STARBUCKS EXEMPLIFIES TRUE INNOVATION

 

Beginning with a single store in 1971, Starbucks grew to over 12,000 locations in 57 countries in 2006.

 

Starbucks did not set out merely to make a better cup of coffee. That was the old way of looking at the

coffee retail business.

 

Instead, the executives had a much bigger idea: to make Starbucks a destination between the home and

the office – a place where people can find a respite.

 

Starbucks delivered, not just better coffee than the average restaurant, but a shared community

experience. The atmosphere made it easy to relax with a comfortable 'stay as long as you like' setting which

included Internet access. Starbucks became the extended living room, the familiar meeting place in a

strange city, the way-station to escape from the corporate cubicle and the place for students to

stop between classes.

 

They did much more than simply crush, boil and filter a sack of coffee! They changed customers’ expectations.

 

Much of Starbuck's innovation had to do with marketing, not product. Starbucks came up with an insider

'mystique' by inventing a new language for size: tall, grande, and venti instead of small, medium and large –

along with endless variations on what is essentially the humdrum old theme of coffee and milk.

 

Starbucks makes you feel like a knowledgeable consumer by telling you the flavour difference between

Ethiopian and Guatemalan coffees.

 

And the third time you visit the shop, the barista generally knows your preference!

 

Starbucks brings you the romance of the coffee experience!

 

Source: The Definitive Drucker, Elizabeth H. Edersheim.

ISBN 978-0-07-147233-3

(Recommended at the Accounting and Finance Conference, Sydney, March 2017)