3. The Starbucks Story
1971 - Three friends opened a small shop
in Seattle
Initially sold fresh-roasted, gourmet coffee
beans and brewing and roasting
accessories
1982 – Howard Schultz joined Starbucks
1983 - Schultz travels to Italy, where he‟s
impressed with Milan‟s espresso bars
4. A Brilliant Epiphany that Transformed the
Coffee Industry
• Schultz attended an international
housewares show in Milan
• Fascinated with the exciting
coffee culture in Italy
• Sampled his first cafe latte in
Verona
• Impressed with the cafe
culture, fashionable coffee house
surroundings
• It was an “Aha‟‟ moment as
inspiration struck
5. Cafe Culture
• A brilliant Idea - "Why not
create gathering places like
the great coffee house of
Italy in the United States?"
• Baldwin – „Slow down!
We just sell beans‟
• Baldwin let Schultz test a
modest espresso bar in a
corner of one of the
stores.
6. • Schultz left Starbucks in 1985
to start his own coffee house
• Called his new venture IL
Giornale
• 1987 – IL Giornale acquired
Starbucks and changed the
name into Starbucks
Corporation
• 1992 – Starbucks went public
8. 1971-1987
Image of a mythical two-tailed mermaid
siren
coffee brown color scheme
symbolism represent the irresistible and
seductive quality of the coffee
1987-1992
Symbolize the melding of the two
companies
Color scheme → Coffee brown to the
familiar green
9. 1992-2011
Crops the image of the mermaid
with a close-up view
2011 -
No longer includes the “Starbucks
coffee”
Freedom and flexibility to think
beyond just coffee
The logo was designed to celebrate
the company's 40th anniversary
10. Bean There, Done That!
1971 – Starbucks Coffee, Tea and Spice Store opened in
Seattle‟s Pike Place Market
1982 – Howard Schultz joined Starbucks
1986 – Howard Schultz established Il Giornale
1987 – Il Giornale acquires Starbucks
1992 – Starbucks decertified the union and made IPO.
1995 – Starbucks Coffee International opens in Japan
1996 - Joins with Pepsi Cola to sell bottled Frappuccino
11. Bean There, Done That!
1997 - Establishes The Starbucks Foundation, benefiting local
communities
1998 - Acquires Tazo, a tea company based in
Portland, Oregon
1999 - Partners with Conservation International to promote
responsible coffee-growing
2000 – Acquired Hear Music, a San Francisco-based company
2002 - Enters into licensing agreements to sell Fairtrade
Certified coffee
2003 – Starbucks acquired Seattle’s Best Coffee
2009 - Becomes the largest buyer of Fairtrade Certified coffee
13. “We're not in the coffee business, serving people,
we're in the people business serving coffee”
- Howard Schultz CEO
14. “Employee First”
20 Hours+
• Generous Benefits
• Health Coverage
• Adoption Program
• Bean Stock
• Invests Heavily in Training
Programs
IN- STORE
• Shifts – Free Drinks
15. Training
• 25 Hour Program
→ coffee history
→ drink preparation
→ coffee knowledge
→ customer service
• A four-hour workshop called
“Brewing the Perfect Cup”
28. From Bean To Cup
• Centralized control over the entire
value chain
• Tightly-knit Structure
• Involved in each step of the value
creation process
• Personally chosen high quality beans
• Support center for farmers
• No franchising
• Starbucks stores – Consistent look &
feel
29. From Bean To Cup
• Baristas played a vital role
• Effective measures to
reduce customer‟s wait in
line
- No signatures for
purchases under $25
- Semiautomatic espresso
machines
- “Floaters”
• Altering store design
process
31. Challenges
2008 – Recession hits USA
Financial crisis
Starbucks' main problem is
overexpansion
Amount of store closures
No longer a monopoly
‘Coffee Wars’
33. Starbucks VS Dunkin Donuts
• Dunkin‟ donuts started its feud with
starbucks in 2007
• Launched an ad - “the delicious latte
from Dunkin' Donuts, you order it
in English, not Fritalian”
• In 2008 Dunkin‟ Donuts began
naming Starbucks in its ads
• DD proclaimed itself the winner in
a national taste test against Starbucks
• “It‟s just more proof that it‟s all
about the coffee (not the couches or
the music)”
34. Starbucks VS McDonalds
• „unsnobbycoffee.com‟
• “four bucks is dumb”
• To offer delicious
gourmet retail coffee at a
lower price than the
competition
35. The Hater’s Club
Subject of media jokes
Anti-Starbucks websites
„www.ihatestarbucks.com‟
Criticized by nutritionists
Frankenbucks Campaign
37. “The Way I See It”
„Starbucks has a history
of placing liberal, pro-
homosexual and anti-
God statements
submitted by
customers, celebrities
and other public figures
on the side of its coffee
cups for customers to
contemplate‟
38.
39. Same-Sex Marriage Advocacy
On January
12th, 2012, Starbucks
issued a memorandum
declaring that same-sex
marriage 'is core to who
we are and what we
value as a company.'
43. Environmental Impact
“Grounds for your garden”
Reducing the size of their
paper napkins and store
garbage bags
Implemented a water saving
solution
Recycled content in food
packaging
44. Fair Trade
“Fair” price for goods
Largest buyer of
Certified Fair Trade
coffee in North America
Introduced C.A.F.E
46. Music & Movies
• Hear Music - Starbucks' retail music
concept
• 2005 – selling over 3.5 million CDs
a year
• Produced a CD "Memory Almost
Full“ by Paul McCartney
• Producers of the 2006 film Akeelah
and the Bee
• Bookselling debut with „For One
More Day‟
47. Partnership With Apple
Selling music as part of the
"coffeehouse experience“
Apple added a Starbucks
entertainment area to the
iTunes store
49. The Brand Excels At Delivering Benefits
Customers Truly Desire
• Not just a “Perfect cup of coffee”
• 87,000 drink combinations
• Appeals to all the five senses
- Enticing aroma of beans
- Rich taste of coffee
- Product display & artwork
- Music in the background
- Cozy atmosphere
9/10
9/10
“A great brand is a story that’s never completely told.”
50. Brand Stays Relevant
• Commitment to their core values
• Understands the tastes and
expectations
• Highest level of customer service
• High quality product
• “Third Place”
• Packaging innovation
• “Flavor innovation”
• Latest processing technology 9/10
'A brand name is more than a word. It is the beginning of a
conversation.'
51. The Pricing Strategy Is Based On Consumer’s
Perception Of Value
• Starbucks sets its prices on a simple
idea - high value at moderate cost
• Strict quality controls in its coffee
sourcing & customer service
• Positions itself as an authority on
coffee
• A lot of time and energy
differentiating itself
8/10
• Starbucks also uses relative pricing
“The price of anything is the amount of life you exchange for it”
52. Brand is properly positioned
• “Romance and Theatre”
• Creates an air of
comfort, relaxation, familiarity, exclusivit
y
• POP - Great-tasting
Coffee, Reliability, Speed, Convenience
• POD – Rich Sensory Experience, Exotic 9/10
Coffee, High Quality, Exceptional
Service
“Give them quality – that’s the best kind of advertising”
53. Brand is consistent
• Starbucks stores have used the same
design, furniture and “look and feel”
• Guarantees the same experience in every
store
• Starbucks london to Starbucks
Malaysia, the same model is used, the
same coffee, and the same machines
• Consistently good customer service
9/10
“Consistency builds trust and trust is what will lead you to a loyal
customer”
Editor's Notes
Starbucks doesn’t only sell coffee, they sell a third-place environment; not home, not work, but Starbucks
Starbucks is involving the Twitter community in an online photography scavenger hunt, offering prizes of Starbucks Gold Cards for Twitterers who can photograph posters from the most recent US outdoor campaign and post them online including the phrase #top3percent rules. The full-page newspaper ads go to some length to describe how Starbucks selects only the best 3 percent of beans and roasts them until they pop twice, and gives its part-time workers health insurancethe spirit of using social media as a marketing tool, launched a big campaign where it hid posters around 6 major US cities and challenged the public to find the posters, take photos, then post them to Twitter using hash tags Starbucks created for the campaign.
crowd-sourcing quality information for the purpose of business developmentbrand awareness and customer engagement
Starbucks likes holidays and is always ready to dedicate new charity initiatives to the big dates’ celebration. Now the big coffee brand is promoting its Red Love campaign with the help of social and owned media and wants to drive more consumers to the outlets to gain more money for the Red Cross.The aim is to raise as much money as possible for Global Fund-financed AIDS programs.
dearth of innovation, market saturation and poor control over restaurants. Prices for food commodities are at all-time highs, prompting the firm to increase prices twice in the past year. This has scared off customers, who have been defecting to fast-food chains such as Dunkin' Donuts or Panera Bread, which sell reasonable coffee for as little as a quarter of the price of a fancy Starbucks brew
test was held in ten major US cities, including Los Angeles, where Dunkin’ Donuts does not have a single store, and Seattle - Starbucks' hometown. Dunkin’s triumph in this challenge lead to a massive campaign covered by TV, radio, print, outdoor, online, in-store, special events and sports advertisements in which slogans such as The Truth Is Out, Hate To Say I Told You So and Friends Don’t Let Friends Drink Starbucks were plastered everywhere– even proudly displayed on the T-shirts of the stores’ employees http://www.youtube.com/watch?v=r2y_GwKzxck
really wanted to point out that ordering an espresso at McDonald's is quick and simple. Small, medium and large. It's easy."
NOM, the National Organization For Marriage, has gone too far this time, rolling out a new campaign claiming — lying — that Starbucks wants to eliminate traditional marriage.
- premium items like its espresso drinks & lower price items like drip coffee