I’m getting some mixed messages off Starbucks’ decision to par its logo back to an emblem. I’d like to think this is a sign of evolution. And at first glance that’s how it looks. Dolly up the icon, drop the name, drop the association with caffeine. Simple, clean, single minded, international.
On reflection though, I’m more than a little concerned that Starbucks have once again lost their way and are trying to bridge their way to another strategy. I just can’t for the life of me put my finger on where or why.
The market’s already been told that Starbucks is looking to diversify. This from the company blog dated 5 January:
“… we see a world in which we are a vital part of over 16,000 neighborhoods around the world, in more than 50 countries, forming connections with millions of customers every day in our stores, in grocery aisles, at home and at work. Starbucks will continue to offer the highest-quality coffee, but we will offer other products as well – and while the integrity, quality and consistency of these products must remain true to who we are, our new brand identity will give us the freedom and flexibility to explore innovations and new channels of distribution that will keep us in step with our current customers and build strong connections with new customers.”
That sounds like expansion but smells like a straddle to me.
So they’re not abandoning coffee but they are looking to move beyond it and in so doing to attract new customers. Are these new customers people who don’t currently drink coffee? Or perhaps people who don’t want to drink Starbucks coffee? Or people who don’t drink enough Starbucks coffee and need something to go with it?
Ten points for faith in their brand equity, but as Nigel Hollis observes in a blog entry at HBR:
“If you intend to invest heavily in offerings outside the coffee category then removing the word “coffee” is logical. For that matter, if coffee is no longer to be the core of the brand, it’s logical to remove the word “Starbucks” given how synonymous it has become with coffee. But … If the name “Starbucks” is so strongly associated with coffee that you have to remove the name in order to launch another product, does that not suggest that the corporate strategy is out of synch with customer understanding?”
Absolutely.
Here’s my questions. The next step after moves into music distribution and instant coffee is what exactly … and where does that lead that isn’t crowded already? If we are indeed seeing a prelude to ‘the beverage formerly known as Starbucks’, which market is Starbucks going to step into that makes sense post-coffee or alongside coffee, isn’t coffee, is Starbucks enough to be Starbucks friendly without being Starbucks already, is profitable enough for Starbucks to see opportunities in yet doesn’t have plenty of powerful incumbent brands that would give the new entrant grief, and somehow hungers for products sporting the streamlined Starbucks mermaid? Food? Doubt that’s not very competitive. Alcohol? Wow. Can’t see it myself. Electronics? Hardly. Sport? Um …
And if Starbucks feels the need to move substantially away from all that they’re known for (despite the assurances, this does feel like quite a departure philosophically), what equity are they actually banking on to make headway in such markets anyway? Where’s the proof that anyone will or should believe that passionately in a non-coffee Starbucks brand? What’s in it for them?
And if they don’t – then what?
Am I missing something or with this seemingly nonchalant identity change, did someone just bet the company?
