Profits through Compassion

Starbucks Coffee CupStarbucks people love Starbucks.  They love the atmosphere, the attitude with which they’re treated, and the opportunity to be in the same space as other people who frequent Starbucks; their people.  At the end of the day, people want to belong – they want to feel like they’re a part of something larger than themselves.

It may seem silly to think people could get that sense of belonging out of a cup of coffee.  Then again, 18,000 locations and annual gross margins in excess of 5.7 billion would argue otherwise.  It turns out, the tangible cup of coffee isn’t really what Starbucks is selling.  Sure, it’s what you walk out of the store with, but the intangible sense of being appreciated and respected – of being a part of a community of likeminded people – doesn’t have a price tag.  People don’t know what to pay for that.  So Starbucks charges them $4.95 for it… and it comes with a free coffee.

Show your people you care about them, provide them with a high quality product (not even necessarily exceptional, just high quality), and they’ll keep coming back for more, almost regardless of price.  Oh, and it helps if you can serve an addictive chemical as a staple, too.  Caffeine, anyone?

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