Starbucks is launching its first on-campus store called the "Campus Cafe" at New York University in September 2015. The store aims to tap into the $3 billion higher education market by offering coffee and food tailored to student tastes. It will also employ students and offer scholarships. Starbucks sees the academic market as its final frontier and hopes a successful NYU location will pave the way for expanding to other college campuses. It is developing a communications plan to promote the new store to the NYU community and build awareness of the Campus Cafe concept among potential academic clients and the general public.

1. Starbucks Goes Back
to School

2. 2
Starbucks: Background
• Starbucks is one the most successful
brands of our time.
• Starbucks reinvented coffee - its rise, not
coincidentally, coincides with an increase in
coffee drinking worldwide.

3. 3
Changing Consumer Habits
“Starbucks made coffee about more than just
having a morning cup o' joe - it meant paying $4
and change for your morning coffee and having
it iced, whipped, soy, shaken and nonfat with a
touch of whipped cream and sprinkles.”

4. 4
Starbucks: Background
• Starbucks has 10,000
locations worldwide
and serves more than 35
million customers each
week.
• Company is growing again
worldwide after difficult
consolidation period and re-
emergence of Howard
Schultz as CEO.

5. 5
Starbucks: Background
• Stock has been exploding to
the upside in recent years.
• Analysts say stock surge
looks poised to continue.
• Recently announced record
earnings.
• Big growth in China and
online.

6. 6
Starbucks: Background
Source: YCharts

7. 7
Starbucks: Background
Source: YCharts

8. 8
Recent Earnings

9. 9
Recent Earnings

10. 10
Under Pressure
• Starbucks still faces
considerable pressure from:
– Weak global economy
– Perception on Wall Street
that its business is “mature”
with limited growth
opportunities.
– Uncertain nature of dairy
and coffee ($2+/pound)
prices
– Cost pressures
– Challenges from McDonalds
and other fast food chains.

11. 11
Under Pressure
• Has not yet directly
penetrated academic
market.
• Academics plays well with
the company’s social
responsibility platform.
• Starbucks needs investor
capital to finance its
international expansion
plans.

12. 12
Cracking Higher Education
• Academic market represents a $3 billion
opportunity.
• The company will build/open its first pilot store
at New York University in September, 2015.
• It will be called the “Campus Café.”

13. 13
Cracking Higher Education
46 West 14th
Street

14. 14
Cracking Higher Education
46 West 14th
Street

15. 15
Cracking Higher Education
• Campus Café will offer coffees
tailored specifically for student
tastes - including a selection of
extra strong brews that have
extra caffeine.
– Music that appeals to
students.
– Store will be open 24-7.
– Managed by Starbucks.

16. 16
Cracking Higher Education
• Store will employ six
students as part-time
employees.
• Students must maintain
a 3.5 GPA to work at the
store.
• Starbucks will purchase
land, air rights from
NYU, and establish a
scholarship fund for
employees.

17. 17
Cracking Higher Education
• Will establish “Starbucks
University” branch of
Stern Business School
for high potential
employees who want to
pursue MBAs.
• Starbucks will
underwrite tuition costs
and provide
scholarships.

18. 18
Why Do This?
•Most coffee drinkers
become hooked in college.
•Research: Students in NYC
spend an average of $45 a
week on beverages -- $79
during exam weeks -- $125 a
week on fast food.

19. 19
Why Do This?
•Students will spend more if
product is available on site.
•Schultz sees the academic
market as the final untapped
frontier and is driven to
capitalize on it before
competitors.

20. 20
Why NYU?
• NYU will be a showcase
pilot … if it succeeds
here it will work
anywhere.
• One of the largest
private schools in the
U.S.
• Affluent student
population.
– Students have more
expendable income for
impulse purchases.

21. 21
Why NYU?
• Growing graduate
population – already
regular Starbucks
customers.
– Many come from New York, a
huge Starbucks market.
• But they purchase
Starbucks off-campus or
buy coffee at other
neighborhood coffee
houses/delis.

22. 22
What’s in it for NYU?
• School looking to
manage costs, utilize
dead space.
• Wants the cache of
being associated with
Starbucks and draw for
students.
• Recruiting: Students
who come here want
access to brands they’re
familiar with.

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What Starbucks Needs from Us
• A communications plan that
will help launch the new
pilot, builds awareness of
the Campus Café concept
among:
– Potential academic clients
– NYU community and
employees
• While building good will
with Starbucks customers
and the general public.

24. 24
What Starbucks Needs from Us
• External PR (local, national,
trade/academic press).
– Raises awareness of Campus
Café concept among key
external constituents
– Paves the way through favorable
press coverage for eventual
expansion to college campuses
nationwide
– Opens doors to Starbucks and
provides them exclusive rights
to build/sell products over
competitors
– Ties in closely with marketing
efforts and leverages both
traditional and social media
channels.

25. 25
What Starbucks Needs from Us
• Internal campaign should tell employees everything they need
to know about Campus Café concept, why it is being done, the
opportunity it represents, and what it means for employees.
• The company has an employee intranet, the Starbuck Portal,
newsletter, Starbucks Times, and a magazine, Starbucks.

26. 26
What Starbucks Needs from Us
• Promotional campaign to
encourage students to try the
pilot and provide incentives that
will encourage repeat
purchases.
• Will coincide with an advertising
campaign that is being
developed separately.

27. 27
What Else You Should Know
• CEO Howard Schultz
is very demanding
and wants us to
secure every
potential external
opportunity to build
interest in Starbucks’
entrée into the
academic market,
and enhance
Starbucks appeal to
students.

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A Final Word …
• Sept. 20, 2015 is
Grand Opening.
• Ceremony will feature
school officials and
Schultz.