Starbucks Back To Basics 11.16


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Here\'s a quick overview of how Starbucks went "back to basics" and re-focused all their efforts on coffee

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Starbucks Back To Basics 11.16

  1. 1. Starbucks: Back to BasicsA look at what they did to revive their “neighborhood coffee shop” appeal in the US November 2011 1
  2. 2. OverviewHow did they get back to basics? Barista Training New Products Inspire Shareholders Engage Management Close Locations New Advertising New Packaging In-Store Design 2
  3. 3. Back to Basics: Baristas• In February 2008, Starbucks closed 7,100 of its American stores at precisely 5:30 pm for a 3-hour retraining session for employees.• Baristas practiced dispensing espresso into shot glasses, checking the color of each shot, and paying attention to the particularities of steaming milk.• Each training session included a "This is not about training, this is video message from CEO Howard about the love and compassion Schultz about the various and commitment that we all operational changes and need to have for the customer.” improvements. – Howard Schultz, CEO 3
  4. 4. Back to Basics: Baristas Take the time to Re-Train and Re-Focus on what matters for your brand 4
  5. 5. Back to Basics: Inspire ShareholdersOur Aspiration:To become an enduring, great company with one of the mostrecognized and respected brands in the world, known forinspiring and nurturing the human spirit.SEVEN BIG MOVES1. Be the undisputed coffee authority2. Engage and inspire our partners3. Ignite the emotional attachment with our customers4. Expand our global presence – while making each store the heart of the local neighborhood5. Be a leader in ethical sourcing and environmental impact6. Create innovative growth platforms worthy of our coffee The Seven Big Moves were declared to share holders in7. Deliver a sustainable economic model March 2008 5
  6. 6. Back to Basics: New Products• In April 2008, Starbucks launched a new coffee called “Pike Place Roast” – a smoother roast made mostly from Latin American beans and based on one of the chain’s earlier blends.• The blend is named after the iconic market in Seattle, where the chain first started out, and aimed to appeal to the broader McD/Dunkin coffee drinker. 6
  7. 7. Back to Basics: New Products• In the 2008 Barista training, employees were reminded that the chain was getting rid of “odoriferous breakfast sandwiches” so customers can smell the coffee again.• The food team discovered that improving the quality of the ingredients – leaner bacon, better ham and cheese – helped reduce the aroma.• Sandwiches were re-launched in June 2008 with Ciabatta bread and a lower baking temperature. 7
  8. 8. Back to Basics: In-Store Design• As the brand solved the issue of the burnt cheese smell, they worked to restore the coffee shop aroma.• The drink preparation is more prominent. New, lower machines allow guests to see their drinks being prepared by the baristas.• Additional design elements of burlap bags and coffee beans in addition to freshly ground coffee beans brought the stores back to their true focus – great coffee. 8
  9. 9. Back to Basics: In-Store Design• Although not yet in national distribution, Starbucks is looking into a new brewing system that attempts to bring espresso-like involvement to drip coffee.• “The Clover® brewing system uses innovative Vacuum-Press™ technology to create your cup right in front of you. You watch as a stainless steel filter lowers into the brew chamber. Hot water is added at a precise temperature to brew your coffee for an ideal length of time…” 9
  10. 10. Back to Basics: In-Store Design• Re-hired Arthur Rubinfeld to redesign the stores, using color, layout and design to “recapture the coffeehouse feel”• Replaced all outdated POS computer systems, and scaled back on books and music – focus on coffee• Created a customer rewards card to encourage the core user• Appointed Chris Bruzzo from Amazon to kick online and social efforts into high gear Costcos CEO once said: “losing customers in a down economy is much more expensive than investing in them.” 10
  11. 11. Back to Basics: Close Locations• In July 2008, Starbucks announced that it would close 600 US stores that year.• In the process of the store closings, more than 12,000 employees were laid off, the most in company history.• The closings were part of the brand’s effort to recapture growth and counter general economic troubles, and helped cut $850million in costs 11
  12. 12. Back to Basics: Engage Management• In October 2008, Starbucks held a leadership conference in New Orleans for company employees and managers.• It served as a way for them to become re-acquainted with the basics of the brand – even offering samples of the chain’s espresso and specialty blends. 12
  13. 13. Back to Basics: New AdvertisingStarbucks selected BBDO as their agency of record in the Fall of 2008, and released this ad sharing their thoughts on the importance of exercising the right to vote. 13
  14. 14. Back to Basics: New Advertising• In May 2009 Starbucks launched a new print campaign in response to the coffee competition from McDonald’s and the 8% decrease in same store sales during the first 3 months of 2009.• The aim was to tell its message to a new generation of coffee drinkers and then recruit them to retell the story online.• The advertising effort which included outdoor, newspaper, and magazine, was the biggest marketing effort Starbucks has undertaken. 14
  15. 15. Back to Basics: New Advertising The print campaign was seen in 6 major US cities 15
  16. 16. Back to Basics: New Advertising 16
  17. 17. Back to Basics: New Advertising 17
  18. 18. Back to Basics: New Advertising 18
  19. 19. Back to Basics: Baristas• Additional barista changes in October 2010 aimed to increase the beverage quality, even at the expense of speedy service.• Baristas should focus on no more than 2 drinks at a time and steam milk for each drink rather than a pitcher for several beverages.• Other instruction include rinsing pitchers after each use and using only one espresso machine instead of two . 19
  20. 20. Back to Basics: New Packaging• The packaging for the Pike Place Roast uses the traditional brown label with an old version of the Siren logo.• The new wordless logo revealed Jan 2011 aimed to suit the company’s expansion beyond coffee into a wider array of business lines and into Pike Place Roast Website international markets. 20
  21. 21. Back to Basics: In-Store Design• July 2009 began the test launch of the Starbucks’ 15th Ave E Coffee & Tea Store. 15th Ave E Coffee &• The idea was to create a coffee shop that had Tea Store the name of the neighborhood, rather than the Location at Capitol 16,000 store chain which they belong to. Hill in Seattle• The overall project aimed to give the stores a “community personality” and capture the spirit of a traditional coffee house – serving wine & beer, hosting live music an poetry readings.• The test ended in January 2011 with a new sign and the return of the Starbucks logo and equipment to the 15th Ave east Location, but the store got to keep its new décor. 21
  22. 22. Back to Basics: In-Store Design 22
  23. 23. Back to Basics: In-Store Design 23
  24. 24. Back to Basics: In-Store Design 24
  25. 25. Back to Basics• In order to get back to basics, Starbucks shifted their focus from selling CDs, mugs, and speedy drinks to what really matters for their brand – Best Tasting Coffee.• If KFC wants to mirror their path, it’s time to shift the focus from one off product tests back to what makes them relevant – Fresh Chicken. 25
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  27. 27. Back to Basics: Timeline2008 2009 2010 2011 • System Wide • New Print • Barista • New Logo Barista Training Campaign operational Introduced • Pike Place Roast Launched changes to • 15th Ave E Introduced • 15th Ave E improve Coffee & Tea • New Breakfast Coffee & Tea drink quality Store re- Sandwiches Store branded as a • Declare 7 big Opened Starbucks moves to shareholders • 600 Stores Closed • Ad for November Election 27
  28. 28. Articles“Back to Basics for Starbucks Baristas” (2/27/2008)“Starbucks Announces It Will Close 600 Stores” (7/2/2008)“New Starbucks Ads Seek to Recruit Online Fans” (5/18/2009)“Starbucks tests New Names for Stores” (7/16/2009)“15th Avenue E Coffee & Tea by Starbucks Coffee Co” (7/23/2010)“At Starbucks, Baristas Told No More Than Two drinks” (10/13/2010)“New Starbucks Logo Unveiled” (1/5/2011)“The Saga of the Stinky Cheese” (3/13/2011) 28