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Location Innovation

November 24, 2011

I was driving north on Van Ness in San Francisco when I saw a large Starbucks sign at the intersection with California. I swerved over and parked so that I could run in for a latte. When I got to the door, I was confused: The sign didn’t read “Starbucks.” It read “Wells Fargo.” I saw people coming out with the familiar white and green cups so I ventured inside.

What I found was a colocated coffee shop and bank branch. To the left were the familiar baristas and carefully displayed bags of coffee; to the right were tellers, loan officers, and the stands of brochures one typically finds in a bank. They shared the same decor. Aside from the space left for a walkway between the two, it wasn’t clear where one ended and the other began.

This concept is not new, though it was new to me. The idea of a joint retail offering between the two goes back to 1997. But what a great idea. A steady stream of caffeine seekers provides a flow of prospects for the bank. Bank customers can be lured to make an impulse purchase at Starbucks that they might otherwise not have made.

Neither company has information on the joint locations (at least when you search on the other’s name on their respective web sites) and doesn’t seem to have gone beyond a regional pilot. If you have any information on the success (or lack thereof) of this colocation arrangement, please let us know.

At our annual Burning Questions conference we often use the following question as a table topic at the opening dinner: If you could merge two companies to transform an industry, what would they be? The example I use is Dunkin’ Donuts and UPS. With that combo, your packages could arrive with hot coffee and a donut. The bank/coffee shop is the one I’ll use from now on.

Let me put that question to you: What interesting, innovative colocating ideas do you have that could potentially transform an industry — or two?

Eric McNulty

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