The Story of Starbucks-From Inception till date A Presentation(PPT) on Starbucks

1. STARBUCKS
GROUP C1
GROUP - C1

2. HISTORY OF STARBUCKS

3. The Starbucks Story
 1971 - Three friends opened a small shop
in Seattle
 Initially sold fresh-roasted, gourmet coffee
beans and brewing and roasting
accessories
 1982 – Howard Schultz joined Starbucks
 1983 - Schultz travels to Italy, where he‟s
impressed with Milan‟s espresso bars

4. A Brilliant Epiphany that Transformed the
Coffee Industry
• Schultz attended an international
housewares show in Milan
• Fascinated with the exciting
coffee culture in Italy
• Sampled his first cafe latte in
Verona
• Impressed with the cafe
culture, fashionable coffee house
surroundings
• It was an “Aha‟‟ moment as
inspiration struck

5. Cafe Culture
• A brilliant Idea - "Why not
create gathering places like
the great coffee house of
Italy in the United States?"
• Baldwin – „Slow down!
We just sell beans‟
• Baldwin let Schultz test a
modest espresso bar in a
corner of one of the
stores.

6. • Schultz left Starbucks in 1985
to start his own coffee house
• Called his new venture IL
Giornale
• 1987 – IL Giornale acquired
Starbucks and changed the
name into Starbucks
Corporation
• 1992 – Starbucks went public

7. The Evolution Of Starbucks Logo

8. 1971-1987
 Image of a mythical two-tailed mermaid
siren
 coffee brown color scheme
 symbolism represent the irresistible and
seductive quality of the coffee
1987-1992
 Symbolize the melding of the two
companies
 Color scheme → Coffee brown to the
familiar green

9. 1992-2011
 Crops the image of the mermaid
with a close-up view
2011 -
 No longer includes the “Starbucks
coffee”
 Freedom and flexibility to think
beyond just coffee
 The logo was designed to celebrate
the company's 40th anniversary

10. Bean There, Done That!
 1971 – Starbucks Coffee, Tea and Spice Store opened in
Seattle‟s Pike Place Market
 1982 – Howard Schultz joined Starbucks
 1986 – Howard Schultz established Il Giornale
 1987 – Il Giornale acquires Starbucks
 1992 – Starbucks decertified the union and made IPO.
 1995 – Starbucks Coffee International opens in Japan
 1996 - Joins with Pepsi Cola to sell bottled Frappuccino

11. Bean There, Done That!
 1997 - Establishes The Starbucks Foundation, benefiting local
communities
 1998 - Acquires Tazo, a tea company based in
Portland, Oregon
 1999 - Partners with Conservation International to promote
responsible coffee-growing
 2000 – Acquired Hear Music, a San Francisco-based company
 2002 - Enters into licensing agreements to sell Fairtrade
Certified coffee
 2003 – Starbucks acquired Seattle’s Best Coffee
 2009 - Becomes the largest buyer of Fairtrade Certified coffee

12. HUMAN RESOURCES

13. “We're not in the coffee business, serving people,
we're in the people business serving coffee”
- Howard Schultz CEO

14. “Employee First”
20 Hours+
• Generous Benefits
• Health Coverage
• Adoption Program
• Bean Stock
• Invests Heavily in Training
Programs
IN- STORE
• Shifts – Free Drinks

15. Training
• 25 Hour Program
→ coffee history
→ drink preparation
→ coffee knowledge
→ customer service
• A four-hour workshop called
“Brewing the Perfect Cup”

16. ORGANIZATIONAL CULTURE

17. LEGENDARY SERVICE
• “Just say yes”
• “Pour your heart into it”
• Star skills
• The five ways of being

18. STAR SKILLS
• Maintain and enhance
self-esteem
• Listen & acknowledge
• Ask for help

19. FIVE WAYS OF BEING
• be WELCOMING
• be GENUINE
• be CONSIDERATE
• be KNOWLEDGABLE
• be INVOLVED

20. PROBLEMS STEPS TAKEN
• Health Insurance & Stock • Mission Review -
options – Cost to the Feedback Mechanism
company
• 2007 – 1,72,000 employees • Increased wages for
hourly store partners
• Maintaining relationships –
Difficult
• Developed tools to aid
internal hiring
• 2004 – Employee turnover →
80%

21. MARKETING

22. Marketing strategy
• “Unique Cup of Coffee”
• “Third Place”
• In-Store Experience
• Customer Satisfaction
• Creating a Starbucks
community
• Innovation
• Brand Marketing - WOM

23. Online photography scavenger hunt

24. My Starbucks Idea

25. Starbucks Red Campaign

26. Starbucks Got Milk Ad

27. OPERATIONS

28. From Bean To Cup
• Centralized control over the entire
value chain
• Tightly-knit Structure
• Involved in each step of the value
creation process
• Personally chosen high quality beans
• Support center for farmers
• No franchising
• Starbucks stores – Consistent look &
feel

29. From Bean To Cup
• Baristas played a vital role
• Effective measures to
reduce customer‟s wait in
line
- No signatures for
purchases under $25
- Semiautomatic espresso
machines
- “Floaters”
• Altering store design
process

30. HEADWINDS AND CHALLENGES

31. Challenges
 2008 – Recession hits USA
 Financial crisis
 Starbucks' main problem is
overexpansion
 Amount of store closures
 No longer a monopoly
 ‘Coffee Wars’

32. The Brewing Battle

33. Starbucks VS Dunkin Donuts
• Dunkin‟ donuts started its feud with
starbucks in 2007
• Launched an ad - “the delicious latte
from Dunkin' Donuts, you order it
in English, not Fritalian”
• In 2008 Dunkin‟ Donuts began
naming Starbucks in its ads
• DD proclaimed itself the winner in
a national taste test against Starbucks
• “It‟s just more proof that it‟s all
about the coffee (not the couches or
the music)”

34. Starbucks VS McDonalds
• „unsnobbycoffee.com‟
• “four bucks is dumb”
• To offer delicious
gourmet retail coffee at a
lower price than the
competition

35. The Hater’s Club
 Subject of media jokes
 Anti-Starbucks websites
 „www.ihatestarbucks.com‟
 Criticized by nutritionists
 Frankenbucks Campaign

36. CONTROVERSY

37. “The Way I See It”
„Starbucks has a history
of placing liberal, pro-
homosexual and anti-
God statements
submitted by
customers, celebrities
and other public figures
on the side of its coffee
cups for customers to
contemplate‟

39. Same-Sex Marriage Advocacy
On January
12th, 2012, Starbucks
issued a memorandum
declaring that same-sex
marriage 'is core to who
we are and what we
value as a company.'

40. Dump Starbucks

41. Starbucks Appreciation Day

42. CORPORATE SOCIAL RESPONSIBILITY

43. Environmental Impact
 “Grounds for your garden”
 Reducing the size of their
paper napkins and store
garbage bags
 Implemented a water saving
solution
 Recycled content in food
packaging

44. Fair Trade
 “Fair” price for goods
 Largest buyer of
Certified Fair Trade
coffee in North America
 Introduced C.A.F.E

45. STARBUCKS & ENTERTAINMENT

46. Music & Movies
• Hear Music - Starbucks' retail music
concept
• 2005 – selling over 3.5 million CDs
a year
• Produced a CD "Memory Almost
Full“ by Paul McCartney
• Producers of the 2006 film Akeelah
and the Bee
• Bookselling debut with „For One
More Day‟

47. Partnership With Apple
 Selling music as part of the
"coffeehouse experience“
 Apple added a Starbucks
entertainment area to the
iTunes store

48. THE BRAND REPORT CARD

49. The Brand Excels At Delivering Benefits
Customers Truly Desire
• Not just a “Perfect cup of coffee”
• 87,000 drink combinations
• Appeals to all the five senses
- Enticing aroma of beans
- Rich taste of coffee
- Product display & artwork
- Music in the background
- Cozy atmosphere
9/10
9/10
“A great brand is a story that’s never completely told.”

50. Brand Stays Relevant
• Commitment to their core values
• Understands the tastes and
expectations
• Highest level of customer service
• High quality product
• “Third Place”
• Packaging innovation
• “Flavor innovation”
• Latest processing technology 9/10
'A brand name is more than a word. It is the beginning of a
conversation.'

51. The Pricing Strategy Is Based On Consumer’s
Perception Of Value
• Starbucks sets its prices on a simple
idea - high value at moderate cost
• Strict quality controls in its coffee
sourcing & customer service
• Positions itself as an authority on
coffee
• A lot of time and energy
differentiating itself
8/10
• Starbucks also uses relative pricing
“The price of anything is the amount of life you exchange for it”

52. Brand is properly positioned
• “Romance and Theatre”
• Creates an air of
comfort, relaxation, familiarity, exclusivit
y
• POP - Great-tasting
Coffee, Reliability, Speed, Convenience
• POD – Rich Sensory Experience, Exotic 9/10
Coffee, High Quality, Exceptional
Service
“Give them quality – that’s the best kind of advertising”

53. Brand is consistent
• Starbucks stores have used the same
design, furniture and “look and feel”
• Guarantees the same experience in every
store
• Starbucks london to Starbucks
Malaysia, the same model is used, the
same coffee, and the same machines
• Consistently good customer service
9/10
“Consistency builds trust and trust is what will lead you to a loyal
customer”