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Live from the ANA Brand Forum: Starbucks Brews Success

By Apr 25, 2007

Starbucks knows what it takes to transform an ordinary coffeehouse into a mega success: a different approach.

Anne Saunders, senior vice president, global brand strategy and communications, Starbucks Corp. said customers know that the company is more than just about coffee.

The goal? “To provide an uplifting experience in people’s daily lives,” she said.

The 35-year-old company spends less than 1% of its annual revenue on marketing, Saunders told attendees. Of that, 50% is spent in-store and 25% is earmarked toward product sampling, she said. The reminder goes toward the company experience, which includes philanthropic initiatives.

Since 1999 when Starbucks bought its own music company, Hear Now, the chain has transformed itself. While still tops for its coffee and lattes, it’s now recognized for its music offerings, Saunders said. Last week, the company added its own section to Apple Computer’s iTunes Web site. In addition, the coffeehouse lets customers buy select CDs in-store.

For Starbucks, innovation “is in our DNA,” Saunders said.

Beyond music, the company is also blending online gaming with social causes. In honor of Earth Day, the chain last week rolled out an Internet-based game at planetgreengame.com designed to generate awareness of consumers’ impact on the environment. The game, designed by Starbucks and Global Green USA, can be passed along to friends.

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