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June 26, 2004 - Subscribe - Contact Us - Rate Card - Place an Ad Valley&State Backpage O&E Sports Archives Classifieds Faith&Beliefs Obituaries Revels April 17, 2004 Is a coffee war brewing? Coffee is brewing at a fast and furious pace in Ashland. Last month, the town welcomed a new Dutch Bros. Coffee drive-through, and the end of this month, a new Starbucks is scheduled to open at the former Leo's Bistro Grill & Coffee Bar on Siskiyou Boulevard next to Southern Oregon University. The lines for a great coffee battle appear to be drawn along Siskiyou Boulevard and Ashland Street. Starbucks is coming soon to this site on Siskiyou Boulevard. Denise Baratta/Ashland Daily Tidings But the inevitable clash of coffee captialism may not necessarily be the end result. One thing officials from both the new Dutch Bros and The Beanery, the mainstay of the area, say they are not concerned. Both feel they serve a distinct community niche that will not lessened by the incoming coffee giant. Too much? A stream of workers busily prepares the finishing touches to the third Ashland Starbucks. The Seattle-based coffee company already has a store downtown and a location inside Albertson's. Expansion is nothing new for Starbucks. The company started with one store in 1971 in Seattle and has since expanded to more than 7,569 locations across the world. The company is unabashed in its desire to convert the world into coffee drinkers. They openly court those who might not be consistent coffee drinkers, hoping to make them enjoy any coffee, not just their own, said Steve Ogo, Southern Oregon district manager for Starbucks. Starbucks workers frequently travel from table to table like coffee missionaries, offering free samples to customers. "It really allows us to talk to people and make them more comfortable about coffee," Ogo said. "There is a lot of education that goes to our employees and that continues to our customers." The latest location is a direct response to the wishes of existing customers, many of whom are college students who wanted something near the university. When the facility that used to be Leo's Bistro closed, Starbucks grabbed the location. But some coffee drinkers from the college remain unimpressed. Some say they get coffee cheaper at home, while others say they intend to remain loyal despite the new addition. Coffee drinker Remy Morri, a senior at SOU, said even with a location near SOU, she may go only once in a while. "I don't like the coffee they serve or the service so much," she said. "I always get a stomach ache. I'm not anti-Starbucks, it's about the coffee for me. I like Dutch Bros. though. They're fast and super, super friendly and the coffee's good." Coffee converts Despite offering an alternative choice to the coffee customers of already established businesses, Ogo asserts that Starbucks can be a positive addition. "We actually increase the pie instead of taking a chunk, so everyone gets more," Ogo said. "More people feel more comfortable trying coffee and it creates a coffee drinker that wasn't there before." A September 2002 Wall Street Journal article supports Ogo's point that a Starbucks is not necessarily a bad thing for local coffee houses. The article featured a Kansas City, Mo., coffee house and its customers who were worried when a Starbucks moved in next door. Four years after Starbucks opened, the local coffee house remained open and sales had increased. And in Seattle, Tully's Coffee Corp., has developed a strategy of placing stores near Starbucks shops. The article cited a study by Mintel Consumer Intelligence, a Chicago market-research firm, which found that independent coffee houses accounted for more than half of the industry's growth between 1996 and 2001 nationwide - with independents and small chains boasting a 61-percent share of the industry. 'What's Starbucks?' So perhaps its not just false bravado presented by the workers and owners of the other area coffee shops who say they are unconcerned. "Starbucks? What's Starbucks?" quipped Saba Moon, manager of The Beanery. "People who come here are not going to be steered away by a Starbucks," she said on a more serious note. "That's just on our coffees alone, and then you have our fresh baked goods, the food and the atmosphere. It's their home away from home. We get people from all ages and all walks of life because we have been here for so long and offer a quality product. We have a niche here." The store offers more than 40 varieties of coffee, many kinds of teas, breakfast foods, sandwiches, quiches and burritos. To Moon, Ashlanders will stick to their local coffee houses. "Corporations like Starbucks are never going to be part of Ashland, and we are," she said. "I think people in Ashland are the kind of people who want to support local things and that's what we're about here." Coffee and Ashland are perfect mix and that's why there are several local coffee houses in town, Moon said. The Beanery has nine locations in Oregon, but customers see it as a locally-owned store because this location is the first for the chain. It opened 32 years ago, prior to the owner moving the corporate headquarters to Albany. Rapid expansion Starbucks is very well known to Charles Jaeger, professor of marketing at Southern Oregon University. He has assigned many discussions, presentations and papers on the coffee giant. He has also used Starbucks in his courses on domestic and international marketing. "Starbucks has been very aggressive in expanding globally, and in the United States, it's the market leader," he said. Last month, a student group did a presentation on Starbucks. And one of the questions was, "Should Starbucks build a third location in Ashland?" Most students said was there was room for another Starbucks in town, though some disagreed. The dissenters expressed concern that Starbucks was "kind of dominating local companies and putting them out of business," he said. "But I think the little [shops] are doing quite nicely. The number of coffee houses for the size of this town is above average." Its no surprise to Jaeger that there are high percentage of coffee drinkers here. "This town is pretty unique and cosmopolitan," he said. While Jaeger agrees with Moon that each coffee house has its own loyal following, that doesn't necessarily mean a new Starbucks won't hurt any of them. The power of Starbucks' name recognition and marketing could cause some to switch their loyalities to the new location. No worries Dutch Bros. pins its hopes for success on still another distinct coffee concept that, officials believe, will weather another Starbucks in the area. "We've got our own clientele of drive-through people," said Ty Sullivan, owner of the new Dutch Bros. drive-through in the Ashland Shopping Center. "I don't care that Starbucks is only a block away - it doesn't have an impact on us. People who go to the Starbucks [on Siskiyou] want to relax. People who are getting our coffee are on their way to somewhere. The guy who is going to go to Starbucks, who will sit down, grab a paper, and have all their fancy pastries is going to go there regardless, and the guy who is going to work is going to go to our place." Jaeger agreed that coffee kiosks like Dutch Bros. don't compete directly with coffee houses like Starbucks. "People go to places like Starbucks for other reasons, like the experience," he said. "If they just want a cup of coffee, it's a lot more comfortable to go through a drive-through." So for now the shots of a brewing coffee war remain unfired as each seeks to bring their own brand of customer under its own label. If Starbucks truly adds to the number of coffee drinkers, their may indeed be enough drinkers to go around. 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