After reading Schultz's book "Onwards", I reflect on the role of branding in Starbuck's transformation and discuss how its culture and purpose were key factors for its success.

1. 1VALERIA REY
Wh
en the darkest hours come,
lighthouses sit tall upon the highest
point of land closest to the sea,
guiding ships to steer to safe
harbors and ushering them to avoid rocks, reefs and
shallow waters. Much like lighthouses, Brands serve as
guides for businesses — helping them have a clear vision
of where they ought to go in both times of success and
uncertainty. This is exactly what happened to Starbucks
when the company faced turmoil around the years of 2007
and 2008 and used their purpose as the reference point
for their company’s transformation. As described by its
CEO Howard Schultz in the book “Onwards”, Starbucks
began drifting away from its core values of quality,
community and connection as it increasingly focused on
the company’s growth to the detriment of the product and
experience delivered throughout stores. Upon his return
as CEO, Schultz took the steering wheel and began
navigating the company away from turbulent waters by
using the Starbucks’ unique brand as the guiding light
to transform the company’s business strategy, customer
experience and inner culture.
VALERIA REY
IE MVDM
Branding
April 6, 2018
T O P I C
Starbucks’
Lighthouse:
The Role of
Branding in
the Company’s
Transforma-
tion

2. 2VALERIA REY
Si
tting at a higher level, a brand is the
pledged value or truth of an organization.
For Starbucks, this meant striving to
become the “third place,” or what
Schultz described as “a social yet personal environment
between one’s house and job, where people can connect
with others and reconnect with themselves.” This unique
brand idea justified Starbuck’s existence and preceded
the company’s decisions to be or act in a certain way.
Paired with a set of clear values and a revisited mission
statement, the Starbucks brand helped the company’s
leaders determine whether the way they were running
and reinventing business was aligned with the company’s
founding purpose, which was “to inspire and nurture
the human spirit.” For instance, Schultz explains how as
part of the company’s transformation, Starbucks desisted
from partnering with the company that created the
popular video game, World of Warcraft. Even though the
opportunity seemed lucrative and could produce short-
term wins, it was not aligned with the Starbucks brand,
could confuse customers and result in an incoherent
story. On a different case, Schultz also explains how the
company introduced the Mastrena espresso machines
which enabled baristas to produce quality drinks, connect
and make eye contact with customers, which maps back
to Starbucks’ brand values of community and connection.
As seen through these two examples, having a clear Brand
helped Starbucks put their strategies into a larger context,
ensuring relevance, coherence and consistency across the
business.
Be
cause they sit at a higher level, Brands
should come before and underlie any
marketing/ communications campaigns
and customer experience initiatives.

3. Everything that emanates from the company should be
rooted in and derive from the core. Starbucks, for instance,
decided to avoid traditional advertising to differentiate
themselves from McDonalds and other “push” advertisers
who were not necessarily engaging in a conversation with
their audiences. Instead, they stayed true to who they are, a
coffee shop that facilitates connection, and launched two-
way communication platforms like MyStarbucksIdea.com.
Moreover,inatimewhencompanieswerenotyetsaturating
the digital landscape, Starbucks was one of the first brands
to establish a presence online, directly engaging with their
customers and listening to their stories to innovate within
their company. The same applied to customer experience.
In the book, Schultz provides several examples in which
the company introduced customer experience initiatives
aimed at communicating their brand values, such as homey
store designs and loyalty programs. By choosing the
proper media, communication messages and customer
experience tactics for the Brand, the company was able
to strengthen its value proposition to customers, satisfy
their needs and build relationships with them, increasing
the chances of long-term business success.
Th
e Brand also ought to share light on how
the company fosters its inner culture. In
Starbucks’ case, the way employees were
treated and recognized deeply mapped
back to the company’s aim to create a sense of community.
Schultz mentions repeatedly how Starbucks was one of
the first companies to give full healthcare benefits to its
employees, an initiative that they refused to cut even in
times of financial loss. This shows just how important it
was for the company to “walk the talk” and fulfill the
promises it had made both publicly and internally. The
same happened when Schultz and Starbucks’ leadership
3VALERIA REY

4. team decided to introduce LEAN techniques, which
allowed store managers to find new ways to deal with
day-to-day operations. Not only was the introduction of
this technique proof to Starbucks’ claims of committing to
innovation, but it also led to greater employee satisfaction
and morale, key factors that influence the atmosphere
and the quality of the customer service offered in each
Starbucks store. In other words, embodying the Brand
from the bottom to the top of the company helped
Starbucks attract and retain talent and differentiate
themselves from competitors, which is crucial for staying
relevant in the marketplace.
As
seen through Starbucks’ example, a Brand
serves as a constant reference point for
all business activity, including strategy,
product innovation, communications
campaigns, customer experience, among others. Like a
lighthouse casting light to sailors, the Starbucks’ Brand
projected a well-defined and purposeful view of the
world to both internal and external stakeholders of the
company. This way, the company was able to align its
actions with its purpose and values, engage with customers
authentically and deliver on its promises of connection,
community, and quality: key factors in determining
Starbucks’ profitability, relevance and long-term success.
Therefore, we can conclude that a strong, clear Brand
humanizes a business and makes it navigate strategically.
After all, when a shining lighthouse sits high and tall in a
coast, it’s hard not to notice it.
4VALERIA REY
SCHULTZ, HOWARD.
ONWARD. NEW YORK, NY:
RODALE : DISTRIBUTED
TO THE TRADE BY
MACMILLAN, 2011.
R E F E R E N C E