Monday, March 12, 2007

Starbucks Coffee Break

The Love/Respect Axis pictured above is the centerpiece of Lovemarks and it shows that the only place to be is in the top right-hand quadrant. That’s where Lovemarks are - the brands people can’t live without. No one wants to be in the bottom left-hand quadrant with commodities. So when Howard Schultz of Starbucks sent an internal memo to senior managers suggesting that Starbucks was in danger of becoming a commodity, all hell let loose when the memo went public. Everyone had an opinion and the stock went down but for Howard to sound the alarm was a very gutsy move. I talked to Starbucks in Seattle last year and I was deeply impressed by how close they are to living the Lovemarks life. At a time when the company has ambitious growth plans, Howard's message to his people is simple: we can’t take love for granted. And he gives some fantastic specifics that have Lovemarks all over them. Take the efficient, hygienic flavor-locked packaging. The problem? This packaging inhibits customers from truly living in Starbucks' Third Place because they can't smell the coffee. Gone is an important dimension of sensuality from the store. Another example is the question mark over the introduction of automatic espresso machines. Howard suggests they are removing the craft of the baristas, and undermining their personal relationships with regular customers. Mystery, Sensuality and Intimacy have to flourish if you’re going to stay a Lovemark. Howard Schultz knows that and he’s showing his people what matters most to every winning business: keep the love alive.


Rusty said...

I read this at 10.50pm Sydney time - and very nearly headed off to the nearest Starbucks to grab a coffee and salute Howard Schultz. Despite all the success of Starbucks, it appears he hasn't forgotten why he fell in love with the coffee experience many years ago in Italy. The memo he sent underlines a CEO who's passion for the product and the people who enjoy it remains his guiding light for everything he and the company have achieved. Just like your comment on Lee Daley and Manchester United, Howard followed a dream. With that kind of leadership, seems pretty straight forward that Starbucks and Man. United will continue to grow as Lovemarks in the hearts and minds of so many.

Kempton said...

Interesting observations on the Starbucks' hygienic flavor-locked packaging and the automatic espresso machines.

It is always nice to see CEOs constantly looking out for ways to stay on top of businesses.

Sheba said...

I think the mere fact that this would be the 3rd comment on a March 12th post is an indication of how we feel about Starbucks. I met Howard in Kuwait, and i was impressed by his character. However, being raised in Somalia (an Italian colony), and educated in Europe, i have an angst when a store looks too perfect, or when there's a constant reminder that this cafe is owned by a huge corporation, or when Starbucks tell me that the coffee i've been drinking for biggest part of my life is bad quality. I actually like my espresso sour, and i am passionate about how well the beans are roasted.

Perhaps to come out of the corporate squeaks, Starbucks can highlight the life of the franchisees- that they are normal people like us.

Moreover, i get upset when i have to pay more for my starbucks cappuccino in Kuwait, as if the price of coffee is related to the price of oil!

Globalization is a fact, especially for international franchises, and consumers would like to be treated with respect, so that they can reciprocate it.

Jason said...

Readers might enjoy this response to the Sculz memo at ChangeThis.
John Moore In response to Howard Schulz’s memo citing his concern over the direction Starbucks is headed, John Moore, a former marketing guru at Starbucks, enlists the ‘Starbucks Board of Customers’ (i.e. readers of Moore’s blog and Starbucks customers) to propose which changes the company must make to maintain (reclaim?) its integrity.


Josephine said...

An authentic personality is Mr Howard. So for a while as Starbucks has grown, so did the demands placed on it. Could you be the third place when people were sitting in sofas like forever? Could you be the third place if it took the barista too long to make that perfect espresso...? How to keep up the growth, how to sustain it...pressure, drinking should be about total chill out time..yeah we rush to buy it sometimes at lunch break but really what made starbucks unique was the fact that we no longer had to rush so Howard looked at the automated machines and thought...nah...only someone who loves his brand and how it makes people feel would admit that something didn't work...knew there was a reason why I bought and read My Sister Is A Barista in one afternoon.

Mike on the Bike said...

Great article. I am a dentist in a small practice ( By choice when I left the Canadian Forces several large clinics wanted me to join them. The attraction of a smaller , personal practice is something I learned a few years later. My inate attraction to Lovemarks. after a CNN interview with Kevin I realized what it was :)
so anyone ver in Ottawa drop by for a chat..the office has antiques, fossils, posters ( Marilyn Monroe is one of the nicest, a classic) Music from classics to rock and bad jokes, the staff are so fed up with me :)

Thanks for sharing your passion for fun Kevin, it works :)

dr Mike in Ottawa
check out the "Community projects" page, real satisfying for all of us in the office :)

Mike Ross said...

My dentist in Ottawa has recommended that I stop drinking so much coffee. I guess other than just staining my teeth, it's eating away at them too. This is going to be a tough transition for me.