Case: Starbucks

1. Howard Schultz, current Chairman and Chief Global Strategist of Starbucks, followed various key steps in order to build today s successful and continuously growing coffee business. After a witness visit of caf business to Italy, Schultz decided to implement the European elegant caf spirit into Starbucks coffee house all keeping the American warmth in one coffee shop, where customers can stop by to get a coffee on their way to work, socialize, have a break, or relax after work. In addition, Starbucks has been successfully able to engrave the brand name in the customers mind by creating a strategic mission and sui generis brand values. Starbucks core values has consisted of providing a great work environment and treating each other with respect and dignity, embracing diversity as an essential component in the way they business, applying the highest standards of excellence to the purchasing, roasting, and fresh delivery of their coffee, developing enthusiastically satisfied customers all of the time, contributing positively to their communities and their environment, recognizing that profitability is essential to their future success. Starbucks created simple yet powerful tactics to put these core values into motion. First and foremost, the company has put lots of focus on training its employees to provide the best service to customers, in a way to build a long lasting relationship with this latter; bearing in mind the idea that employees are the key component in keeping the company successful; the reason for which Starbucks has been wary in selecting employees, and considered the focus on empowering them as imperative.

Case: Starbucks

Second, the company has been investing in high quality equipment to ensure an A to Z product and service excellence. Third, oppositely to the prior idea of educating the customer to appreciate coffee the Starbucks way, Behar suggested that Starbucks should be more costumer-oriented, and should rather be flexible in offering what the customers demand, so that they enjoy the coffee the way they prefer to. Last but not least, the company was highly conscious during each and every step of the Starbucks brand construction that continuous profitability is the key to long-lasting success, as it will enable them to reinvest in more modern equipment, and more geographical brand expansions. 2. Starbucks was very cautious while choosing it partners, because the company has seen the importance of having partners who would have compatible corporate culture and core values. This will enable Starbucks quality to be integrated no matter where it is located. In addition, joint ventures had to expose the brand to a wider range of customers, all maintaining the commitment to preserving the authenticity of Starbucks products. Furthermore, the partnership should represent a clear benefit for the brand and the company as a whole, with the condition that Starbucks should keep a hands-on controlling role in all aspects of the partnerships. Almost the same facts happened in both Starbucks partnerships with Host Marriott and United Airlines, where the guests, passengers and travelers, were not exposed to the same product quality they used to experience in their usual coffee shop, in addition to the new customers, who were not

Case: Starbucks interested in exploring more the Starbucks coffee. This happened for the reason that Host Marriott s employees were not properly trained to be the perfect Starbucks baristas, hence, did not provide the same quality of products and service. Host Marriott and Starbucks collaborated to take an effective collaborative action that consisted on investing in an employeetraining program, which trained these employees as if they were new Starbucks hires. The joint ventures with Pepsi and Dryer represented an added value and

more success to Starbucks. Thanks to Pepsi s joint venture, Starbucks created a new line of products, which Frappuccino, the famous bottled coffee beverage. This new product offered an easy-pass for Starbucks to supermarkets. In order to avoid Schultz s fears regarding the coffee quality protection that might be threatened the introduction of the Frappuccino to supermarkets, Starbucks decided to launch an advertising campaign that had as an objective the reinforcement of the company s core values of humility, humor, and homey feeling. As for the Dryer s joint venture, it offered a success to Starbucks as well, by leading it towards the creation of six popular Starbucks coffee ice cream flavors that were marketed under the Starbucks brand name. Starbucks exceled in the ice cream industry, beating well established competitors such as Haagen-Dazs, and this within the first month of its introduction to supermarkets. Finally, Starbucks partnership with Kraft gave a good push to Starbucks in

Case: Starbucks terms of distribution, in a way that this latter largely benefitted from the Kraft's extensive distribution network.

3. Logos: Starbucks name was inspired by Starbuck , a deckhand in the classic American novel Moby dick. Back to the beginning of Starbucks, the founders was trying to create something that contains a seductive mystery mixed with a nautical theme (Steve, 2011). Combining the seafaring history of coffee and Seattle s strong seaport roots, a Siren, who was a 16th century Norse woodcut of a twintailed mermaid, came out to be the representative of the old mermaid looking at that time (Steve, 2011). The logo was designed around Siren. Although Starbucks has updated its logo several times over the past 40 years, the Siren is always there to be the She for Starbucks. The stores location was carefully chosen, as well as the stores design, music, and colors. Starbucks decided to offer to its clientele the best of everything, to create from this coffee shop a personal treat for customers. 4. Performance: In terms of performance, Starbucks is perceived to be a coffee shop that offers high quality products, through effectively in vesting in modern equipment. In addition, Imagery: Starbucks customers are seen as intellectual, elegant people who are luxury lovers, as well as being romantic and innovative. Judgments: Maintaining high quality products and service increases customers trust on Starbucks, which increases the company s credibility

Case: Starbucks Feelings: Starbucks objective is to create a unique coffee experience, in a warm and inviting atmosphere where customers they are home, all being comfortable and relaxed Resonance: Starbucks is company that is highly involved in the community all being actively engaged and highly committed to it. Being involved in various social causes of the community encourages the customers loyalty to the brand.

5. It should not be denied that Starbucks has stood up thanks to its core values, and the unique product and service experience it provides to its customers. However, the company could not escape from competition and trials to duplicate the Starbucks experience. The rivalry threat was strong, especially from Dunkin Donuts that strived to create a similar atmosphere by offering WI-FI service in some of the locations, as well as diversifying in their product line by offering cappuccinos and lattes. In addition, it tried to even beat Starbucks by eliminating the need for baristas through investing in machines that could produce quality cappuccino in few seconds. The Dunkin Donuts knockout trial was offering much lower prices than Starbucks, a step that seemed to be the most threatening to this latter. McDonalds could also be seen as threatening fro the reason that it has been trying to take some of Starbucks stake in the market by offering lattes and cappuccinos. Concerning Dunkin Donuts versus Starbucks, it is clear that there are some similarities concerning the performance, since they both strive for realizing

Case: Starbucks availability and location convenience, as well as investing in equipment and technologies that would help in providing better products and services,

namely coffee machines, and WI-FI service. However, Starbucks still provides better wider product lines, and offers a much better service than Dunkin Donuts, in addition to the unique and inviting atmosphere it offers to its customers. Besides, talking about the imagery, Dunking Donuts appears to be more for customers who are not at all willing to stay at the coffee house, means for people who stop by for a quick cup of coffee. While Starbucks imagery is completely different, and it is perceived to be more for cultivated luxurious yet relaxed people, who are willing to go and socialize in the coffeehouse, relax while reading a book, or surfing in their MacBooks while having their favorite Starbucks drink. 6. Starbucks acts as a leader in the Coffee provider industry and a successful pioneer for corporate citizenship. It has been recognized as one of the 100 best corporate citizens every year since 2000 by the Corporate Responsibility Association (Starbucks, 2010). Starbucks conducts a progressive corporate citizenship strategy, which has several different aspects including Community, Environment, Ethical Sourcing, Wellness and Diversity (Starbucks, 2010). To be specific, Starbucks participates in the local community service projects, uses the materials that only come from suppliers who responsibly grow and ethically trade coffee, and has instituted recycling programs to reduce waste in their stores (Starbucks, 2010). Customer can easily be taught to link these efforts with the company s image,

Case: Starbucks

which has friendly atmosphere in the store with a lovely green logo, recycling product dressing, and clean product finishing process. A coffee shop, which has accomplished grateful social responsibility to the society, environment, and the community, will be accepted by customer as a friendly choice. More importantly, customer will feel the same accomplishment with Starbucks together, when they buy a coffee, and enjoy the same atmosphere every day.

Case: Starbucks Reference Starbucks. (n.d). Being Responsible Company. Retrieved from http://www.starbucks.com/responsibility Starbucks. (n.d) . So Who is The Siren. Retrieved from http://www.starbucks.com/blog/so-who-is-the-siren Starbucks. (n.d). Retrieved from http://unai-globalcitizenship.org/beyondhigher-education/businesses/starbucks Starbucks Newsroom (2010, March 2). Starbucks Named One of the 100 Best Corporate Citizens. Retrieved from http://news.starbucks.com/ article_display.cfm?article_id=331