Thursday, October 04, 2007

Challenging Starbucks

Yesterday Allen Robinson and myself co-hosted our Sports Business Edition of the Houston Business Hour at a little coffee store called the Coffee Oasis. This event was arranged by Allen and the Oasis is clearly intending to challenge Starbucks in the Houston area. While there I noticed:

* A comparable quality drink

* A slightly lower price

* Free Internet (versus around $10 at most Starbucks)

* An environment very similar to Starbucks

It was a great event and we got to showcase some of the local high school teams. Also it appeared the shop was doing quite well for itself. But it also reminded me of the power of the free market and the great thing mega companies (like Starbucks) does for the economy as a whole. Starbucks proved you could have virtually unlimited establishments with relatively high priced hot drinks and make a sizable profit (sure they still sell food and music, but coffee is their mainstay). Starbucks proved it could be done and their prices are high enough to make room for competition. That is what leads to the rise of Coffee Oasis and other entrepreneurs trying to achieve the American Dream one cup at a time.
Note: Order Kevin Price's audio program The Accumulators, which explains the impact that the Internet is having on marketing and consumer behavior. It is available online here for only $10 plus p and h. Receive the Houston Business Review e-zine free each week by clicking here.

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Anonymous Anonymous said...

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6:46 PM  

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