Responds to Global Economic State

 Corporate  Destroys Independent Coffee Houses  Market Saturation  Over-Priced  Ethical Concerns Over Bean Buying Practices Abroad  And…

 Attention to detaildetail  The inspiration for Starbucks: “I saw the relationship Italian culture has with coffee and the romance of the beverage. The Italian starts his day at the coffee bar and sees his friends there later on. It struck me that this was also possible in America. It had never been done – and we could do it because the quality of Starbucks coffee is unsurpassed.” -Starbucks CEO Howard Schultz

 Closed 600 stores in 2008  U.S. same-store sales fell 10 percent in the December quarter  Tossed out low- margin music CDs and other unrelated merchandise  Discontinued sales of “hot breakfast sandwhich”  And…

 Testing “local” coffee shop on Capitol Hill in Seattle  No Starbucks logo or corporate branding  Serving beer & wine alongside caffeinated beverages  “15th Avenue Coffee and Tea”

 Pursuing a “new brand of customer.”  Attempting to reflect the neighborhood feel in their coffee house  Emulating other independent, locally owned competitors  Responding to criticism  Seeking the afternoon and evening crowd

 Responding to globalization with localization  Instead of becoming more like their emerging competitors (McDonald’s) they are going in the opposite direction.  Essentially becoming their own competitor.  Defies traditional marketing theory.

 “You can imagine where this un-branding campaign could lead. A little neighborhood burger place run by McDonald's? A little neighborhood hardware store owned by Home Depot? A little neighborhood five-and- dime operated by Wal-Mart?” -Marc Gunther

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