• Blonde Joke on Starbucks

    by  • February 4, 2013 • Branding, Leadership, Marketing, Strategy • 0 Comments

    blonde3Last week I slammed Kellogg’s for maligning the good reputation of their Special K brand. Special K has always stood for a nutritious breakfast. This brand name is now on a new flatbread sandwich of egg, cheese and sausage that contains fewer calories than fast food restaurant versions. The entry isn’t my idea of a nutritious breakfast.

    Today, I’m roasting Starbucks for the same mistake. Starbucks recently launched a milder blend of coffee, called Starbucks BLONDE. This entry came as a shock to me. More than 20 years ago I spent the better part of a day with Starbucks CEO, Howard Schultz. At that time, Howard made it abundantly clear that Starbucks stood for dark-roasted coffee. This characteristic was at the core of his brand’s point of difference versus the market leaders, Folgers and Maxwell House. The positioning worked like a charm.

    So why deviate? Like Kellogg’s, Starbucks wants more sales. They know that 40% of American coffee drinkers don’t like dark-roasted blends. That’s a big number that’s awfully hard to ignore. Marketing 101 says, “Never try to be all things to all people,” but at Wall Street’s urging, zealous marketers keep trying to break that golden rule. From the very beginning, Howard Schultz understood and appreciated that a strategy is strengthened when a particular market segment is sacrificed for a greater cause. His greater cause was super-premium brand imagery that garnered lucrative margins.

    The irony is that Starbucks is on track to deliver excellent sales and profits without this blonde joke. The push in China has them at 570 stores in 48 cities. If all goes according to plan, China will be Starbucks’ second largest market by the end of next year with over a thousand stores. Add to this a foray into the single-serve coffee brewer market, more distribution in supermarkets, other acquisitions, and you have Starbucks humming along within its well-defined niche.

    Starbucks, like Kellogg’s is committing the branding felony of applying a valuable trade mark to products that fail to measure up to the brand’s core positioning. Sure, Starbucks has the power to get away with BLONDE, but I recommend you never try this at home. Stay true to your trade mark’s values. The marketing graveyard is filled with brands that lost their way because of errant line extensions, conceived by inept marketers. This felony aside, I remain a big fan of Howard Schultz and this innovative company.

    (Kellogg’s Special K: On a Slippery Slope http://www.ceoafterlife.com/?p=3077)

     

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    Formerlife: CEO of Jacobs Suchard (Nabob, Kraft), Strategy/Branding Consultant. Afterlife: Fortune & Forbes Contributor, Wannabe Novelist.

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