Brand Report Card: Starbucks

Building and effectively leveraging brand identity has been a top concern for businesses across all scales, in all sectors and markets. After all, customer satisfaction and earnings flow from high brand value. The benefits of a good brand are obvious. The challenge is that few administrators are willing to take a step back to critically evaluate their brand's strengths and disadvantages. Most people have a decent idea of one or two places where their brand should shine or where it could use some support. Still, understandably, many people would find it impossible to even name any of the reasons they could weigh if pressed. It's difficult to keep all the pieces that impact the whole in mind when you're absorbed in the day-to-day operation of a brand (Keller, 2000).

The brand report card by Keller puts forward ten criteria on the basis of which the performance of a brand is measured. The organisation which is being studied is Satrbucks, which is an American coffee chain. Starbucks opened in the state of Seattle in 1971, but it was under the tutelage of Howard Schultz in 1987, that it became the global giant that it is now. At present, the coffee giant is the largest coffee house chain in the world, with 24,058 stores worldwide (starbucks.com/about-us/company-information; knoema.com). The following report will expand on the brand report card of Starbucks in an attempt to understand how the brand has grown so well and captured the market.

1.The brand excels at delivering the benefits customers truly desire.

The coffees consumption among people in the United States of America has been steadily increasing over the years. The National Health and Nutrition Examination Survey showed that 75% of adults in the US drank coffee and hence they have been capturing the market for a long time (Rehm et al, 2020). In this scenario, Starbucks is catering to a market where the goods it is offering is very much in demand.

The reason why Starbucks has succeeded more than its counterparts is because it realised the importance of not just offering the coffee, but also the ambience. Starbucks shifted its attention to a few years ago to creating a new café-like coffeehouse concepts, in part because they had seen how popular they were in Italy. In addition, the firm was in charge of the selection, sourcing, roasting, and mixing of the coffee from the beginning to the end—overseeing everything all of it from the process to how it was finally brewed and consumed. Despite the lack of vertical separation, intense vertical integration has served us well. However, Starbucks locations so far have proven popular by using all five senses—grinding the scent of the coffee beans, brewing coffee, featuring attractive decorations, and playing smooth music in the background, along with fine tunes and tidy surroundings (Keller, 2000).

2. The brand stays relevant

Keeping rivals obsolete by creating products so creative that they include "must haves" that identify a new group or subgroup is the brand relevance path to strategic success. Things you absolutely need in order to do good business will include the criteria such as your personality, corporate principles, social services, and expressive benefits (Aaker, 2012). Starbucks has managed to do that by keeping up with the tastes of the customers, whereby they consistently keep introducing new flavours and varieties of drinks, provide people with services they look for (free wifi for customers, seasonal drinks, fast moving lines to busy customers, apps for people to order in and pick up their drink from the shop without waiting) and these are the reasons why people keep coming back there (Hennessey, 2012).

3. The pricing strategy is based on consumers’ perceptions of value

In 2020, Starbucks increased their beverage prices by 1% in all of the outlets in US. It was change that was hardly noticeable by the people across the country, however it had a significant impact whereby it resulted in a revenue increase of almost 11% of the company. The company does not worry about price increase, because they understand their customer and the fact that they want quality coffee. Price hikes in the company's history have now deterred the most price-sensitive consumers, leaving a committed, relatively high-earning client base who sees these coffee drinks as a reasonable luxury. Starbucks increases prices to cover for sales losing to cheaper options such as Dunkin Donuts, in order to maximise profits from these cost averse customers who have come to rely on their quality gourmet coffee (Dawson, 2020). One of the important factors that Keller held in high regard related to the strategy of pricing of the products, which is intimately related to understanding one’s customer base and accordingly pricing the products (Keller, 2020).

4. The Brand is Properly Positioned

Brands that are well-positioned fill specific niches in the minds of shoppers. In some easily distinguishable respects, they are identical to and distinct from rival brands. In this respect, the most competitive brands keep up with rivals by creating points of similarity in areas where rivals are attempting to gain an edge, while often creating points of distinction in areas where rivals are attempting to gain an advantage (Keller, 2020). Starbuck’s position is unique because its not only about coffee, but also about the experience and the brand itself, making the customer feel good about choosing their brand and not other’s. It aspires to make the Starbucks experience meaningful and enjoyable. This is done not just for the company's clients, but also for its staff and vendors, whom they regard as friends. Starbucks practises environmental sustainability and takes a variety of steps that benefit humanity and the world in general. Diversity, equality, and recognition are also values that the organisation promotes. Starbucks' announcement in 2017 that it will, in the next five years, recruits thousands of refugees as employees (Avetisyan, 2020).

5. The brand is consistent.

Maintaining a solid brand necessitates finding the right combination between marketing activity consistency and the type of transition required to remain significant. The brand's name should not get blurred or misplaced in a jumble of marketing activities that mislead consumers by delivering contradictory messages (Keller, 2020). Just like Starbuck’s consistent strategies. One of them is producing the signs in the stores which are mass produced but look specially made. The way any part of the store emphasises the importance of hand-crafted components is one of the most critical aspects of Starbucks branding. Despite the fact that signage is clearly mass-produced, it never seems to be so. Signage still seems to have been painstakingly handcrafted. Hand-lettering is used wherever possible to give the message a more intimate touch. This focus on hand-crafted communications corresponds to the company's hand-crafted drinks (adwizbranding.com).

6. The brand portfolio and hierarchy make sense.

The brand portfolio is related to the kind of service/goods the brand is offering and the brand hierarchy is related to how well the brand can contain all its sub-brands or products within itself. Starbucks does a good job by marketing their assorted drinks and retail products at different price points. They understand that not everybody can afford or want a $5 latte on a regular basis; certain people just want a cup of coffee, tea, or something else. Starbucks recognises that some consumers want to make their drinks at home, but they lack the required materials and equipment. Their messaging is clear with all of the items they sell, and they do a good job at identifying who their target demographic is with each. Hence, the advantage with Starbucks has over other brands is that they know their demographic very well and hence are able to make appropriate choices (Helgeson, 2021).

7. The brand makes use of and coordinates a full repertoire of marketing activities to build equity.

In the most fundamental level, a product is made up of all trademarkable marketing features, such as labels, icons, slogans, labeling, and signage. Strong brands combine these components to conduct a variety of brand-related roles, such as increasing or strengthening market perception of the brand or its name, and assisting in the strategic and legal protection of the brand. Managers of the most successful companies recognise the distinct roles that various marketing practises can play in enhancing brand value. For example, they may have comprehensive product details (Berthon et al, 2008). The marketing strategies for Starbucks is spread across many platforms, such as television, radio programmes and print ads. In addition to that, it also offers people positive things when they avail their services. Clients who enter Starbucks' Rewards scheme get a variety of perks. Free refills, free meals, birthday rewards, and more are among them. People return to the brand because of the loyalty scheme, which encourages them to share good word about it. The free drink promotion even aids Starbucks in attracting more customers. They are expected to purchase additional items after they arrive (joshmeah.com).

8. The brand’s managers understand what the brand means to consumers.

An important thing about improving the rates of profit of any business is understanding the needs of the consumers intimately and thats what Starbucks has done. Starbucks borrows from the environment itself to create an authentic experience. Starbucks engages with its consumers in a variety of ways, including retail design, or product localization, and incorporates cultural features into each of its locations. Designers can better appreciate their communities by visiting the company's develop offices, which are centrally placed. In Times Square, each shop may have a dramatic feel; in the South, artists may be inspired by a gnarled barn or acoustic blues; and at a beach store, colours inspired by waves crashing may be the new inspiration (Barrett Foster, 2018; nbrii.com).

9.The brand is given proper support, and that support is sustained over the long run.

Keller et al (2011) postulate that brand equity has to be carefully built. Consumers must have the appropriate depth and breadth of understanding, as well as solid, beneficial, and special experiences with the brand in their minds, for brand value to be built. Managers often want to skip over more simple branding concerns, such as achieving the required degree of market recognition, in lieu of focusing on flashier elements of brand building relative to image. Starbucks achieved getting sustained support from the clientele it has by doing the same thing; by giving support themselves. In the previous section, we realised that one of the paramountly important branding decisions that Starbucks made was making its image into a friendly and sustainable one. Apart from that, Starbucks also takes care to outline its sustainability reports and recycling practices on its websites. The brand claims to have implemented strategies like goals to minimise water usage and using Energy Management Systems in their stores in order to minimise their energy costs (starbucks.com).

10. The company monitors sources of brand equity.

In-depth brand checks and continuing brand-tracking trials are used by strong brands often and effectively. A brand audit is a procedure for determining the health of a company's brand.Starbucks is more than just a coffee shop, according to the brand managers. It's a gathering spot or a place to get task undertaken while consuming an excellent commodity. They profit from the fact that their product is a part of a lifestyle. Clients have positive feelings towards the brand, which makes brand managers to represent them (Helgeson, 2021).

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References

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