mornin' merrymakers ☕️🛍️✨

i've spent this summer walking neighborhoods & malls in different cities across the coasts. i keep on seeing the same thing.

the coffee shops are packed.

the stores are not.

there's a line out the door around the corner for a $10 latte. every table taken. crowds hovering hoping to snag an open seat.

then i walk next door where i find three employees, twelve perfectly folded sweaters, & zero customers.

retailers have noticed this too. & somewhere along the way, a lot of them landed on the same conclusion…

maybe we should add a coffee shop to our store.

ralph lauren has ralph's coffee. rh has restaurants. target has starbucks. fashion brands are opening cafés. furniture stores are serving cold brew. athleisure brands selling matcha.

no one tracks every espresso machine hiding inside a store, so there's no clean global number. but the retailer-level evidence stacks up.

target had 1,097 in-store starbucks in 2012. by 2023, more than 1,700. run those against target's own store counts & you go from roughly 62% of stores with a starbucks to roughly 87%.

rh had eight galleries with hospitality in early 2020. by february 2025, 21.

or better yet just walk around the west village in the nyc.

retail is clearly caffeinating.

so let’s chat why (& why it’s concerning…)

if you're trying to get people to walk into your store, coffee looks & smells appealing.

most retail categories have a frequency problem. you buy a couch every seven years. a blazer every few months. a book every couple of weeks.

people buy coffee every. single. day.

so instead of waiting for someone to wake up on a tuesday desperately needing cashmere, you hand them another reason to walk in. come get a latte. maybe you browse. maybe you buy. maybe you remember them next time you actually need a couch.

you can picture the powerpoint slide:

$10 latte → incremental visit → brand exposure → future purchase → lower cac

[fyi cac stands for the the cost of acquisition for a customer & is dearly beloved term of ecommerce brands]

there's evidence that this works… kinda

at todd snyder, traffic counters found roughly 30% of café customers also visited the retail store. the café itself generated about 10% of store revenue

shoppers who eat during a trip also stay longer & spend more. one jll study clocked an extra 35 minutes at the property & 12% more sales revenue.

coffee creates traffic. traffic creates exposure. exposure creates customers.

this could easily make one think that coffee = cac.

except….

30% of todd snyder's café customers walked into the store.

which means 70% didn’t. they bought coffee & left.

that distinction is the whole ballgame.

retailers have spent years treating foot traffic as a proxy for success. thinking more bodies through the door means longer dwell time, more occasions, make the store a destination.

worth measuring. but a person standing inside your four walls is not a customer. a coffee transaction is not a relationship with your brand.

acquisition only counts if you're acquiring someone who eventually wants to buy your core products.

this is the wildest part of the strategy to me.

i consider myself to be someone with above average knowledge about coffee. i'll detour in any city for a really good single origin pour over. i consistently find that many businesses whose entire reason for existing is making coffee still let me down.

so when a clothing company decides

“you know what else we should operate?”

“food service!”

...i tilt my head in confusion…

the drink itself carries an okay gross margin. but when you factor in labor, equipment, utilities, cleaning, spoilage ,& occupancy the margins get rapidly reduced.

some retailers are learning this the expensive way.

sainsbury's, one of the uk’s largest supermarket chains, moved to close around 200 in-store cafés in 2022, then proposed shutting its remaining 61.

another major uk grocer with a long history of in-store cafés, morrisons closed another 52 in 2025, with costs its ceo called “significantly out of line with usage, volumes or the value that customers place on them."

the better question is why retailers want cafés this badly in the first place.

my theory is that stores are desperate for traffic.

ecommerce made buying easy. so if the primary job of your store is helping me acquire a product, i don't need the store. i can buy the thing from my couch.

which leaves retailers manufacturing reasons for me to show up anyway. put in a café. add a bar. host a dj. give a free tote bag.

none of that is bad on its own. it just becomes an elaborate workaround for an uncomfortable problem…

people don't have enough reasons to visit your store.

& instead of fixing that, brands are adding second business.

it's the retail equivalent of having relationship problems & getting a puppy.

brands havee gotten obsessed with transactions. traffic. conversion. aov. units per transaction. sales per square foot.

all worth knowing. all measurements of what happened today.

the more interesting question:

the best stores build relationships. they introduce you to people, teach you something, remember your name. they make you feel like part of something.

they create the one thing the internet & ai will never be able to:

belonging.

coffee shops have excelled at this for decades. yes, you go for the caffeine. but think about your favorite one. you don't love it because the extraction is 11% better than the place down the street.

you know the barista. you recognize the regulars. you have your table. you meet friends there, work there, read there. your dog pulls you in for treats there. you have a habit there. you have memories there.

the coffee is the transaction. the relationship is the product.

that's the part retailers should steal from the coffee shops, not the lattes.

too many stores operate like a place for a purchase.

enter. get what you need. pay. leave.

maybe we speed up checkout. maybe we put something tasty by the register. the interaction stays transactional.

& if that's all a store offers, ecommerce wins.

i believe that physical retail can do something bigger & better the world. by becoming the place where relationships accumulate. between customers & employees. between customers & brands. & most importantly, between customers & other customers.

the future of retail is stores that want you to come back to again & again.

& there's a world of difference between putting coffee in your store & building a place people want to belong to.

coffee might help with the second. but it can't substitute for it.