Coffee & Tea”, but the front door featured a telling disclaimer: “inspired by Starbucks”. In the years since, Starbucks has opened two more stealth locations in the city.

Word got out about these Stealth Starbucks, and though some reacted positively to them, others lashed out. Independent coffee shop owners were naturally displeased with the thought of a giant chain camouflaging itself and possibly siphoning off their business. As far away as Chicago, a local coffee shop owner called Stealth Starbucks “the equivalent of unmarked cars”.

But Starbucks’s CEO, Howard Schultz, has maintained that these outfits were never intended to dupe indie-loving coffee customers. “It wasn't so much that we were trying to hide the brand,” he said in a 2010 interview with Marketing Magazine. “[We were] trying to do things in those stores that we did not feel were appropriate for Starbucks.”

Whatever the motivation, the project nevertheless did well enough that the company’s higher-ups decided to take the project on the road, from sleepless Seattle to another city that never sleeps. In 2012, the chain opened its first stealth Starbucks in New York, inside a Macys department store.

There are hints that there might be more. Veteran barista Molly Osberg feels that New York City’s unique love of independent coffee shops may be behind Starbucks’s move. “Almost 60 percent of New York coffee shops weren’t associated with a corporation,” she wrote in a recent article in The Awl. “The trend is so pervasive that Starbucks itself opened its own unbranded coffee shops, sans the company’s own name.” 

In the midst of the continuing hubbub over Stealth Starbucks, the fundamental question still remains: why is Starbucks doing this? Aren’t they making enough money already as the world’s biggest coffee chain? Is their motive really, as their CEO says, to serve as a “laboratory” for new products and ideas?


The answer may actually be yes, though for much more cynical reasons than any Starbucks rep would care to admit. Mike Hudson is the founder of the independent coffee chain Handsome Coffee, which was later acquired by Blue Bottle Coffee. He thinks that these stores are effectively a mechanism for Starbucks to test out which ideas it’s going to steal from potential competitors.

“Given Starbucks’s market position, it could fall prey to a competitor with innovative ideas,” Hudson says. “The stealth outlets are a grossly patronising move by Starbucks to stay current. But they’re also a legitimate attempt to make better coffee, in the event America decides that Starbucks’s mass product offering is inferior to ‘the new thing’.”

While marketing calculus and experimentation may be the prime motivator in the creation of Stealth Starbucks, the outlets are still intended to turn a profit – and in that sense it’s significant that the mega-chain opted to open them exclusively in Seattle and New York. Despite the standardisation of consumer preferences worldwide after decades of omnipresent brand-based marketing, local preferences can still vary widely. These two cities, the move suggests, are the places Starbucks feels must be hungriest for some kind of change.

But ultimately, the most significant development to emerge from the Stealth Starbucks program may be its influence on the strategies employed on the Starbucks Reserve outlets. A New York Times article from last December confirms that the outlet’s logo, which abandons the traditional Starbucks “mermaid” seal, is a deliberate attempt to distance the Reserve locations from the standard Starbucks brand.

Starbucks plans to open roughly 100 outlets under the “Starbucks Reserve” branding scheme, far more than the four Stealth Starbucks outlets it currently operates. But those stealth Starbucks are still going strong, and there are no plans to close them in the near future. That Starbucks has made such inroads into the anti-Starbucks market is, in a way, a testament to quite how sophisticated modern marketing has become. 

 
 
 
 

Five ways in which the rest of the world can avoid the homelessness crisis plaguing the US

Housing for all. Image: Nicobobinus/Flickr/creative commons.

Homelessness is a growing problem in the UK, where the number of people sleeping rough has doubled since 2010, yet it is dwarfed by the scale of the issue in the US. More than 500,000 homeless were found across the US during just one night, compared to the UK’s 2017 count of 4,751. Changes in the definition of homelessness and flawed methodologies suggest that the true number for the US could be anywhere from 2.5 to 10.2 times greater.

Millions more live in overcrowded or slum housing, forced to choose between the damage that poor conditions do to their physical and mental health, and the street. All of the US’s housing issues – from foreclosures to evictions to poor conditions – hit communities of colour the hardest.

This is due to a legacy of discrimination, which continues to undercut any commitment to safe and decent housing for all residents, whether in the private or public sector. In my recent book, City of Segregation, I explain how the long, violent history of creating spaces for the white and privileged classes is embedded in a number of practices, which continue in US cities to this day.

Exporting inequality

As private developers and investors seek out urban land in major cities around the world to secure their fortunes, real estate patterns and practices developed within the US are increasingly being observed elsewhere.

In cities as diverse as London, Sydney and Durban, community groups which have been working for decades to improve their neighbourhoods languish with little public or private resource. Meanwhile, developers create spaces for foreign investors and new residents, who anticipate certain protections and privileges such as greater security, high quality amenities and neighbours with similar interests and backgrounds.

This is a driving force behind rising evictions and the criminalisation of homelessness, alongside gated communities, hostile architecture, “broken windows” policing with its focus on prosecuting activities such as graffiti or jaywalking and the growing privatisation of public spaces through regeneration.

But there is still time for other countries to choose a different path. The UK, in particular, can build on the legacies of the post-war political consensus that all residents should have access to quality housing, and its acknowledgement of institutional racism and some history of government anti-racist campaigning.

Both legacies should be improved, but a renewed commitment to a programme of housing and anti-racism are central to increasing equality, prosperity and well-being for all. Based on my research, I’ve come up with five steps which the UK and countries like it can follow, to ensure that future development reduces – rather than drives – homelessness and inequality.


1. Build social housing

Unlike the US, the UK acknowledges a right to a home, and within living memory provided it for a huge swathe of British society. Social housing – whether in the form of traditional council flats, cooperatives or community land trusts – provides a variety of housing types and keeps rents from rising too far beyond wages.

When social housing is widely available, it makes a huge difference to people who – for one reason or another, and often through no fault of their own – become homeless. With social housing to fall back on, homelessness is a temporary condition which can be safely resolved. Without it, homelessness can become a life-destroying downwards spiral.

2. Preserve and expand community assets

Severe segregation in the US stripped entire communities of access to quality food, jobs, education, green spaces, services, banks and loans. Poverty is endemic, and can easily tip into homelessness. While far from perfect, the UK’s post-war commitment to universal provision of services, such as education and health care, and building social housing across all neighbourhoods underpinned a surge in upward mobility.

This achievement should be salvaged from the damage done by Right To Buy – a policy which sold off social housing without replacing it – and austerity, which has prompted a sell-off of public assets and land, as well as the closure of childrens’ services, libraries and community centres.

3. Decommodify housing

A market geared towards building apartment blocks for the portfolios of investors who will never live in them cannot produce the kind of housing and neighbourhoods which residents need, much less at a price they can afford.

While London has been badly affected for some time, this trend is now spreading to other areas of the UK and Europe. Local and national governments must act to prevent global demand for housing as investments from driving prices beyond the reach of those who need real homes.

4. Build communities, not walls

Gates, bars, armed security and homeowner restrictions are all ugly traits of private housing developed within the US context of desperate inequality and racism. The UK has a long and vibrant tradition of community development, creating a supportive built environment and social infrastructure of schools, libraries and other municipal services for residents.

Community assets. Image: Helen K/Flickr/creative commons.

This kind of development, and the social mobility and growing equality it fosters, safeguards public health and safety – not big walls, barbed wire and security guards. The private rented sector in the UK should be regulated to bring it more in line with Europe, where tenants prosper with security of tenure and strong regulation of rents and rent increases.

5. Raise your voice

Those who are bearing the brunt of our current housing crisis must be at the centre of efforts to change it. From tenants’ associations and renters’ unions, to campaign groups such as Justice for Grenfell, it’s vital to support those voices advocating fairer housing rights.

This also means rejecting austerity’s constant cuts to public services, funding social support for physical and mental health and ensuring that homes are safe, decent and secure, to create a safety net for those who are working to improve their communities.

The Conversation

Andrea Gibbons, Researcher in Sustainable Housing and Urban Studies, University of Salford.

This article is republished from The Conversation under a Creative Commons license. Read the original article.