Fornoles, Layto, Ybanez January 21, 2021

STARBUCKS
Company Profile
Starbucks began in 1971. Back then, the company was a single store in Seattle’s historic
Pike Place Market. From just a narrow storefront, Starbucks offered some of the world’s finest
fresh-roasted whole bean coffees. The name, inspired by Moby Dick, evoked the romance of
the high seas and the seafaring tradition of the early coffee traders. In 1981, Howard Schultz
(Starbucks chairman and chief executive officer) had first walked into a Starbucks store. From
his first cup of Sumatra, Howard was drawn into Starbucks and joined a year later. In 1983,
Howard traveled to Italy and became captivated with Italian coffee bars and the romance of the
coffee experience. He had a vision to bring the Italian coffeehouse tradition back to the United
States. A place for conversation and a sense of community. A third place between work and
home. He left Starbucks for a short period of time to start his own Il Giornale coffeehouses and
returned in August 1987 to purchase Starbucks with the help of local investors. In 1997, the
company established the Starbucks Foundation and opened its first store in the Philippines.
Today, they are privileged to connect with millions of customers every day with
exceptional products and more than 30,000 retail stores in 80 markets. Starbucks went public
on June 26, 1992 at a price of $17 per share (or $0.53 per share, adjusted for subsequent stock
splits) and closed trading that first day at $21.50 per share. Starbucks was incorporated under
the laws of the State of Washington, in Olympia, Washington, on Nov. 4, 1985. Starbucks
Corporation's common stock is listed on NASDAQ, under the trading symbol SBUX. From the
beginning, Starbucks set out to be a different kind of company. One that not only celebrated
coffee and the rich tradition, but that also brought a feeling of connection.
Mission
To inspire and nurture the human spirit – one person, one cup and one neighborhood at a time.
Vision
To establish Starbucks as the premier purveyor of the finest coffee in the world while
maintaining our uncompromising principles while we grow.
The Starbucks Playbook (Challenge)
Starbucks once again faced another challenge as Covid-19 and the deep economic
retrenchment caused the company’s first month-on-month drop in sales since the 2008
financial crash. Their 3rd quarter sales dropped by 40% and lost about $2 billion year on year
were the backbone of Starbucks sales such as office corridors became empty and airport
locations are working barely. Its share price dropped to 20% from its January peak. Amid this
challenge Starbucks responded by creating a “playbook” that is similar to what they have done
to keep the company way back the financial crisis in 2008.
 CEO Kevin Johnson focused on championing speed and convenience were in
construction of drive-thrus have been accelerating and pick-up points have been introduced.
Thus, shifting the once experiential model that made Starbucks what it is, a glorified food truck.
They also introduced digital touchpoints like mobile orders and Starbucks Rewards loyalty
program and this has caused the increase in customer engagement and demand in the last
quarter of the year 2020. Their loyalty program became the key advantage of the company
during the pandemic. Almost 44% of company’s business comes from the loyalty program and
90% of sales volume in the 3rd quarter came from drive-thrus and mobile app, thus showing
that customers are adapting the new routine that Starbucks has set up to. Analysts forecasts
that Starbucks will be back on track and will slowly gain sales by 2024.