Monday, July 08, 2002

I am writing this sitting in a Starbucks in Wimbledon, in south-west London, on July 8, 2002. (I will log onto the net and post it later). This is quite a famous place of course. Yesterday, just down the road from where I sit, my countryman Lleyton Hewitt defeated David Nalbandian, of Argentina, in the men’s singles final of the All England Tennis championships, which was last won by an Englishman in 1936. The day before, Serena Williams of the United States defeated her sister Venus Williams, also of the United States, in the ladies singles final (won by an Englishwoman more recently than 1936, but still I don't know when). Before coming to this Starbucks I purchased a pair of trousers and a polo shirt from the Wimbledon branch of the Uni Qlo chain of clothes stores. Uni Qlo is an interesting case: this is the chain that supposedly revolutionised the way the Japanese dressed. Essentially, its like the Gap, only Japanese, and somewhat cheaper. It has stores in Japan, and in the United Kingdom. That is it. Just down the road, there is a branch of the Gap, too.

Starbucks too is in interesting case. The company has a reputation from the opponents of globalisation as being the arch enemy: the company that destroys local cultures and decimates all in its wake. And yet, what is curious about Starbucks is the relatively small number of countries it operates in. A few rich countries: a few peculiar countries in the Middle East, and not much else. There just don't seem to be many places that support the $3 cup of coffee in a nice friendly environment. (Starbucks are good at certain things, though, like providing power outlets for you to plug in your laptop).

The details of Starbucks entry to the British market is quite amusing. Prior to 1995, it was extraordinarily difficult to buy a decent cup of espresso based coffee in London. Scott and Ally Svenson, an American couple from Seattle, who were living in London, decided that this was terrible and something had to be done about it. They therefore founded a chain of coffee bars in London, selling the types of espresso based beverages that were becoming common in the US. In the US, this trend started in Seattle, and then spread all over the country. The company in the vanguard of this spread was of course Starbucks, and the Svensons’ British chain was essentially a clone of Starbucks. The same sized cups, the same names for the sizes (other than Venti, which Starbucks have a trademark claim on), the same filter coffee of the day, the same mix of hot and cold coffees, the same mixture of comfortable and more businesslike chairs in the stores. For probably the same reasons that Starbucks was a success in the US – it had previously been extremely difficult to get a decent cup of coffee – the Seattle Coffee Company, as this chain was known, was quite profitable. And then, a funny thing happened. Starbucks decided that it was time to spread into the United Kingdom, and, seeing that someone else had already set up the infrastructure for a chain of Starbucks stores in the UK, Starbucks bought the Seattle Coffee Company outright and rebranded all the stores as Starbucks. (Having a lot more capital than the Seattle Coffee Company, Starbucks then opened new stores much more rapidly than the Seattle Coffee Company ever could have, although they did have 64 shops at the point they sold out). What happened was kind of curious. Rather than barging into the UK market and crushing all in its way, what Starbucks actually did was enter the market after demand had already created its stores for it. Starbucks sort of built itself in London without the company's involvement. London is that sort of city.

And that was how I felt this afternoon after buying my clothes from a Japanese chain store, which incidentally has shops in Japan and the UK and nowhere else. London is I think one of the two most globalised cities in the world, the other being Tokyo. New York is perhaps close, but it is too parochially American (although it is the least parochially American of all America's cities). It's a fascinating place.

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