By prioritizing their product over a personal connection Starbucks set themselves up for failure.
Starbucks in Australia should have learned from the most successful cafe owners in Australia before wasting millions of dollars.
In March 1970, Gus Petersilka, owner of Gus’s Coffee Shop, Garema Place Canberra decided to pop a couple of chairs on the pavement outside the cafe. He though it would enhance the experience and help his customers enjoy the sun and watch people. Soon after he received a note from Land Department.
The next day, Gus discovered that the tables and chairs had been taken away on the back of a Department of the Interior truck. As a result of the public outcry led by Gus, those tables and chairs were returned and became a permanent feature during Canberra’s long hot summers. During the chiller months, Gus closed the area in.
Gus was a Viennese born refugee from the Nazis who arrived in Australia in 1951, landed in Canberra in 1964. My first connection with Gus is that he opened his coffee shop in 1969, the same year I landed in Canberra as as a 6-month old. My father first took my brother Miles and then me to Gus’s to teach us chess and to while away hours before Sunday night movies. Gus was almost always there.
Gus would comment on the chess game, or let us know his latest fight with local bureaucrats on how they needed him to change his awning.
When Gus passed away in 1994, his passing was noted in the local parliament, and a street named after him. In his comments, the ACT Chief Minister, noted how strong the connection was between him and his community. ” Gus epitomised the emerging soul of Canberra. His constant representations on behalf of the people of the city produced the establishment of the outdoor Viennese cafe throughout Canberra. He was the scourge of the establishment and a crusader of the people. His friendly hospitality and fierce determination has been indelibly stamped on the character of Canberra. May his energy, vision and laughter live on in this city. ”
Gus’s entire business was built on the connection he had with his customers.
The failure of Starbucks in Australia is a powerful reminder of the consequences of trying to sell your product before establishing a connection with your customer.
Starbucks failure in Australia cost the company $105 million dollars. Rather than build a connection with their customers, they imposed their products onto them.
Gus’s veneration in Canberra is testimony of the power of connection. His success could have shown Starbucks that regardless of the quality of their products, they should have focused on serving their clients what they want.