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Starbucks: A Company to Admire

Even if you’re a Dunkin Donuts fangirl at heart, or someone that only patronizes small cafés, you can’t deny that Starbucks is dominating the corporate world right now. After having a slump in 2008 and 2009, the company is back with a new logo and new outlook on business.

There’s a variety of environmental, financial, and even political reasons why Starbucks CEO, Howard Schultz, landed the coveted spot of Fortune’s 2011 Businessperson of the Year. Here’s how Starbucks is playing the business game and the takeaways you can apply to your own brand.

Engage customers

my starbucks rewards program

With my gold card, I get a free drink every 15 drinks.

Starbucks knows the value of a repeat customer. This is why they’ve set up the My Starbucks Rewards program to encourage brand loyalty. I’ll let you peruse the specific details, but basically, the more you spend at Starbucks, the more freebies you get. The customers are probably spending more, but they appreciate the perks and the faux-VIP status of the gold card they receive at the highest tier of rewards. (This blogger included.)

Starbucks has always said that they want their stores to feel like the “third place”: somewhere you go regularly that isn’t work or home. This is why their stores are stuffed with tables, chairs, and 30-somethings working on the next great American novel.

They’re rounding out the year with a holiday alternate reality app.

Takeaway: Let your customers know that they rule. Even if you don’t have rewards programs or comfy armchairs, you can offer discounts or top-notch customer service. Make your clients know much you value them so that they turn into repeat customers.

Protect your environment

Starbucks is taking great strides to reduce their carbon footprint. They’ve installed lighting with lower energy consumption, reduced water usage, and set out used coffee grounds for customers to take for their garden. They offer a 10 cent discount on any beverage if you bring your own mug. And they have teamed up with MIT to make sure that 100% of their cups are recyclable by 2015.

Takeaway: Help the earth when you can. No longer can companies just stomp all over the environment and expect to be considered awesome. Consumers want to know how you impact the environment and if you’re doing anything to help. You’ll have a better brand image and your employees will be happier.

Follow trends

starbucks selection

With so many coffee and tea drinks (and now juice) to choose from, there's something for everyone.

While I hope that coffee never, ever goes away, Starbucks recognizes that there’s a significant portion of the population that doesn’t drink coffee or wants to pursue healthier options than the white chocolate mocha. So this is why they acquired many coffee alternatives, including the tea company Tazo in 1999 and juice company Evolution Fresh this year. In addition to adding juice products to their coffee shops, they’re planning to open independent stores tentatively titled “Evolution by Starbucks.”

Takeaway: Keep up-to-date with current trends. If pink is all the rage, offer more pink items; if people like pineapple, add a new pineapple flavor. Just make sure that you keep offering the product you’re known for. Nobody wants to go the way of Krispy Kreme.

Support your community

In addition to making Starbucks profitable again, Howard Schultz has also become quiet the political activist. He said that he’s sickened with how dysfunctional Washington is, and that he’s not going to make any campaign contributions to any current politicians of either party. He also asked other CEOs to join him, and over 140 did.

So instead, he’s focusing on creating jobs in America. His program, Create Jobs for USA, seeks to raise donations for community development financial institutions. These institutions will loan the money to small businesses, and ideally, with more money, the businesses will start to hire more employees.

Takeaway: Even if you don’t have Starbucks’ resources, you can still make an impact in your community. Do group volunteering, have a food drive for your local pantry, or donate some of your proceeds to charity.

Did you know the strides Starbucks has taken to be a socially responsible company? Is there something else that you admire (or don’t admire) about the coffee giant? Do you use any of these in your company?

IMAGE CREDIT TO SAMAT JAIN AND JERINE.


Mandy Kilinskis

Mandy is proud to be a part of QLP’s content team. A self-professed nerd, her interests include video games, sitcoms, superhero movies, iPods and iPhones but never Macs, and shockingly, writing. Her claims to fame are: owning over forty pairs of Chuck Taylor All Stars, offering spot-on coffee advice, and knowing an unbelievable amount of Disney Princess facts. You can connect with Mandy on

Comments

  1. Jenna Markowski

    Uh-oh…I’ve never been a fan of Starbucks, BUT THEY HAVE JUICE NOW?! That’s a hook, line, and sinker in my heart. Looks like I’ll be stopping by Starbucks sometime soon!

    I also didn’t know about Schultz’s Create Jobs for USA program — that is a pretty noble cause, and a huge task for him to take on! Hopefully that works out better than Dunder Mifflin’s Fun Run for the Cure. ;)

    • Mandy Kilinskis

      Don’t run out just yet, Jenna! They won’t be rolling out juice products in their stores until early 2012. I’m sure there will be a huge announcement when they do. But start saving your pennies, because I am sure that they will be comparable in price to Jamba Juice.

      Gosh, I sure hope that Create Jobs for USA does better than the Fun Run. But Starbucks is donating $5 million regardless if others do or not! :)

  2. Alex Brodsky

    Though I’m not an avid Starbucks fan (I find coffee disgusting and am not quite yet developing a taste for tea, but their hot chocolate is amazing), I’ve also heard they should be admired for the way they treat their employees. The higher wages they offer and the fact that they give health benefits to part time employees have consistently been praised.

    That is a model for happy employees that EVERY company should follow. Especially in an industry as demanding as giving caffeine addicts their morning doses.

    • Mandy Kilinskis

      Starbucks employees get a really nice deal. They also get free coffee every week! (And bunch more perks that Starbucks workers at Target never got :( )

      And you can tell that Starbucks employees are (in general) happier than say, Dunkin Donuts employees. Whenever I go into the DD by the office, those people look like they want to run away and strangle the soccer mom ordering three dozen donuts and a crazy coffee combination.

  3. amy

    I love Starbucks’ specialty drinks and have contemplated driving out of way home at night to get my caramel macchiato, yum! Instead I keep them as a weekend treat while out running errands :)

    I’m so excited that they’re working to create a totally reusable cup within the next few years! I hope Dunkin’ Donuts does this too because I “kinda” enjoy them too ;)

    Great post Mandy! Starbucks is a very interesting company and one that will probably go down as one of the greatest in history.

    • Mandy Kilinskis

      It’s such a good thing that there isn’t a Starbucks in a prime location on my way to work. Otherwise I know where I huge chunk of my paycheck would be going each month. But I do still get it at least once every other week if I’m out and running around.

      I hope that Dunkin Donuts creates ANY kind of cup that isn’t Styrofoam. Even plastic-lined cups would break down faster. :(

      And Starbucks will definitely go down in history. After all, it’s going to be one of five that survive the apocalypse. ;)

  4. JPorretto

    How appropriate that we finished our discontinued Tassimo Starbucks Latte’s today….

    • Mandy Kilinskis

      Full circle. *sniff tear wibble*

      Though I guess Starbucks is just following the trend that more people use Keurig than Tassimo. :(

  5. Rachel

    I’m with Jenna: once Starbucks starts offering juice, I may start spending a lot more money there than my usual zero. :)

    I knew that Starbucks was into environmental stuff, but didn’t know the details or anything about their other efforts in political activism and charity. Really cool! I definitely have more respect for the company now, even if I don’t drink coffee. :) Also, totally agreed that big companies can’t just ignore their impact on the environment anymore. Customers care about environmentalism much more than they used to, and it’s a competitive advantage for any company to address how much pollution, etc. their business causes.

    • Mandy Kilinskis

      Yeah, that’s not entirely true, I’ve seen you drink non-coffee frappuccinos. :) But I am excited for the day when all of my friends will be able to enjoy Starbucks with me!

      I was really impressed when I read about the political activism that Howard Schultz has gotten into, especially since it has nothing to do with specific parties and everything to do with helping the American population. I, too, was excited to read about their environmental efforts. And considering I’ve had people FIGHT over the used coffee grounds in JANUARY…the customers must love it, too! :)

  6. Jill Tooley

    I didn’t realize Starbucks had less-than-desirable sales back in 2009 — was that when they closed a bunch of stores?

    I’m not loyal to them by any means (I’d say I’m indifferent to their actual products) but I am quite impressed by their initiatives! Can’t wait until recyclable, eco-friendly cups are actually around. And they seem to have a better grasp on where and when to branch out into different markets, which is where many companies make mistakes. Not too shabby, Starbucks. Not at all.

    Great post! :)

    • Mandy Kilinskis

      Yep, 2009 (and the lowest dip of the economy) is when they closed all those stores. Howard Schultz had left the company at that point, so the current CEO was still in the “expand, expand, expand!” mindset. But then Schultez came back and straightened the company out (so far).

      I’m pleased to hear what they are trying to do not just for our environment, but also our economy and job market. It makes me feel happy that someone out there is trying to look out for the little guy. :)

    • amy

      Howard Schultz wrote a book, “Onward” that’s all about the decisions made during the time around all the closings. It’s a really interesting book, pretty business heavy, but really good if you’re curious to find out more :)

  7. david k waltz

    Onward was mentioned by Strategy + Business (a magazine put out by consulting firm Booz) one of the best business books of 2011.

    • Mandy Kilinskis

      I’ve heard nothing but amazing things about Onward. It’s on my reading list to read as soon as I finish my first draft of my novel!

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