The Agility Advantage

Chapter ThreeRight Customers, Right Value, Right TimeIdentify Your Most Attractive Customers and Pivot with Them

In 1987, Howard Schultz bought the six-store Starbucks chain from the original owners, and quickly began to expand. Although that particular period during the late 1980s might not have seemed the best time to buy a chain of coffee stores—total coffee sales in the United States had fallen throughout the prior decade—Schultz saw things differently. He noticed that sales of specialty coffee had increased, from only 3 percent of the market in 1983 to 10 percent in 1989. He therefore chose not to focus on the 90 percent of people who, at that time, drank run-of-the-mill coffee—brewed at home or purchased for a dollar or so per cup. Instead, ...