Starbucks and Chick-fil-A Drop Out of the Culture Wars

(Bloomberg Opinion) -- Their origins couldn't be more different -- one in the liberal Pacific Northwest, the other in the Bible Belt. And yet despite existing in a consumer brand landscape increasingly caught in the same polarizing trends seen in our politics, Starbucks Corp. and Chick-fil-A Inc. are converging on the exact same customer base, shaping what middle America means in the 21st century..Succeeding as a consumer brand in the 2010s is impressive in its own right; doing it while pivoting from a distinct cultural base to something more universal is even more challenging when considering larger trends in American business. We've seen media networks sort into outlets that cater to either liberals or conservatives. Pro sports leagues have dealt with the same issues, with the National Basketball Association and Nascar moving in opposite directions. Even a clothing staple as innocuous as blue jeans has seen San Francisco-based Levi's cater more to liberals while Wrangler has trended toward conservatives..Starbucks and Chick-fil-A are different. The No. 2 and No. 3 U.S. restaurant chains have dealt with their share of cultural controversies during the past several years. They have done it by slowly but steadily pivoting away from their regional origins..For Starbucks, the challenge was expanding from its roots in Seattle with an urban, liberal, largely white brand identity to something more universal. The company didn't come to Manhattan until 1994, 23 years after its founding. During that time it moved into cities in the rest of the U.S., then urban areas overseas. With the cities conquered, suburbs were next, which meant drive-through windows for car-centric middle America and adding food and cold beverages to cater to a wider range of tastes and preferences..Being a universal brand requires a universal culture. So, for example, in 2015, Starbucks removed all graphic designs associated with Christmas from its takeout cups, replacing them with plain red holiday cups, leading to brief and now-forgotten backlash. In 2018, after store employees in Philadelphia complained to police, two black men who were waiting to for a business associate were arrested when they asked to use the bathroom. The episode led the company to close all of its stores for a day to conduct diversity training. .For Chick-fil-A, the challenge has been to evolve from a company whose culture is heavily influenced by the religious ethos of its founder, a devout Southern Baptist. As with Starbucks, geographic expansion came before cultural change. As recently as 2013, Chick-fil-A had more locations in Alabama than it had on the entire West Coast, and it had little presence in the Northeast. Liberal consumers and those outside of the South held negative view of the company because of its opposition to same-sex marriage, with company president Dan Cathy defending his position in 2012. That led to boycotts, which eventually ended when the company reversed its stance a couple months later..Expansion outside of its core geographic market continued, with Chick-fil-A's first New York store opening in 2015. While sales growth has remained robust, the company couldn't shake its image as a foe of LGBTQ rights. It's in that spirit -- perhaps after the planned closure of its first store in the U.K. amid gay-rights protests -- that the company earlier this month said it would change its philanthropic policies to placate the demands of activists..The company has moved in a cosmopolitan direction in other ways. It expanded its menu to include options like cold-brew coffee and bowls featuring kale and quinoa. Its marketing has also shifted to emphasize diversity and a recent television ad featured a voiceover of a man with a Hindi accent. Although it still has work to do to conquer North America, it's clear that Chick-fil-A has ambitions abroad, and doesn't want cultural obstacles to get in the way..If corporations used to define middle American consumers in the past as white Christian families in the Midwest, Starbucks and Chick-fil-A seem to suggest an updated version is taking form that defines the market with broader demographic sweep and that includes consumers in cities, suburbs and exurbs across the nation. People of all backgrounds are welcome. Religion is de-emphasized. In our polarized environment, there may not be many institutions that most or all Americans can embrace, but it look as if coffee and chicken sandwiches may turn out to be the exception. .To contact the editor responsible for this story: James Greiff at jgreiff@bloomberg.net.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners..Conor Sen is a Bloomberg Opinion columnist. He is a portfolio manager for New River Investments in Atlanta and has been a contributor to the Atlantic and Business Insider..©2019 Bloomberg L.P.

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Starbucks and Chick-fil-A Drop Out of the Culture Wars

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