Recreating Starbucks

Starbucks may need a sip of its own espresso. In the past year and a half, the company’s stock tumbled from almost touching 40 to falling short of 20. Chairman Howard Schultz may have accidentally caused shareholders to lose confidence in the company when his memo, criticizing the company’s “brand dilution” and “cookie-cutter” type store layouts, leaked onto the web. So what can this industry leader do to maintain its market share and growth?

Remember the Experience
Starbucks launched the idea of a “third-place,” saying people occasionally want to escape stress at home and work. Their coffee shops attempt to fill the void with flavorful aroma and an understated soundtrack. Starbucks’ alternations within their stores should remind customers of this experience that they used to enjoy.

Get Back to Basics
After experiencing tremendous success in coffee, Starbucks moved into manufacturing consumer products from espresso machines to coffee mugs and water bottles. They also released a line of alcoholic beverages, as well as distributing music albums and feature films. Perhaps this loss of focus, with an incredibly fast rate of expansion, contributed to the company’s dilution.

Yet even with the trouble Starbucks and its shareholders have seen during the past year, very few people have lost hope in Schultz’ guiding philosophy. He may be the Steve Jobs of designer drinks. Regardless of his strategy, the actions Starbucks makes from this point forward will live in textbooks as a case study for years.