Starbucks Marketing Strategy : How Starbucks Became The Giant In Coffee Industry

If I say the word ‘Starbucks’ to you, what is the first thing that comes to mind?

 

You’d most likely say ‘coffee’, with or without a few other choice adjectives added to it.  

 

starbucks marketing strategy

 

Also, mention the word Starbucks and you’d immediately imagine its iconic green and white mermaid logo, baristas that somehow always seem to misspell your name and plenty of comfortable couches for you to sink into and while away a few hours of the day.

 

From its single humble beginnings in Pike Place, Seattle, Starbucks is now a multinational conglomerate with over 28,209 stores as of 1 April 2018 as reported by Seattle Business.

 

As the largest coffee chain in the world, Starbucks reigns supreme. The company has built its brand from the ground up and has placed itself as one of the most iconic and instantly recognisable brands out there, comparable to the likes of Apple, Nike and McDonalds.

 

And it’s all due to Starbucks’ marketing strategy it built over the decades.

 

So here’s the million ringgit question.

 

Is their brand famous for their oh so delicious coffee? Or is it the great beans they roast and produce? Or perhaps it is their iconic stores?

 

Starbucks Marketing Strategy

 

It is everything. Starbucks has done everything they can to understand the wants and needs of their customers while delivering them at a human, interactive level.

 

Here’s the thing. If one takes a look at their success, you’d think that Starbucks’ had spent billions in marketing strategy. While the company had spent over $370 million in 2016, that amount pales in comparison to other companies and its competitors.

 

What differentiates Starbucks’ marketing strategy to others is simply this.

 

Starbucks Marketing Strategy 101

 

They understand that while they are selling their customers a product – an everyday product at that – it is the customer experience that really seals the deal.

 

Given the choice, most of us would pay more for fantastic customer experience over a cheaper and better product simply because the former has made us feel good while the latter has not.

 

Of course, the company’s rather premium products don’t lend itself to a target consumer base with lower than average income. Its customers are mainly from the upper or upper-middle-class economic strata who want a place outside of their homes to take a moment for themselves, and perhaps, even a frappe or two.

 

And Starbucks, with its famous two-tailed siren logo, certainly knows how to give its customers that exact customer experience they really want.

 

The Third Place

Walk into any Starbucks outlet and you’d see the same instantly recognisable woody decor & furniture, high glass windows and the feeling that you could be sitting at the table for hours doing something, anything and it’ll all be worth it.

 

That’s on purpose.

 

The company aims to be what they term the ‘third place’ of the community, after your home (first place) and your office (second place).

 

As the Starbucks mission statement exemplifies “To inspire and nurture the human spirit – one person, one cup and one neighbourhood at a time”, each Starbucks coffee chain is designed to achieve that third place characteristic, with homely, comfy and snug couches; soft, comfortable interior designs; free Wi-Fi and coffee in hand.

 

They have positioned themselves as the place to be for those who want a place feeling like a home away from their homes and it’s common to see people at any Starbucks cafe browsing on their phones, working on a laptop, hanging out or even holding professional or casual discussions.

 

While other cafes might reject the idea of someone hogging a table for an entire day, Starbucks relishes that same situation.

 

And that is something that anyone in business can adopt.

 

Give your customers that customer experience that they really crave for and they’ll be back, even if the price of the product you’re offering is slightly higher than average.  

 

Service with a Smile

 

The first thing that you hear when you step foot into a Starbucks outlet would be the cheery greetings from the baristas bustling about making the coffee orders.

 

All baristas are trained to have excellent customer service and their customer service commitment is directed fully to fulfil their customers’ needs and wants.

 

As you place your order, you will be asked to provide your name (if you are a regular at a certain Starbucks branch, their baristas might even remember your name! Or misspell it yet again) and your drink (that you can customise to your liking).

 

Starbucks Marketing

 

Perhaps if you feel so inclined, the baristas might even speak to you as if you were long lost friends. Stated clearly in their customer service commitment is to make every moment feel just right.

 

Wouldn’t it feel just right for you to walk right into a store, order your usual joe while the friendly barista behind the counter talks to you about your day as he crafts your order, just the way you like it?

 

There is a reason for this as well.

 

There is a study made that states it costs more for a business to attract new customers than it would to retain its existing client base.

 

By making you feel welcomed and at ease, you’ll be inclined to return again and if you are unable to return to this particular store, no matter. You fully expect to have the same experience at another outlet with the same consistent smile and service.    

 

All this to achieve higher revenue per customer, attracting prospective regulars, by providing friendly service, and familiarity to the customers – as the expansion of their operations only contribute a lower portion of revenue compared to their customer.

 

Consistent Branding

 

Every famous brand must have its own recognisable logo – its identity, so to speak. That goes the same for Starbucks.

 

In his book Onward: How Starbucks Fought for Its Life Without Losing Its Soul, former Starbucks President and CEO Howard Schultz said, “The only number that matters is ‘one’. One cup. One customer. One partner. One experience at a time.”

 

This same mantra is what drives Starbucks’s marketing to replicate its retail outlets with the same consistent customer experience across all its stores and its products.

 

Its double-tailed mermaid logo is instantly recognisable anywhere, and the company has made its many outlets, merchandise and food and drinks consistent with a standardised look and feel.

 

 starbucks packaging

 

Walk into any Starbucks branch in the world, I doubt you won’t be understood if you ask for a Venti Caramel Frappuccino. Further, you would know with utmost certainty that the same order halfway across the world will result in the same great taste that you’re accustomed to back home.

 

However, to cater to changing times and to preserve its timeless aesthetics, Starbucks’ decided to give a new breath of life to their most recent logo in 2011, by going against the wording on the outer layer, giving the mermaid an all-new and modern design greenish look.

 

They eliminated the wording ‘Starbucks Coffee’ in order to expand its range of products, which was previously limited to coffee and its associated products.

 

Moreover, Starbucks created a loyalty programme through its Starbucks Card, in order to make its consumers feel rewarded. Rewards they offer include free food and drinks, and their merchandise such as planners, lanyards etc are all made with the same consistent branding and feel that the company has gone for.

 

Such consistency and quality that are provided throughout their wide branch of operations are one of the contributing factors that made so many people be their loyal customers, which is itself another lesson for would-be franchise owners.  

 

Honestly, even with the changes, I doubt anyone would be not able to recognise the Starbucks logo, even if they are not a fan of it. The Starbucks marketing strategy has made their brand recognisable worldwide.

 

And that leads to the next point.

 

Being Part of An Inner Circle: how to make your customers feel like they’re part of your family

 

By offering a pleasurable and relaxed customer experience, Starbucks has been successful in focusing the customers’ attention on the quality of the experience, enjoyable memories that can be woven together in its stores and not merely on the pricing of its products.

 

In a recent article by Upserve, it was noted that Instagram has impacted restaurant designs in order to attract consumers, with some dining destinations creating specific feels and decor to attract their clientele.

 

Some also create designated Instagram walls complete with hashtags and brand logos while others have white walls, bricks, marble countertops, neon signs and soft lighting.  

 

In the age of social media, any place that does not provide that Instagrammable feels to their customers will fall by the wayside and perish. This change is essential as the Starbucks’ embraces changes to its digital brand.

 

Starbucks’ consumers have the money to spend, and they want others to know about it.

 

They want to be able to show their followers where they are and what their surroundings are like. If the place they are visiting does not offer that photogenic feel, consumers are now more than likely to move on to a location that does offer that ambience.

 

This in turn ties back to Starbucks’ ability to charge premium prices for their coffees.  

 

The Age of Instagram – And the Art of a Misspelt Name

 

The brand has also started to invest heavily in mobile marketing, though not to the degree that some other brands have done. They have, as a company for a long time, understood implicitly that social media is here to stay and has made itself a mainstay in many an Instagram and social media post.

 

The results, however, are comparable and in some ways, outstrips their competitor’s efforts. Here are two examples provided.  

 

For the first, I’ll take their campaign on Blonde Espresso that ran last February 2018.

 

 

 starbucks marketing strategy

 

This is a screenshot from their Instagram page post.

 

 starbucks blonde espresso

 

In one of their branches.

 

 starbucks marketing strategy

 

From their website.

 

Similarly, you can watch their videos on Youtube on Blonde Espresso.

 

Consistency in tonality, style and feel has always been a mainstay in the company’s ethos and it is no different here.

 

Observe the bright warm tone that is used across all its digital marketing, the casual use of tone, fonts and style.

 

The Starbucks marketing department has ensured that all marketing collaterals convey that same warm, casual tone that is synonymous with the company.

 

The second is something a little more ingenious.

 

Now imagine this.

 

You’re standing in line at Starbucks, explicitly given the barista your order and name, waited patiently for your drink. Your order arrives, and you move to collect it.

 

That’s when you notice your name was spelt wrong.

 

Most of us would be tempted to move on from this little gaffe, and get on with our day. After all, it’s just a mistake and it doesn’t really matter to us anyway.  

 

Some, however, would not think so.

 

Instead, they’d take the opportunity to take a snap of the cup with the misspelt name, and share it out on their Instagram page. I mean, how difficult is it to spell your name correctly, right? (like LOL!) They might even add a quick quip and a hashtag #starbuckswrongname or three.

 

For Starbucks, that’s mission accomplished.

 

That’s right. The company has been getting 100% free advertising for years from spelling your name wrong on purpose. Cue the shocked gasp.

 

A quick search online using various hashtags around the term ‘Starbucks’ & ‘wrong name’ yielded over a dozen different terms and communities built around that same mistake.

 

That’s free marketing all using that same little “mistake” their baristas have made. How much advertising do you think Starbucks has gotten from that?

 

It’s a lot more than what you’re thinking right now.

 

It is estimated that the recent mistake made by the TV series Game of Thrones when the directors accidentally left a generic coffee cup in one of their episodes was worth over millions USD when coffee lovers started tweeting about how Starbucks left their cup in the show.

 

Now imagine that happening every single day when Instagram and Twitter users post their shots up on their page.

 

Ingenious? I think so.

 

The company has built a brand based on warmth, familiarity and has leveraged its brand to allow users to feel completely at home and at ease with its “human mistakes”.

 

And this is why, Starbucks, despite purportedly selling only coffee, is not only selling coffee. They have managed to sell an entire consumer experience, and with it, charge the happy public a premium for its products.  

 

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