Starbucks redux ~ Brand Mix

Tuesday, March 25, 2008

Starbucks redux

Richard Band added a comment to my summary of opinions about Starbucks asking for my opinion on its recent series of initiatives. So, here goes:

1) Strong brands survive: Many strong brands have hit a rough patch here and there along the road and many of these have been prematurely written off in those times. P&G, Apple and McDonalds come to mind. The thing about these brands is that are extremely resilient. The strength of their equity carries them even when products fail, management teams screw up and competitors start catching up. Starbucks is a member of this club and, with Howard Schultz now fully re-engaged, is well positioned to ride through its current troubles (which are, in any case, more reflected in its share price than its business performance).

2) Back to the basics: Many of the initiatives now underway can be described, as Richard mentions in his comment, as getting back to fundamentals and back to the original vision of the company as outlined in Howard Schultz's book: "Pour Your Heart Into It (1997)." These initiatives (the installation of new Espresso and brewing machines and improving the freshness of the brewed coffee) are all long term investments rather than short term fixes. Exactly the right approach as long as the original vision is still relevant.

3) My Starbucks Idea: According to most blogs I've read, Starbucks doesn't have much of a record embracing customer opinion. So, the launch of the new My Starbucks Idea site (which actively solicits customer ideas and then gives readers a chance to vote on the best) looks like a radical change of direction. But is it? This new site is modeled after Dell's Ideastorm site and is powered by the same application. That means that it was relatively easy to launch so may not, in fact, indicate that the company has made any real cultural shift. The acid test will be how many top-ranked ideas get implemented.

4) Food: The breakfast sandwiches are gone because: "The scent of the warm sandwiches interferes with the aroma of the stores" (Howard Schultz). That makes sense but what about the rest of the food? I used to honestly think that there must be some hidden, strategic reason why the food was so mediocre. Tasteless, uninspired, sometimes stale. When I lived in Europe, there were at least five shops within walking distance that served better pastries and bakery items than anything I've ever eaten in Starbucks. And I lived in a provincial town in Germany. France would surely have been better still. The idea for Starbucks came to Howard Schultz after a trip to Italy. Maybe another trip is in order?

Good enough to share: Spring Edition featuring Starbucks coffee: Brand Mix
Crowdsourcing: Like Dell, Starbucks Wants To Know How They Can Improve: What'
3) Starbucks Strength -- Distribution: Brand NewDay
4) Starbucks Launches Its Version of Dell's Ideastorm: Mack Collier
5) My Starbucks Idea: The Starbucks customer feedback site
6) My Starbucks Idea: Brand Autopsy

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