I have a Dutch Bros within ten minutes of my apartment in Dallas and a Starbucks within ninety seconds. I drive past the Starbucks twice a week to get to the Dutch Bros. That is not a marketing observation. That is a marketing diagnosis.
If you are running a brand right now and you cannot explain why a customer would drive past your closer competitor to get to you, you do not have a brand. You have a habit waiting to be broken.
§ 01 — Starbucks has customers. Dutch Bros has fans.
Starbucks is, by every quantitative measure, the larger and more successful company. Forty thousand stores worldwide. Tens of billions in annual revenue. A loyalty program that is, by membership, larger than the GDP of several small countries. Nobody is arguing with the scale.
But scale is not the same as relationship. Starbucks has won the convenience war so completely that for most of its US customers the relationship is no longer about the coffee, the people behind the counter, or the brand. It is about proximity. Starbucks is the store that is there. The store next to your office. The store on your commute. The store that won.
The cost of winning that way is that there is no longer anything to love. There is nothing to choose. The customer has not chosen Starbucks for years. The customer has been routed to Starbucks by the geography of their own day, the same way they are routed to whichever gas station happens to be on the off-ramp. The brand has, somewhere in the last decade, become infrastructure.
Infrastructure is profitable. Infrastructure is also defenseless against a brand the customer would actually drive past you to reach.
§ 02 — What Dutch Bros gets right
I have watched the Dutch Bros parking lot in north Dallas at 7:45 AM. The line wraps around the building. The cars are not patient — they are cheerful. People are scrolling, sipping yesterday’s water bottle, occasionally smiling at the broista who has come out to take orders on a tablet. I have never seen a Starbucks line do that. I have seen a Starbucks line, but it is being endured.
What Dutch Bros has done — and what Starbucks structurally cannot do anymore — is build the brand on hospitality rather than convenience. Every interaction with the front-of-house team is slightly warmer than it has any right to be. The broistas remember regulars. They remember the order. They ask follow-up questions about the dog you mentioned on Tuesday. The drink is fine; the drink is not the point. The point is that for ninety seconds, somebody is treating the transaction as a small relationship rather than a small inconvenience.
And then there is the loyalty program, which is the part I want every marketer reading this to study. The Dutch Bros app is not selling you stars-toward-a-free-coffee in the punch-card-with-a-tech-veneer way Starbucks Rewards has done for twenty years. It is selling you membership in a smaller, more emotionally specific tribe. Sticker drops. Stop-and-share moments. A loyalty tier called Dutch Rewards that, frankly, behaves more like a fan club than a coupon system.
The math is unambiguous. Dutch Bros has grown its store count rapidly across the western and southern US. Same-store sales growth has consistently outperformed comparable chains in the same windows. The customer behavior the chain produces — frequency, basket, repeat — is what every quick-service brand in America wishes they had. They didn’t get it by being closer to the customer’s office. They got it by being warmer than the alternative.
§ 03 — The Starbucks problem, named
Starbucks’s current problem — and the leadership transitions of the last several years suggest the company knows it has one — is that the chain has spent two decades optimizing for throughput, mobile order, and consistency at scale, and somewhere in that optimization, the hospitality that built the brand evaporated.
Howard Schultz returned to Starbucks in 2022 with a public memo essentially saying this himself — that the company had drifted from its “third place” identity and needed to rebuild the in-store experience. It was a remarkable thing for a founder to publish, and it has barely moved the actual store experience two years later, because the structural pressures that hollowed out the hospitality layer — mobile order volume, throughput targets, labor scheduling — are still there. Diagnosing the disease is the easy part. Treating it requires backing off the throughput optimization, and no public company quarter-on-quarter optimizer is going to do that voluntarily.
The “third place” promise — the original positioning that made Starbucks a brand and not just a store — was a hospitality promise. Comfortable chairs. People who’d remember your name. A space that wasn’t home and wasn’t work. You can argue about whether that promise was ever fully delivered, but you cannot argue that the current Starbucks store, with its mobile-pickup pile, its disappearing furniture, and its baristas drowning under the volume, delivers it now.
What’s left is a beverage company with a logo on it. Beverage companies are commodity businesses. Beverage companies compete on price and proximity, which is exactly what every quick-service competitor is going to take from them in the next decade, while a younger, regional, hospitality-first chain like Dutch Bros eats the loyalty layer that used to be Starbucks’s moat.
§ 04 — The lesson, for non-coffee people
If you do not work in coffee — and most of you don’t — the lesson is not about coffee. The lesson is about which kind of relationship your customers have with your brand, and whether that relationship can survive the next competitor who shows up with a better one.
Ask the uncomfortable question: would my customers drive past my closer competitor to reach me? If the answer is yes, you are building something. If the answer is no, you are running a habit. Habits are durable until they are not. The day a hospitality-led competitor moves in across the street, the habit breaks, and you have nothing left to spend on the customer except discounts. Discounts are the last thing a brand without a relationship has.
The brands I watch closely right now — the ones I think will still matter in ten years — are the ones building emotional specificity into the customer experience. Trader Joe’s, where the cashier asking about your week is policy, not personality. Costco, whose hot dog has been $1.50 since 1985 not because the math works but because the math is no longer the point — the customer’s belief that Costco is on their side is the moat. Chick-fil-A, whose “my pleasure” script is mocked online and is also why the drive-thru lines are twice as long as KFC’s at lunch. In-N-Out, which has had the same five-item menu for seven decades and refuses to franchise. The early Sweetgreen, before it became a logistics company that also sells salads. Selfridges. The good independent bookstores. None of them are competing on price. None of them are competing on proximity. They are competing on the part of the brand that lives inside the customer’s head and refuses to be replaced by a cheaper version of itself.
§ 05 — The take
Starbucks has customers. Dutch Bros has fans. The two are different in ways that take twenty years to fully manifest in the share price, but they are different from day one in the parking lot. You can feel the difference at 7:45 AM with a line that is, somehow, cheerful.
If you run a brand and you want to know whether you are Starbucks or Dutch Bros, the test is simple. Stand in your store at the busiest moment of the day. Look at the customers’ faces. If they are tolerating you because you are convenient, you are Starbucks. If they are excited to be in line, you are Dutch Bros.
One of these will outlast the other. I drive past a Starbucks twice a week to get to a Dutch Bros, and I’m a thirty-something marketer who is theoretically immune to a sticker drop. They got me anyway. That’s the brand.
I’ll be at the drive-through. The lime green cup is not a coincidence on this blog. Take notes.