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It’s 1971. Fledgling Starbucks opens with three friends selling coffee beans in Seattle. No drinks of any kind, just beans. They are losing money and thinking of closing down. They limp along for years until Howard Shultz comes along.
Shultz had seen a coffee shop in Europe, which gave him an idea of how to transform Starbucks. In the European store, the barista knows everyone’s name. It’s not just a transaction; it’s an experience that he has never seen before.
In 1987, Shultz, who was the former marketing director, took over Starbucks.
He has a dream and wants to move on it. He opens his first store under his new format. Customers don’t react well. Sales falter. His friends ridicule him. The format is not received well. Yet, Howard notices something. The few customers who understand the new format really get the concept, so they keep coming back. They bring friends and stay for hours.
Howard soon realizes he’s building something unique. Not home, not work, but what he calls the third place, or somewhere in-between.
He eventually opens six stores in Seattle. Each new location is slightly different from the last, as he learns with each one.
Then comes the breakthrough with the Pike Place Market store. Tourists are beginning to discover this weird coffee experience. Word spreads rapidly. Suffice it to say, the radical new concept has caught on.
Shultz has taken what for years was an afterthought to a meal or a hurried cup on the go and turned it into a full-blown sit-down experience where the focus is on the coffee and the socializing.
1987 also saw the first store outside Seattle. The concept spreads like wildfire.
Hundreds of ‘me too’ coffee shops begin to open. America has an entirely new retail experience to enjoy, which remains a staple to this day.
In 1992, Starbucks went public. The failed coffee shop eventually becomes a $25 billion empire.
Will that be a ‘tall’ latte?
Everything else is just history
