Series of strategic planning sessions at Starbucks

E-Commerce

In July of 1997 subsequent to a series of strategic planning sessions Starbucks took the decision to create a Website, which was completed in fifteen months in collaboration with Organic Online. The purpose is to project the Starbuck’s story and share it with its customers both existing and new. The objectives include branding, e-commerce and customer communication and this idea rests on meeting experiential and utilitarian goals. This site provides the opportunity to exploring, browsing and learning about Starbucks on one side and on the other side like shopping, locating a store or looking for a job. (Starbucks.com)

The new online strategy analysts believe will help Starbucks extend its brand image to a larger range of audience than just its coffee-retail market. Many of the current Web portals are just information-based and hardly offer any brand identity. The Starbucks portal will draw customers to it because of its unique character and personality. The portal’s e-commerce part is a combination of the current line of activity and also offers links to other businesses like Drugstore.com and eBay. The content side is focused on lifestyle and arts and music reviews and includes message boards. (Starbucks to launch portal site, report says)

By using core branding, icons, animation, copy and color the four sections gain a unique quality. The Store is the most dynamic aspect of the site and uses a Brew icon, while the Roast icon is used to differentiate the Coffee section. The Bean includes several products and uses the Aroma icon and the Company section with information on Starbucks uses the Grow icon. Besides iconography, hand drawn Starbucks murals have been used on the home page and the global tool pages to distinguish them. The design also caters for seasonal changes as seen on the home pages and the icons used in the Store are used seasonally to bring the Starbucks message a complete circle from stores to the site. The navigational structure permits one to either browse or gain direct access. The home page has four sections and these are clearly shown with global utilities and access to the sections, which include Store Locator, Jobs, Business Services, FAQs, Contact Us, Register a facility for site search. The flow through the site is smooth with in each. (Starbucks.com)

Starbucks in 2002 put in a drive to make wireless access with T1 speeds available across 1,200 of its U.S. And 2,000 of its European outlets before the end of the year. This initiative was a three-way project between Starbucks, T-Mobile International, the wireless subsidiary of the German Deutsche Telekom and Hewlett-Packard. This alliance based on Starbucks previous relationship not only increases the wireless footprint of T-Mobile but also makes Starbucks the largest WiFi network supplier in the U.S. (Starbucks Serves Up WiFi Access) Starbucks launched a new service in the spring of 2004 to provide customers the facility to listen to over 250,000 sings with the help of a HP tablet and then create a CD of the songs they like the best for $12.95. This service was created to strengthen the Starbucks eclectic brand experience. Other music retailers do offer the same set of services, but it is expected that customers would prefer to sit down in a comfortable chair and listen to music, while sipping a cup of coffee, before making the selection than standing uncomfortably at one of the listening stations of the competitors. (Starbucks to Offer Music Burning Service)

The huge coffee retailer launched a foray into e-commerce with the signing of an e-commerce agreement for five years with Internet home delivery service Kozmo.com. Kozmo has agreed to pay Starbucks $150 million for utilizing Starbucks 2100 retail outlets for in-store promotion. Some of the other measures are that Kozmo will place drop boxes at Starbucks stores to cater to video returns and Kozmo will also deliver Starbuck’s roasted coffee by the pound against orders received over the Internet. It is expected that this agreement will lead to other online ventures that could include hot beverage delivery and the development of new products and services. Kozmo at the moment provides one-hour delivery of videos, books, magazines, meals, snacks, and beverages in the cities of New York, San Francisco, Boston, Seattle and Washington. (Starbucks Tiptoes into E-Commerce with Kozmo Alliance)

Starbucks has launched a new magazine called Joe and the necessary Website for it. An added feature would be the facility of traditional conversation available exclusively across the Starbuck’s stores in North America. Excerpts would also be made available online at www.joemag.com.Joe is a joint effort between Starbuck’s and Time Inc. Custom Publishing. The Managing Editor of Starbucks believes those general interest magazines and the magazines of ideas and writings could get missed out at the cluttered newsstands. Starbucks provides an excellent opportunity for Joe, as Starbuck customers are usually interested and curious. They make an excellent target audience for a magazine that is aimed at exploring the important, the beautiful, the funny and the provocative. Joe is a demonstration of Starbuck’s intent to incorporate the Web into its successful brick-and-mortar coffee shops. In the current state of booming Internet economy Starbucks is intent on using this opportunity to forge a new profile beyond that of a coffee retailer. (Starbucks Unveils Web Plans: Starbucks can sell an expensive cup of coffee, but what about a magazine)

There is a need for change of direction in the e-commerce strategy of Starbucks. They possess a website that is rich in content, can be navigated with ease and provides enough information, but do not use it efficiently. To increase offline sales Starbuck’s Starbuck should use the website as a tool to create value to its well-entrenched customer experience brand. For this awareness has to be increased for those customers visiting their site through more effective advertising. They also need to increase the customer reliance for the site by sales promotional activity tied to their latest innovation the Starbuck’s Card. The new music initiative tied up to starbucks.com would give them added advantage. It would also prove useful in removing any confusion that may exist at the site, by to another established. (Starbucks.com: eStrategy)

References

Conlin, Rob. “Starbucks Tiptoes into E-Commerce with Kozmo Alliance” February 14, 2004. Retrieved at http://www.technewsworld.com/story/2504.html. Accessed on 11/29/2004

Farmer, Austria Melanie (May 12, 1999) “Starbucks to launch portal site, report says.” Retrieved at http://news.com.com/Starbucks+to+launch+portal+site,+report+says/2100-1017_3-225740.html. Accessed on 11/30/2004

Habermann, Christian; Mattis, Andrew; Medvedowsky, David; Olivia, Nash. (May 5, 2004) “Starbucks.com strategy” Retrieved at http://elab.vanderbilt.edu/research/papers/pdf/student_projects/Final%20Report%20Starbucks.com.pdf. Accessed on 11/30/2004

Hall, Steve. (March 11, 2004) “Starbucks to Offer Music Burning Service” Retrieved at http://www.marketingvox.com/archives/2004/03/11/starbucks_to_offer_music_burning_serviceAccessed on 11/29/2004

Singer, Michael. (August 21, 2002) “Starbucks Serves Up WiFi Access.” Retrieved at http://siliconvalley.internet.com/news/article.php/1450471Accessed on 11/29/2004

Starbucks.com” Retrieved at http://www.designinteract.com/sow_d/113098/. Accessed on 11/29/2004.

Starbucks Unveils Web Plans: Starbucks can sell an expensive cup of coffee, but What about a magazine”? Retrieved at http://www.morebusiness.com/getting_started/website/d930585515.brcAccessed on