Starbucks is a real (profitable) setting for virtual community

Summary:Starbucks and Yahoo! have partnered on a dating service promotion. Starbucks may be the only retailer able to match the brand loyalty of a search engine.

Valentine's Day is the biggest business opportunity of the year for dating services. Long, long ago, when Match.com first launched and I was on the board of directors, a successful Valentine promotion could increase membership by 10 percent or more. Now, Yahoo! Personals and Starbucks have partnered to promote sign-ups for Yahoo!'s dating service by giving away coffee gift cards for new members and promoting Starbucks locations as safe and enjoyable places for first dates.

Starbucks has tried to be the interface between online services before, investing in Kozmo,Daters are already engaged in a commercial relationship, creating a bridge between spending money in the online and offline experience. the failed online ordering-home delivery service that used Starbucks locations as a drop-off point for returning movies. The company has dabbled in music distribution, too. But this kind of deal sounds much more reasonable, because it requires no up-front investment other than some coffee credits and takes advantage of the most important element of the Starbucks retail experience: People visit their favorite Starbucks more than 24 times a month.

No other retailer engages personally with customers as frequently. McDonald's most loyal customers may visit six times a month while grocers may see their customers twice a week, though without the social elements that restaurants offer.

Starbucks, by contrast, is a place people go every day, almost like they come to rely on a search engine as a core part of their daily routine. So, Starbucks is uniquely prepared to be the real-world venue for services initiated online.

In dating, women especially are concerned about finding a safe way to meet someone for the first time (this was always a challenge with Match.com, which at that early stage of online dating when I worked with the company had to combat the perception that stalkers might use the service to find victims—they didn't generally, and the community of women on the service soon established a communication system that warned others away from bad guys).

A familiar setting for that meeting, a Starbucks where the daters are used to the sounds, smells and comfort of the store, is an almost ideal retail complement to online services.

The economics make sense. If Starbucks can take a part of the revenue from customers who join online services through meetings that happen at its coffee shops or, at minimum, get $10 in coffee revenue from Yahoo! for hosting the first meetings of daters, there's no downside at all while the company gets a chance to introduce itself to new customers who may become regulars. After all, the place where a couple first met becomes a frequent meeting place.

Starbucks has stayed away from hosting Meetup events, because they don't come with the same kind of economics. Instead, these community services, which seldom charge or create the expectation that participants in a meeting will pay, are seeking a physical site that wants to bet its amenities can convert members to customers. Daters are already engaged in a commercial relationship, creating a bridge between spending money in the online and offline experience.

Topics: Browser

About

Mitch Ratcliffe is a veteran journalist, media executive and entrepreneur. He was editor of the ground-breaking Digital Media newsletter in the 1990s and a frequent contributor to ZDNet over the years. He led development of the first Web audio/video news network at ON24, sat on the board of Electric Classifieds Inc. and Match.com, and wor... Full Bio

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