MARKETING FOR PROFESSIONALS 26th August, 2017

BOOK REVIEW

On
THE STARBUCKS EXPERIENCE: 5 PRINCIPLES FOR TURNING ORIDNARY TO
EXTRA ORDINARY – JOSEPH MICHELLI

Submitted To,
Mr.Anand Desai

By

Kshama Shetty-45
Mayur Suthar-49
Dhruta Vyas-53
Vihang Jadhav-
Tushar Deshmukh

(PGDM Marketing)

Chetana’s Institute of Management & Research,

New Bldg., Survey No. 341, Govt Colony, Bandra – East, Mumbai – 400 051.
THE STARBUCKS EXPERIENCE: 5 PRINCIPLES FOR TURNING ORDINARY TO EXTRA ORDINARY

INTRODUCTION

Starbucks is an American Coffeehouse chain founded in Seattle, Washington in the year 1971. As
of November 2016, it operates in more than 23000 locations worldwide. Joseph Michelli had a
personal interaction with the partners at Starbucks for around 18 months before coming out with his
book The Starbucks Experience, where in he has stated 5 principles adopted from Starbucks, which
can be applied to any business to expand it.

5 PRINCIPLES FOR TURNING ORDINARY TO EXTRA ORDINARY

I. MAKE IT YOUR OWN

It is a model that encourages partners at all levels to pour in their creativity and dedication
into everything they do. The leaders at Starbucks developed a pamphlet called as the
GREEN APRON BOOK having a simple structure - FIVE WAYS OF BEING which has
simple instructions in an appealing manner which easily fits into the pockets of their aprons.

1. Be Welcoming
To create recognition, it is essential to create a welcoming experience for the customers
for them to know that they are important and also to turn the infrequent visitors into
regulars which can be achieved by remembering names of people or the drinks they
usually order.

2. Be Genuine
At Starbucks being genuine means to connect, discover and respond. Businesses have to
be connection based and not just transaction based. This connection is achieved by both
verbal and non verbal listening. Discovery is essential to develop a unique and genuine
bond. The partners have to seek an understanding of customer wants and desires.
Starbucks partners not only listen but also respond immediately based on what they hear.

3. Be Considerate
Starbucks not only looks after the well being of its partners but is also globally
considerate. They acquired the Ethos water project in year 2002 where every time it sells
Ethos, 5 cents a taken out for worldwide water project.

4. Be Knowledgeable
Starbucks provides training opportunities and incentives to their partners to gain
knowledge. They spend more on training than they do on advertisements. Every new
employee is given a 104-page booklet called as COFFEE PASSPORT PROGRAM that
has to be completed within first 90 days of employment which has the fundamentals of
brewing coffee, coffee tasting lessons etc.

5. Be Involved
At Starbucks being involved means active participation in the store, in the company as
well as in the community. Starbucks management listens to the ideas and suggestions of
its partners based on the inputs from the customers. They also want their partners to
actively involve in the community by setting up community meeting places, setting up
community events, etc.

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THE STARBUCKS EXPERIENCE: 5 PRINCIPLES FOR TURNING ORDINARY TO EXTRA ORDINARY

II. EVERYTHING MATTERS

It means understanding the power of touch, a smile, a kind word, a listening ear, an honest
compliment. Everything Matters have 7 points under it, which are as follows:-

1. Attention to details occurs by design, not by default

To consistently execute on the minute details which can be experienced when one visits
the outlet. They serve highest level of product quality and excellent customer service.
They take care of both- ‘Below-Deck’ and ‘Above-Deck’ components.

2. Creating an environment for the Starbucks experience

The Starbucks management has taken great efforts in every aspect of the store design,
making sure to balance functionality with a warm and friendly ambience. They started
playing music to comfort their customers and to set a comfortable atmosphere creating a
truly unique Starbucks Experience.

3. Details converge into a “FELT SENSE” about the business

Consistently, people experience Starbucks as warm, comfortable and pleasurable. It has a
relaxed atmosphere, where we can sit for hours and nobody tells you to leave.

4. Never cut corners on quality

Right from ‘Below-deck’ activity freshness of the coffee, products, processes and
services, Starbucks maintains a high level of quality.

5. Prioritizing objectives and keeping them in front of your people

The training programs, the Green Apron Book, the legendary service and other objectives
are prioritized and maintained in Starbucks.

6. Creating a playful corporate culture

They have board games for training purpose. This shows that Starbucks understands that
playful and positive work environment produce vital and engaged staff members.

7. Everyone matters – uniqueness of customers and employees

Various heart-warming employee and customer stories are narrated. This shows how a
customer centric relation and a feel of care can attract them and increase the number of
loyal customers.

III. SURPRISE AND DELIGHT

Cracker jack was consistently a popular treat which delighted the young and old with their
unique confection consisting of popcorns, peanuts. The sale of this popcorn increased when
there was a free Gift assured with these popcorn. Trending now is Happy Meal, Happy hours
concept.

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THE STARBUCKS EXPERIENCE: 5 PRINCIPLES FOR TURNING ORDINARY TO EXTRA ORDINARY

1. When a business "Gets it"

How the organisation should understand its employees and serve them. Introducing new
varieties and serving free drinks for the initial days is completely what a customer is what
rather they expect than ask.

2. Unconventional Surprises are often the best

Unconventional Surprises often is the best way to grab customer attention. Such as
“traveling surprises”, gave away free coffee to all the commuters, by not creating a
marketing gimmick. In a couple of instances, rather than simply buying billboard space,
Starbucks placed regular-size magnetic coffee cups on the tops of cabs. To the
unsuspecting observer, it looked as if a cup had been left there accidentally. Cab drivers
were also involved in the surprise, where they had to give Starbucks gift cards to
individuals who advised them that the cup was there.

3. Joy from unexpected sources

One of the great things about surprises is that their impact can be far-reaching. Not only
do staff members surprise customers, but they also surprise one another.

4. Delight Your Customers

People are pleased when they know that a company will deliver what it promises. And
even when something goes wrong, they go the extra mile to make things right. Delight is
the result of an unwavering commitment to creating a comfortable and trusted customer
relationship.

IV. EMBRACE RESISTANCE

For Growth, Embrace Resistance is all about accepting the negative feedbacks and positive
feedback as a tool to constantly improve the business. A never say no policy is not something
to opt for. We can see this from the example of the famous Taj Mahal Palace Hotel there was
a sandwich on the menu card that read anything you like and charged Rs 900/-* a guest
entered and asked for all meat sandwich with Caviar which was of Rs 35,000/- so this policy
can easily go against and could cost fortune for such companies.

V. LEAVE YOUR MARK

All of us leave some mark on the world. What varies is whether that mark is positive or
negative. Do we give back more than we take, or do we take more than we give? This is
particularly important in the world of business, where the actions of managers have a
profound effect on individuals and society.

1. Social Involvement
Starbucks kept in mind, There should be commitment to community stewardship.
Stewardship includes taking care of their own staff, volunteerism within neighbourhoods,
quality for product providers, economic transparency through the supply chain, large
grants to national community organizations, Starbucks fulfils this as they are committed.

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THE STARBUCKS EXPERIENCE: 5 PRINCIPLES FOR TURNING ORDINARY TO EXTRA ORDINARY

2. Value Driven Approach

People prefer to do business with and work for socially conscious companies.When
employees’ work environments match their personal values, they are more productive.
The participation of employees in community-based activities strengthens their
teamwork, leadership skills, and corporate identity.

3. Building Trust
One must build up trust with employees, investors, customers, suppliers, and their
communities. The Value of any brand is linked with the trust. It is build up by caring for
employees, delivering to customers, producing quality of products, Improving
communities in a way that helps the environment.

4. Packaging of the World

It is a package design which showcases the best, most interesting and creative work
worldwide.

TAKEAWAYS
1. A lot of importance is given to customer needs and customer satisfaction.
2. They have a standardized training system at all outlets and hence the customer service is
consistent everywhere.
3. They provide health insurance to employees working for more than 20 hours a week which is
an excellent employee retention mechanism.
4. They are a public organization and hence have opportunities where in the employees that
work for more than 20 hours a week can buy shares and become a partner.
5. They listen to their employees and hence 82% of the employees working at Starbucks have
job satisfaction.
6. They are very considerate and do not have rigid instructions for their employees.
7. Coming up with innovative Ideas
8. Sensory Branding plays an important role
9. Customer is the king, As well as the employee treating both of them is important
10. Certain telecommunication brands can apply these principles

CRITICS

1. Not every business can afford to spend training more than advertisement like Starbucks
does.
2. By being welcoming, the baristas have to remember the names as well as drinks of the
customers which is too much to ask from the employees.
3. By being genuine, the employees have to connect with the customers on a personal level
but no everyone would be willing to let someone invade their privacy.
4. Since Starbucks is a public organization they give out shares to their employees for
employee retention, but this cannot be applied to small businesses.
5. Starbucks gives a pound of coffee to its employees every week,
6. Again this cannot be adopted by small or new coffee shops.
7. Getting personalised in while delighting the customers can be offending in some areas
8. Not always the experience can be the same Globally due to certain religious factors
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