Starbucks Hopes to Win Over Coffee Snobs With More Fancy Coffee Shops

Starbucks’ continues to pour money into its attempt to woo coffee snobs. On Thursday, company CEO Howard Schultz told Reuters that the chain plans to expand its line of upscale, Reserve stores — by sticking smaller versions of them inside standard Starbucks stores.

Reuters reports that, by the end of 2017, the chain will have Reserve coffee bars inside up to 1,000 Starbucks cafes. According to a company spokesperson, some of the stores will be brand new and others will be renovations of existing stores. Starbucks is currently trying to determine which neighborhoods are best suited for the Reserve coffee bars, but most will likely be within the U.S.

“All will include a Reserve bar coffee experience and those elements will influence the way that particular Starbucks looks, but they'll also still have the core menu of a traditional Starbucks,” says a company spokesperson. That means each of the 1,000 stores will include the standard Starbucks fare — croissants, Frappuccinos, White Chocolate Mochas — plus a Reserve coffee bar with manual Black Eagle espresso machines, pour-overs, Chemex, and nitro cold brew taps.

The company is currently testing the Reserve coffee bars at twelve Starbucks locations in New York, Chicago, Atlanta, Baltimore and Boston. A spokesperson says “it’s just the right time” for the brand’s foray into higher-end coffee: “Manhattan is the perfect place to test the concept,” she says. “It has a very high coffee IQ. We know what our customers want more from us, they want more experiential elements. And the Reserve element gives them the chance to engage at the coffee bar, to talk through coffee with the baristas.”

Over time, the chain also expects to open somewhere between 500 and 1,000 cafes exclusively selling Reserve coffees. Those concepts will mirror the Reserve cafe in New York’s Chelsea neighborhood, where a 12-ounce coffee costs nearly twice as much as a cup of the chains' signature Pike Place roast.

The continued expansion of the Reserve concept is interesting, given that the chain isn’t generally the first choice for serious coffee aficionados. Starbucks is, after all, more often equated with sugar bombs like Pumpkins Spice Lattes and Frappuccinos than it is with nuanced espresso shots.

But in recent years, Starbucks — largely credited with introducing Americans to better coffee — has faced increasing competition from more premium coffee rivals like Blue Bottle and Intelligentsia. The chain needed to do something to diversify beyond sugary drinks, something that would allow it to compete in the world of high-end coffee.

So, in 2014, the chain opened its first-ever Roastery and Reserve in Seattle, a 15,000-square-foot facility meant to appeal to those who want something more than hot milkshakes masquerading as coffee. In April, the company confirmed plans for a New York City outpost of its Reserve Roastery, and has also slated two locations for international markets.

At the Reserve Roastery in Seattle, Frappuccinos aren’t even on the menu. Instead, the sprawling store offers only brewed coffee and espresso using Starbucks’ small-lot Reserve coffees. There’s also a specialty beverage menu with items such as affogatos (Reserve espresso poured over locally made ice cream), pricey coffee gadgets, and siphon flights of Reserve coffees.

Still, some say the coffee itself isn’t all that tasty. The beans might be more premium, but it’s still a big-box coffee shop in disguise as a hip, premium roaster. There’s also, of course, the cool factor. Whereas Blue Bottle and Intelligentsia are decidedly hip, with modern decor and bearded baristas that take coffee maybe too seriously, Starbucks Reserve is basically just another Starbucks — albeit larger and much pricier.

Schultz describes the sprawling Reserve in Seattle as a "magical coffee ride.” Some Yelp reviewers, however, have called it “sterile,” a “grandiose waste-of-space,” and “a tourist trap for idiot rubes”:

But the chain’s new cafe-within-a-cafe concept, which marries those massive Reserve outlets with a traditional Starbucks store, will seemingly do double duty by appealing to two types of customers: those who want a more elevated coffee experience, complete with rare beans and knowledgeable baristas, and those who just want their Pumpkin Spice Latte.

• Starbucks Plans New 'Reserve' Targets in Super-Premium Battle [Reuters]
• Will Starbucks' Fancy New Concept Lure In Coffee Connoisseurs? [E]
• All Starbucks Coverage [E]