International Br

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by
here 1. Executive Summary

2. Global Presence

3. History of the Brand

4. Brand Strategy

5. Sub-brands

6.Target Segments

7. Brand Positioning

8.Product Development

9. Packaging

10.Distribution

11.Pricing

12. Marketing Communication

13.Brand Awareness

14. Brand Image

15. Brand Equity

16. Sources
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Please select one brand and
go to the next page 2009
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*indicates brands that did not appear in
 BEST GLOBAL BRANDS

2009
Change
2008 Country of Brand
Brand Sector in Brand
Rank Origin Value
Value
($m)

1 United States Beverages 68,734 3%

2 United States Computer Services 60,211 2%
3 United States Computer Software 56,647 -4%
4 United States Diversified 47,777 -10%

5 Finland Consumer Electronics 34,864 -3%

8 United States Restaurants 32,275 4%
10 United States Internet Services 31,980 25%
6 Japan Automotive 31,330 -8%
7 United States Computer Hardware 30,636 -2%
9 United States Media 28,447 -3%

12 United States Computer Hardware 24,096 2%

11 Germany Automotive 23,867 -7%

14 United States Personal Care 22,841 4%

17 United States Computer Services 22,030 3%
13 Germany Automotive 21,671 -7%

16 France Luxury 21,120 -2%

18 United States Tobacco 19,010 -11%

20 Japan Automotive 17,803 -7%

21 Republic of Korea Consumer Electronics 17,518 -1%

24 United States Computer Hardware 15,433 12%

22 Sweden Apparel 15,375 11%

15 United States Financial Services 14,971 -32%

26 United States Beverages 13,706 3%

23 United States Computer Software 13,699 -1%

28 Switzerland Beverages 13,317 2%

29 United States Sporting Goods 13,179 4%

31 Germany Computer Software 12,106 -1%

35 Sweden Home Furnishings 12,004 10%

25 Japan Consumer Electronics 11,953 -12%

33 United States Alcohol 11,833 3%

30 United States Transportation 11,594 -8%

27 United Kingdom Financial Services 10,510 -20%

36 Japan Computer Hardware 10,441 -4%

39 United States Food 10,428 7%

32 United States Computer Hardware 10,291 -12%

19 United States Financial Services 10,254 -49%

37 United States Financial Services 9,550 -11%

38 United States Financial Services 9,248 -10%

40 Japan Consumer Electronics 9,210 5%

44 Canada Media 8,434 1%

45 Italy Luxury 8,182 -1%
43 Netherlands Diversified 8,121 -2%

58 United States Internet Services 7,858 22%

51 France Personal Care 7,748 3%
47 United States Computer Services 7,710 -3%
46 United States Internet Services 7,350 -8%
48 Germany Diversified 7,308 -8%

56 United States Food 7,244 9%

49 United States Automotive 7,005 -11%
62 Spain Apparel 6,789 14%
61 United States Food 6,731 10%

57 United States Personal Care 6,550 2%

55 France Financial Services 6,525 -7%
52 United States Media 6,523 -9%

53 Germany Automotive 6,484 -8%

59 United States Computer Hardware 6,431 1%

42 United States Financial Services 6,399 -26%

63 Switzerland Food 6,319 13%

60 France Luxury 6,040 -5%

66 France Food 5,960 10%

64 United States Restaurants 5,722 3%

70 Germany Sporting Goods 5,397 6%

73 Canada Consumer Electronics 5,138 7%

65 United States Internet Services 5,111 -7%

67 Germany Automotive 5,010 -7%

68 United States Diversified 5,004 -5%

69 United States Personal Care 4,917 -7%

71 Switzerland Luxury 4,609 -7%

72 Republic of Korea Automotive 4,604 -5%

76 France Luxury 4,598 1%

74 United States Personal Care 4,404 -5%

41 Switzerland Financial Services 4,370 -50%

50 United States Automotive 4,337 -43%

75 Germany Automotive 4,234 -8%

78 Japan Consumer Electronics 4,225 -1%

80 United States Luxury 4,000 -5%

 79 Switzerland Luxury
3,968 -6%

77 United States Apparel

3,922 -10%

81 United States Restaurants

3,876 -5%
92 United States Personal Care
3,847 7%

82 Germany Financial Services

3,831 -5%

83 France Alcohol
3,754 -5%

84 United Kingdom Energy

3,716 -5%

89 United Kingdom Alcohol

3,698 3%

88 United States Consumer Electronics

3,563 -3%

98 Germany Personal Care

3,557 5%

91 Italy Luxury
3,530 -2%

93 Italy Automotive
3,527 0%

94 Italy Luxury
3,303 -6%

85 United States Restaurants

3,263 -16%

New France FMCG

3,235 New

97 Netherlands Energy
3,228 -7%

New United States Restaurants

3,223 New*

100 United States Financial Services

3,170 -5%

New United States Computer Software

3,161 New

90 Japan Automotive
3,158 -12%
 New Germany Sporting Goods
3,154 New

New United Kingdom Luxury

3,095 New*

New United States Luxury

3,094 New*

New United States FMCG

3,081 New
ndicates brands that did not appear in the previous year's top 100 ranking
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Type in your brand
selection
 Your Brand

STARBUCKS
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1. Please select one
2. Complete an aud
template.
 Instructions

1. Please select one global brand from the provided list.

2. Complete an audit of this brand by following steps in this
template.
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st.
in this
 1

Executive Summary:
The Starbucks story is a
1970's as a local retail st
It wasn’t until 1987 when
Starbucks acquired the c
and perspective of the b

Since the beginning Star

reinventing the status qu
with 16,000 stores in 50
successful due to its exc

However, this rapid grow

has established a well re
accomplish its expansion
of criticism concerning it
brand image. Today, Sta
ways to stregthen its bra
effort, will position its ic
industry. The following b
must overcome and and
 1. Executive Summary

Executive Summary:
The Starbucks story is a fascinating story that begins with its humble beginnings
in
1970's as a local retail store focused solely on selling coffee and coffee
equipment.
It wasn’t until 1987 when Howard Schultz, the present Chairman and CEO of
Starbucks acquired the company. The sparked a complete change in the philosopy
and perspective of the business that remains intact today.

Since the beginning Starbucks was established by an ambitios entrepreneur fixed on

reinventing the status quo. Starbucks has grown to be over a $9 billion business
with 16,000 stores in 50 countries. Since inception it has remained financially
successful due to its exceptional ability to grow and expand into new markets.

However, this rapid growth and expansion has affected its overall brand. Starbucks
has established a well recognized brand globally. It has leveraged its brand to
accomplish its expansion strategy. In recent years, Starbucks has experienced a lot
of criticism concerning its business practices and therefore has had to rescue its
brand image. Today, Starbucks is working hard on its brand strategy and developing
ways to stregthen its brand awareness, image and gain back equity. With this
effort, will position its iconic brand to maintain its leadership position in the
coffee
industry. The following brand audit will uncover the technical challenges Starbucks
must overcome and and detail the implications of a suffering brand.
 Menu

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e beginnings in
ee equipment.
CEO of
the philosopy

preneur fixed on
ion business
inancially
w markets.

and. Starbucks
s brand to
perienced a lot
o rescue its
y and developing
With this
n in the coffee
nges Starbucks
Global Presence:
The Starbucks business model and iconi
Starbucks expands into new markets it
brand. Today, Starbucks operates 16,00
and other parts of the world such as Ru

China, for example has become a fascin

close to 500 stores in China. Starbucks
1.3B in China interested in western and
WIFI, digital music, TV will enhance the
China with an enduring brand.

As Starbucks continues to expand globa

For example, since 2000, consumers ha
movement is aimed at supporting small
that coffee growers only sell about 20%
Fair Trade coffee at it stores. Starbucks
investing in loan programs for coffee-g

Another such program is the Starbucks

community such as the Ethos Water cam
contributed to the Ethos® Water Fund.
water or poor water quality. Starbucks
criticism and increasing the value of its
 2. Global Presence

nce:
ks business model and iconic brand is well positioned to remain a leader in the
coffee industry. As
xpands into new markets it has remained true to its original philosophy and
continued to develop it
y, Starbucks operates 16,000 locations in 50 countries. The company plans to
develop partners in
rts of the world such as Russia and India while maintaining a mirror image of its
US operations.

ample has become a fascinating story for Starbucks. The first store opened in
1999. Today, there
stores in China. Starbucks market research reveals that there are about 200
million young people
a interested in western and iconic products. Starbucks has realized that offering
amenities such as
music, TV will enhance the experience. Starbucks is working on maintaining a long
term presence
n enduring brand.

s continues to expand globally it has become under pressure to become a responsible

global citizen
e, since 2000, consumers have been demanding that Starbucks offer Fair Trade
coffee. The
s aimed at supporting small farmers forced to sell coffee at ridiculously low
prices. It is estimated
growers only sell about 20% of their coffee at Fair Trade prices. In response,
Starbucks now offers
ffee at it stores. Starbucks also helps sustain coffee farmers and stregthen their
communities by
loan programs for coffee-growing communities.

h program is the Starbucks Foundation that fosters several initiatives aimed to

supporting the
uch as the Ethos Water campaign. Every time someone buys a bottle of Ethos®
Water, 5 cents is
to the Ethos® Water Fund. The fund provides financial assistance to areas that
suffer from lack of
r water quality. Starbucks hopes that these global initiatives and programs will
silence recent
d increasing the value of its brand.
 Menu

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r in the coffee industry. As

and continued to develop its
ans to develop partners in Back
age of its US operations.

ened in 1999. Today, there is

ut 200 million young people of
t offering amenities such as
ining a long term presence in

a responsible global citizen.

r Trade coffee. The
low prices. It is estimated
onse, Starbucks now offers
then their communities by

med to supporting the

f Ethos® Water, 5 cents is
eas that suffer from lack of
rams will silence recent
 3

In 1983, just two years afte

of Starbucks to enhance the
coffee. The idea was sprun
international housewares sh
their coffee led to a revelati
impressed with the coffee h
of the barista with its custom
as an integral community g
had a barista who performe

Consequently, Schultz imme

coffee, espresso, and cappu
to Starbucks should be an e
friends and visit. Re-creatin
Starbucks' differentiating fa
 3. History of the Brand

In 1983, just two years after joing the company Howard Schultz presented an idea to
the owners
of Starbucks to enhance the coffee experience by offering a warm welcoming place to
enjoy
coffee. The idea was sprung when the company sent him to Milan, Italy, to attend an
international housewares show. Having experienced first-hand how the "baristas" in
Italy made
their coffee led to a revelation that this could be a valuable concept in the US.
He was primarly
impressed with the coffee house atmosphere in Italy and intrigued by the comfort
and familiarity
of the barista with its customers. Most importantly he observed how most espresso
bars function
as an integral community gathering place. Each one had its own unique character,
but they all
had a barista who performed with flair and exhibited a camaraderie with the
customers.

Consequently, Schultz immediately recognized that Starbucks needed to serve fresh-

brewed
coffee, espresso, and cappuccino in its stores (in addition to beans and coffee
equipment). Going
to Starbucks should be an experience, a special treat; the stores should be a place
to meet
friends and visit. Re-creating the Italian coffee-bar culture in the United States
could be
Starbucks' differentiating factor.
 Menu

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idea to the owners
place to enjoy
tend an
tas" in Italy made Back
. He was primarly
mfort and familiarity
resso bars function
acter, but they all
customers.

e fresh-brewed
equipment). Going
place to meet
s could be
Starbucks claims to be in th
philosophy. Starbucks has m
infusing different cultures, s

Starbucks has an outlook ge

from exotic locations—Suma
a wider world. While anti-A
understands that it roots wi

Much of the Starbucks bran

made to Italy in the 1980s e
of the brand. The blend of t
"latte", "cappaccino",etc. I
cater to the local food intere
drink tea, therefore Starbuc

Another brand strategy that

Starbucks Foundation and in
image.

Unfortunately, Starbucks ef
aggressive and buying out c
 4. Brand Strategy

Starbucks claims to be in the people business, serving coffee. The brand strategy
reflects this
philosophy. Starbucks has managed to different its business by creating a unique
coffee experience,
infusing different cultures, serving its employees and its community.

Starbucks has an outlook genuinely interested in cultures beyond the US, proudly
displaying its beans
from exotic locations—Sumatra, Kenya, Guatemala, Costa Rica, Ethiopia, speaks for
an awareness of
a wider world. While anti-American anger has prevailed over the last few years,
Starbucks
understands that it roots will always remain American but acknowledges its global
footprint.

Much of the Starbucks brand came from countries outside the US. In particular,
trips that Schultz
made to Italy in the 1980s ensured that the American is fused with the Italian to
create the essence
of the brand. The blend of the Italian culture is evident in the product names such
as "frappaccino",
"latte", "cappaccino",etc. In international locations, Starbucks tends to serve the
same coffee but
cater to the local food interests. In some cases it has began to serve tea. It is
custom in China to
drink tea, therefore Starbucks has preserved this custom and incorporated into its
menu.

Another brand strategy that has proven useful is Starbucks contribution to the
community. The
Starbucks Foundation and investments into truly global causes has bode well for the
Starbucks brand
image.

Unfortunately, Starbucks efforts come short as the public continues to view their
strategy as over
aggressive and buying out competitors' leases, intentionally operating at a loss.
 Menu

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tegy reflects this
que coffee experience,

Back
udly displaying its beans
ks for an awareness of
rs, Starbucks
obal footprint.

r, trips that Schultz

to create the essence
such as "frappaccino",
the same coffee but
s custom in China to
o its menu.

e community. The
for the Starbucks brand

heir strategy as over

ss.
Starbucks has created a sub
may become a nationwide “
and the perceived monopol
privately owned coffeehous

Seattle's Best Coffee name

Starbucks also owns the fol

- Tazo Tea
- Starbucks DoubleShot
- VIA instant coffee

Starbucks also employs a co

drink, and brand franchising
 5. Sub-brands

Starbucks has created a sub-brand called "15th Ave E Coffee & Tea.” This is part of
what
may become a nationwide “un-branding campaign. The driving forces are the recession
and the perceived monopolization of the coffee business and driving out the local
privately owned coffeehouses.

Seattle's Best Coffee name was acquired when Starbucks baught the business in 2003.
Starbucks also owns the following brands:

- Tazo Tea
- Starbucks DoubleShot
- VIA instant coffee

Starbucks also employs a co-branding strategy with other manufacturers of food and
drink, and brand franchising to manufacturers of other goods and services.
 Menu

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art of what
e recession
ocal
Back
s in 2003.

ood and
Originally Starbucks targete
expanded to target the high
coffee drinks and now consi
slightly more affluent group
coffee while working on oth
 6. Target Segments

Originally Starbucks targeted young college students, however now as it has matured
and
expanded to target the high-end income coffee drinker. Starbucks is among the
highest priced
coffee drinks and now considered a "luxury" coffee maker.
slightly more affluent group of adults around the ages of 18 to 35, who can spend
time sipping
coffee while working on other tasks.
 Menu

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matured and
he highest priced

end time sipping Back

Starbucks deals with brand
themselves by appealing to
simple to-go product offerin
themselves against McDona

The VIA instant coffee brand

store.

Starbucks has also employe

that prefer to spend time in

Therefore, Starbucks has po

 7. Brand Positioning

Starbucks deals with brand positioning by continuously catering to its customers.

They position
themselves by appealing to their target markets needs. This includes serving as a
quick and
simple to-go product offering (about 80% of their business). Most recently they
have positioned
themselves against McDonald's by also offering Drive-Thru windows at selected
locations.

The VIA instant coffee branded product serves their customer base that is not able
to visit a
store.

Starbucks has also employed a strategy to create a meeting environment For those
customers
that prefer to spend time in their stores.

Therefore, Starbucks has positioned its brand to cover a broad spectrum of

customers.
 Menu

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ers. They position
as a quick and
ey have positioned
ed locations. Back
able to visit a

those customers

stomers.
 8.

Starbucks has a reputation

vulnerable to the possibility
ago, Starbucks ventured int
Starbucks introduced a carb
that that innovative and ent
of these attempts failed, he
successes. It is clear that S
driven by customer insight.

With its state-of-the-art prod

world, Starbucks continue t
on technical research and d

Going forward, Starbucks co

hotspots as an asset. With
leveraged. Starbucks plans
TV to music download servi
 8. Product Development

Starbucks has a reputation for new product development and creativity. However,
they remain
vulnerable to the possibility that their innovation may falter over time. For
example, several years
ago, Starbucks ventured into the magazine business and quickly failed. Before the
frappaccino,
Starbucks introduced a carbonated drink that also failed. Howard Schultz, Starbucks
CEO claims
that that innovative and entrepreneurial spirit still lives in the fabric of the
company. While many
of these attempts failed, he credits the spirit of the company to create huge
commercial
successes. It is clear that Starbucks has redefined the coffee drink turning coffee
into creations
driven by customer insight.

With its state-of-the-art product development labs outfitted with coffee experts
from around the
world, Starbucks continue to invest in product development. In 2009, Starbucks
spent $6.9 million
on technical research and development.

Going forward, Starbucks continues to innovate. For example, Starbucks has

identified its WiFi
hotspots as an asset. With thousands of locations, Starbucks owns a network that
can be
leveraged. Starbucks plans to roll out new internet based products in stores
ranging from online
TV to music download service.
 Menu

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ver, they remain

ample, several years
e the frappaccino, Back
arbucks CEO claims
mpany. While many
ommercial
ffee into creations

s from around the

cks spent $6.9 million

identified its WiFi

that can be
anging from online
In 2009, Starbucks several s
environmental footprint. In
post-consumer recycled fibe
polypropylene cold cups, wh
emissions during manufactu
cups recyclable by 2012.
 9. Packaging

In 2009, Starbucks several stores will begin to be constructed as LEED-certified,

reducing the
environmental footprint. In 2006, Starbucks introduced a paper cup that contained
10 percent
post-consumer recycled fiber, and last year it switched from the standard PET cold
cups to
polypropylene cold cups, which use significantly less plastic and reduce greenhouse
gas
emissions during manufacturing by 45 percent. Starbucks also intend to have 100
percent of its
cups recyclable by 2012.
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d, reducing the
tained 10 percent
cold cups to
house gas Back
100 percent of its
major

As part of our international

our retail stores. Extending
more customers in more pla
around the world. There rem
and with an increasing varie

Starbucks is adding to the p

a number of other compani
is to improve distribution an
Pepsi-Cola Company to prod
warehouse club stores is an
 10. Distribution

As part of our international strategy, Starbucks intends to seize opportunities to

move beyond
our retail stores. Extending its profi table global consumer products group allows
them to reach
more customers in more places that will allow them to grow the business at an
accelerated pace
around the world. There remains a big opportunity in the evolution of their
distribution structure
and with an increasing variety of offerings in the grocery channel.

Starbucks is adding to the product mix by offering new licensing agreements for its
products with
a number of other companies. Generally, the main purpose of creating the licensing
agreements
is to improve distribution and production methods of Starbucks products. The
agreement with
Pepsi-Cola Company to produce and distribute bottled Starbucks products in grocery
and
warehouse club stores is an excellent example of this type of licensing agreement.
 Menu

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to move beyond
ws them to reach
n accelerated pace
tribution structure Back

for its products with

ensing agreements
e agreement with
grocery and
ment.
In general, the Starbucks co
retail chain stores. Historic
to buy pricey espresso drink
Amidst the recession, Starb
raised prices by 5 cents per
average of 4.9%. The pricin
claim that the price hike is n
 11. Pricing

In general, the Starbucks coffee brand has positioned itself as a high-end spectrum
among
retail chain stores. Historically, the company succeeds in persuading nearly 40
million people
to buy pricey espresso drinks. Starbucks pricing strategy has come to questions
recently.
Amidst the recession, Starbucks has decided to increase its product's prices. U.S.
based stores
raised prices by 5 cents per cup and ground coffee was raised by 50 cents per pound
or an
average of 4.9%. The pricing yields a %56% profit margin on all products. Company
officials
claim that the price hike is necessary to cover operating expenses (i.e. labor and
fuel costs).
 Menu

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ctrum among
0 million people
ns recently.
U.S. based stores Back
r pound or an
mpany officials
and fuel costs).
12. M
12. Marketing Communication
n Menu

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Back
Starbucks has invested in u
focus groups, tests) to mea
detect the customers needs
Starbucks to offer a cup of c
almost every street corner c
serving a reliable cup of cof
China.
 13. Brand Awareness

Starbucks has invested in understanding their customers and developing tools (in-
store surveys,
focus groups, tests) to measure customer satisfactions. They focus on serving the
customer and
detect the customers needs and wants that are unfulfilled. Consumers know they can
count on
Starbucks to offer a cup of coffee. They bring the brand to the consumers by
offering stores in
almost every street corner creating a strong presence. Starbucks has a high
recognition for
serving a reliable cup of coffee, its always going to taste the same whether you
are in the U.S. or
China.
 Menu

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s (in-store surveys,
g the customer and
they can count on
offering stores in Back
recognition for
ou are in the U.S. or
Starbucks has become a
and dependable. Like W
never out of stock.

In recent years Starbuck

diluting its brand image.
as the best coffee house
a Consumer Reports tast
the company’s same-sto
is also adding or upgrad
diluting the Starbucks br

In general, the brand im

claiming that Starbucks
share. A movement to re
issues have contributed

The recent move to crea

possibly cannibalizing th

Starbucks is now workin

reinvent itself.
 14. Brand Image

Starbucks has become a globally relevant brand. They are considered accessible
and dependable. Like Wal-Mart, they manage the supply chain so well that they are
never out of stock.

In recent years Starbucks has been subject to the possibility of “commoditizing” or

diluting its brand image. Starbucks was edged out by Dunkin Donuts for first place
as the best coffee house chain in the recently-released Customer Loyalty Survey. In
a Consumer Reports taste test, McDonalds’ coffee won over Starbucks’. Additionally,
the company’s same-store sales growth is declining. Furthermore, the competition
is also adding or upgrading stores and emulating the Starbucks "experience" further
diluting the Starbucks brand.

In general, the brand image has been suffering due to the backlash by consumers
claiming that Starbucks is adopting agressive marketing tactics to gain more market
share. A movement to reveal Starbuck's coffee sourcing practices and othe similar
issues have contributed to tarnish its brand further.

The recent move to create several sub-brands may be hurting the brand image and
possibly cannibalizing their own brand.

Starbucks is now working hard to revitilize its brand and taking new measures to
reinvent itself.
 Menu

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d accessible
ell that they are

Back
moditizing” or
s for first place
yalty Survey. In
ks’. Additionally,
he competition
erience" further

by consumers
ain more market
nd othe similar

and image and

measures to
Starbuck's rapid growth and
falling in global brand ranki
of equity, the real indicator
annual revenue suggest tha
build a brand equity and un
example, Toyota's recent re
Starbucks recent decisions
 15. Brand Equity

Starbuck's rapid growth and expansion has caused the company to lose brand equity.
While
falling in global brand rankings and negative consumer reviews are only an
indicator of the loss
of equity, the real indicator is in the poor performance of the company. The same
store sales,
annual revenue suggest that the company is experience challenging times. It takes
years to
build a brand equity and unfortunately it could easily be lost with one or a few
blunders. For
example, Toyota's recent recalls has had a significant impact on it's brand equity.
Similary,
Starbucks recent decisions have not added value to its brand.
 Menu

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d equity. While
dicator of the loss
ame store sales,
t takes years to Back
w blunders. For
uity. Similary,
1. starbucks.com
2. B2Brandebate.com
3. Interbrand.com
4. Starbucks annual report f
 16. Sources

1. starbucks.com
2. B2Brandebate.com
3. Interbrand.com
4. Starbucks annual report fiscal year 2009
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