Starbucks Business Communication Practices

Starbucks Business Communication Practices

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Founded in 1971 at Seattle’s Pike Place Market, Starbucks Coffee, Tea and Spices, as it was originally called, has been “brewing-up” its famous blends in over 43 countries, including the United States. Now called Starbucks Coffee Company, business isn’t just about the coffee and tea anymore. Starbucks has its own line of bottled water, handcrafted beverages, fresh food, entertainment, merchandise and a Starbucks Card. The company has received numerous awards for their outstanding business practices. Fortune Magazine has ranked them as one of “The Best 100 Companies to Work For” in 1998, 2000, 2002, and 2008 (Starbucks, 2008). The Starbucks Experience provides consumers and the general public a direct line a of business communication. From friendly baristas to press releases from CEO Howard Schultz, Starbucks keeps its “partners” informed.
The structure of Starbucks business communication is exceptional. Rather you are in their store buying a Caramel Frappuccino®, visiting their website or watching one of their advertisements on television; as the consumer, the message is loud and clear. Pick up any newspaper and you are likely to find an article about the coffee giant. Starbucks pledges a commitment to their over 172,000 partners (employees) and the community. “We realize our people are the cornerstone of our success, and we know that their ideas, commitment and connection to our customers are truly the essential elements in the Starbucks Experience” (Starbucks, 2008).
Visit Starbucks.com and you enter a virtual world of delight. Consumers can “sample” over 30 blends of coffee; find Starbucks coffeehouse locations, or learn about Starbucks Hear Music®, where customers can “burn personalized CDs, use listening stations to explore musical recommendations, enjoy a handcrafted Starbucks® beverage, or surf the web at (a) T-Mobile Wi-Fi enabled coffee bar” (Starbucks, 2008). Starbucks uses their website to communicate with their consumers about their company’s mission, social responsibility, business ethnic and compliance, diversity relations and press releases. Consumers can even read about the latest “rumor responses” that Starbucks wants to clarify about misinformation regarding the company. From the “click” of a button you can shop for Starbucks merchandise or check the balance on your Starbucks Card, the Starbucks website has got their customers needs in mind.
Advertisements are the key to gain business and promote a company’s product or services to its consumers. Starbucks is no exception. The coffee giant is “out there;” from television ads to it own line of entertainment.

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In 2004 until January 2008, XM Satellite Radio broadcast Starbucks Hear Music®. According to Seattle Post-Intelligencer’s website, in November of 2007 Starbucks came to the decision to promote their first national television advertising campaign after sales plummeted following a sales increase in July and slow business. “However, a defiant Chairman Howard Schultz said the world’s largest coffee chain would fight off competitors and bring customers back. ‘As a national leader, we have an opportunity to make sure our voice is heard in all-important media of T.V. This is the beginning of a new opportunity for us, Schultz said during a conference call. ‘We are up for the defense, and we will get on the offense’” (Harris, 2007). The Internet hosts a World Wide Web of advertisements. If you missed the latest television ad, you can go to such sites as You Tube or try “googling” it; chances are you will be highly successful.
Starbucks has been both praised and criticized for its recent business communications. In an article published by Public Relations Tactics, they examined how Starbucks handled the closure of 600 U.S. stores, “eliminating as many as 12,000 jobs, which is about 7 percent of the company’s work force worldwide” (Schade, 2008). They believed Starbucks to be doing well in the areas of: telling their employees first; taking responsibility; communicating promptly and clearly; leadership accountability; looking for the positive; and reengaging employees who remain with Starbucks. When Starbucks launched their first ever television advertising campaign in 2007, critics were quick to jump in. The Nation’s Restaurant News claimed, “Starbucks’ first national T.V. spots are heavy on kindness, a little light on product message” (Cebrzynski, 2007). Although the reviewer enjoyed the simple, yet creative ads, he believed that “the spots (didn’t) give consumers who (had) never been to Starbucks a reason to finally come on down. They already know Starbucks sells coffee, but they’ve avoided the chain because they don’t care for its coffee. Lapsed users who see the spots might wonder what’s so new at Starbucks that would inspire them to be customers again” (Cebrzynski, 2007).
The strengths of Starbucks business communication practices are modeled in their guiding principles: “Provide a great work environment and treat each other with respect and dignity; embrace diversity as an essential component in the way we do business; apply the highest standards of excellence to the purchasing, roasting and fresh delivery of our coffee; develop enthusiastically satisfied customers all of the time; contribute positively to our communities and our environment; and recognize that profitability is essential to our future success” (2008).
With over 43 coffee houses worldwide, Starbucks promotes it products and strives to use its company to make the world a better place. Visit any Starbucks coffeehouse and you will be greeted by a friendly barista to take your order, and one to pick it up. From my personal observations here in the State of Hawaii at three separate locations, all displayed the same courtesies to their customers. To better the communication with their customers, Starbucks has launched a new website where “consumers can promote their own ideas or gripes at MyStarbucksIdea.com” (Kiviat, 2008). Starbucks utilizes its website often to communicate with both the public and the media. In a press release, CEO Howard Schultz writes a letter to all partners to transform the Starbucks Experience with a “transformation agenda communication #1.” This includes re-igniting the emotional attachment with their customers by restoring the connection, expanding their presence around the world, and re-aligning leadership structure (Starbucks, 2008).
The weaknesses of Starbucks business communication practices are the lack of advertisements in the media. Starbucks didn’t promote their first television campaign until 15 years after going public in 1992. From my personal observances here in the State of Hawaii, there are more Dunkin Donuts commercials played on T.V. then there are Starbucks; the problem is – there are no Dunkin Donuts in the State of Hawaii! In collaboration with companies such as T-Mobile and AT&T, Starbucks was recently sued by T-Mobile claiming that they were “secretly colluded with AT&T to offer free Wi-Fi Internet access in its cafes despite an exclusive agreement with T-Mobile” (Reuters, 2008). If this is the case, then the communication skills displayed here are extremely poor and lacking on Starbucks behalf.
Some solutions for Starbucks business communication practices are to advertise more often instead of waiting for the holiday season or other special occasions. Fifteen years was a long time to wait for a television advertising campaign. The company seems to be growing at an alarming rate and with that amount of success comes a great deal of responsibility; Starbucks needs to maximize its communication to all its “partners,” as they refer, to be effective and efficient in achieving their goals. Another solution that Starbucks should seek is their website; it is a terrific outlet to conduct business communication and allows consumers to provide feedback about their products and services.
Starbucks is phenomenal when it comes to corporate social responsibility. I think that they would be great at being sponsors for literacy programs, PTA fundraisers, and recycling programs. In 2006, Starbucks “recycled in 79 percent of their U.S. and Canadian stores where (they) control waste and recycling” (2008). In 1997, Starbucks established the Starbucks Foundation. “The Foundation has maintained a focus on improving the lives of youth through its support of literacy and nontraditional education programs. To date, the Foundation has provided more than $11 million to more than 700 organizations” (Starbucks, 2008). I don’t think that Starbucks should have a specific individual to be their spokesperson for their sponsored events; part of what makes Starbucks unique is their caring and commitment to their community; and if they had a spokesperson, then that would take away from that perspective. Starbucks interaction with the press and public has been sufficiently established; so, if they were to sponsor any events, there would more than likely be support from both the public and the press.
There are several challenges that Starbucks has faced and will continue to face as our society faces an uncertain economic future. The cost of fuel and our most recent financial crisis here in the United States has caused a ripple effect for many organizations. Globally, Starbucks has helped alleviate the world water crisis by joining forces with H2O Africa with their Ethos Water. “For each bottle of Ethos™ water sold, US$0.05 and C$0.10 is directed to the Ethos Water Fund, which is part of the Starbucks Foundation” (Starbucks, 2008). Another example to their grandeur is when Starbucks recently closed 600 stores, the company held together its own and is still one of the top-selling coffeehouses in the world.
In conclusion, the business communication practices of the Starbucks Coffee Company are outstanding. They take great measures to provide consumers the best Starbucks Experience possible; offering an interactive website, coffeehouses in over 43 countries, advertisements, and community programs that reach around the world. While there are strengths and weaknesses to the business communication practices of Starbucks, they continually have shown us time and time again that they are a strong, profitable organization with innovative ideas committed to our communities and our environment. In the end, Starbucks is a partnership that we, as consumers, can share our ideas and they will listen. The Starbucks Experience is like no other; it’s more than coffee, it is about the here and now.


References:
Cebrzynski, G. (2007, December 17). Starbucks’ first national TV spots are heavy on kindness, a little light on product message. The Nation’s Restaurant News, 41(50), 18-18. Retrieved October 5, 2008, from Business Source Elite database.
Harris, C. (2007, November 16). Its U.S. traffic slowing, Starbucks to run first national TV campaign. Seattle Post-Intelligencer. Business. Retrieved October 5, 2008. http://seattlepi.nwsource.com/business/339851_sbuxearns16.html
Kiviat, B. (2008, April). Wake Up and Smell the Coffee. Time, 171(14), 46. Retrieved October 5, 2008, from ProQuest Nursing & Allied Health Source database.
Reuters. (2008, June 6). T-Mobile Sues Starbucks over AT&T Internet deal.
http://www.reuters.com/article/internetNews/idUSN0631262620080607?feedType=RSS&feedName=internetNews&pageNumber=1&virtualBrandChannel=0
Schade, J. (2008, August). Bitter News: How well is Starbucks communicating its Layoffs? Public Relations Tactics, 15(8), 10-10 Retrieved October 5, 2008, from Business Source Elite database.
Schultz, H. (2008, January 7). Howard Schultz Transformation Agenda Communication #1. Press Room. Starbucks Coffee Company. http://www.starbucks.com/aboutus/pressdesc.asp?id=814
Starbucks. (2008, February). Company Profile.
Starbucks Coffee Company. http://www.starbucks.com/aboutus/Company_Profile.pdf
Starbucks. (2008, February). Company Factsheet.

Starbucks Coffee Company. http://www.starbucks.com/aboutus/Company_Factsheet.pdf
Starbucks. (2008, February). Company Recognition.
Starbucks Coffee Company. http://www.starbucks.com/aboutus/Company_Recognition.pdf
Starbucks. (2008, March 6). Ethos Water and H2O Africa Join Forces to Help Alleviate the World Water Crisis. Press Room. Starbucks Coffee Company. http://www.starbucks.com/aboutus/pressdesc.asp?id=841
Starbucks. (2008). Hear Music.
Starbucks Coffee Company.
http://www.starbucks.com/retail/hearmusic_jump.asp
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