Starbucks
Page 39
STARBUCKS: MAINTAINING A CLEAR POSITION
Bryan C. Seaford, TIAA-CREF Robert C. Culp, Tuscan Sun, Inc. Bradley W. Brooks, Queens University of Charlotte
CASE DESCRIPTION The primary subject matters of this case are Marketing and Branding. Secondary issues examined include brand equity and brand positioning. This case has a difficulty level of three (appropriate for junior level courses or higher). This case is designed to be taught in one and one half class hours and is expected to require four hours of outside preparation by students. CASE SYNOPSIS When Starbucks originated in Seattle, Washington in 1971 as a purveyor of dark roasted coffee beans and coffee merchandise, its founding owners didn’t anticipate the extraordinary brand evolution to come. Under the direction of Howard Schultz, who became sole proprietor in 1987, Starbucks transformed into a beverage provider that mirrored the experience of Italian coffee houses including espresso drinks, and elegant camaraderie. This strategy, as part of Starbucks’ brand positioning as the consumer’s “Third Place” to spend his/her time between home and work, ignited a period of extraordinary expansion. By the 1990s, however, Starbucks had begun offering specialty coffee-based drinks (such as its trademarked Frappuccino® drinks, etc.) through mass retail stores. The company also licensed Sodexho to operate Starbucks on naval bases that, despite being traditional Starbucks stores, served a wide variety of other products including pastries, sandwiches, salads, and various merchandise. As higher-end competitors began serving gourmet coffees, Starbucks reacted by increasing its product offerings. By 2005, many Starbucks locations offered a variety of pastries, deserts, and lunch items. Additionally, many Starbucks had begun offering customers drivethrough service. Each of these new additions (both the food and the drive-through additions) was successful in increasing immediate sales and profits and, therefore, in
STARBUCKS: MAINTAINING A CLEAR POSITION
Bryan C. Seaford, TIAA-CREF Robert C. Culp, Tuscan Sun, Inc. Bradley W. Brooks, Queens University of Charlotte
CASE DESCRIPTION The primary subject matters of this case are Marketing and Branding. Secondary issues examined include brand equity and brand positioning. This case has a difficulty level of three (appropriate for junior level courses or higher). This case is designed to be taught in one and one half class hours and is expected to require four hours of outside preparation by students. CASE SYNOPSIS When Starbucks originated in Seattle, Washington in 1971 as a purveyor of dark roasted coffee beans and coffee merchandise, its founding owners didn’t anticipate the extraordinary brand evolution to come. Under the direction of Howard Schultz, who became sole proprietor in 1987, Starbucks transformed into a beverage provider that mirrored the experience of Italian coffee houses including espresso drinks, and elegant camaraderie. This strategy, as part of Starbucks’ brand positioning as the consumer’s “Third Place” to spend his/her time between home and work, ignited a period of extraordinary expansion. By the 1990s, however, Starbucks had begun offering specialty coffee-based drinks (such as its trademarked Frappuccino® drinks, etc.) through mass retail stores. The company also licensed Sodexho to operate Starbucks on naval bases that, despite being traditional Starbucks stores, served a wide variety of other products including pastries, sandwiches, salads, and various merchandise. As higher-end competitors began serving gourmet coffees, Starbucks reacted by increasing its product offerings. By 2005, many Starbucks locations offered a variety of pastries, deserts, and lunch items. Additionally, many Starbucks had begun offering customers drivethrough service. Each of these new additions (both the food and the drive-through additions) was successful in increasing immediate sales and profits and, therefore, in
References: Journal of the International Academy for Case Studies, Volume 18, Number 3, 2012 Page 52 Consumer Reports. (2007). Starbucks wars. Retrieved December 8, 2008, from http://www.consumerreports.org/cro/food/beverages/coffee-tea/coffee-taste-test-307/overview/0307_coffee_ov_1.htm Datamonitor (2003, September) Journal of the International Academy for Case Studies, Volume 18, Number 3, 2012 Page 53 Yahoo! Finance (2010) 1999 Journal of the International Academy for Case Studies, Volume 18, Number 3, 2012 Journal of the International Academy for Case Studies, Volume 18, Number 3, 2012 Page 57