Starbucks' marketing strategy

Communication

According to Howard Schultz's book Pour Your Heart Into It: How Starbucks Built a Company One Cup at a Time, the name of the company was derived from Moby-Dick, although not in as direct a fashion as many assume. Gordon Bowker liked the name "Pequod" (the ship in the novel), but his creative partner Terry Heckler objected: "No one's going to drink a cup of Pee-quod!" Heckler suggested "Starbo," the name of a mining camp on Mount Rainier. Combining the Moby-Dick idea with "Starbo" resulted in the company being named for the Pequod's first mate, Starbuck.

The company logo is a two-tailed siren. The logo has been streamlined over the years. In the first version, the Starbucks siren had bare breasts and a fully-visible double fish tail. In the second version, her breasts were covered by hair, but her navel was still visible, and the fish tail was cropped slightly. In the current version, her navel and breasts are not visible at all, and only vestiges remain of the fish tails. The original logo can still be seen on the Starbucks store in Seattle's Pike Place Market and on Starbucks Anniversary Blend 1 lb coffee bags.

At the beginning of September 2006, Starbucks temporarily reintroduced their original brown logo on paper hot beverage cups. Starbucks has stated that this was done to show the company's heritage from the Pacific Northwest and to celebrate 35 years of business, however the vintage logo has sparked some controversy due to the siren's bare chest.

Recently, an elementary school principal in Kent, Washington was reported as asking teachers to "cover up" the mermaid of the retro cups with a cup sleeve of some kind.

Marketing

Starbucks' marketing strategy involves positioning the local Starbucks outlet as a "third place" (besides home and work) to spend time, and the stores are designed to make this easy and comfortable. The café section of the store is often outfitted with comfortable stuffed chairs and tables with hard-backed chairs. There are ample electrical outlets providing free electricity for patrons using or charging their portable music devices or laptop computers. Most stores in the U.S. and in some other markets also have wireless Internet access (although this access is not free, as it is in some independent coffee shops).

The company is noted for its non-smoking policy at all its outlets, despite predictions that this would never succeed in markets such as Germany, where there are otherwise few restrictions on smoking. Outlets in Vienna and Mexico City , which have smoking rooms separated by double doors from the coffee shop itself, are the closest the company has come to making an exception. According to the company, the smoking ban is to ensure that the coffee aroma is not adulterated. The company also asks its employees to refrain from wearing strong perfumes for similar reasons. Starbucks generally does not prohibit smoking in outside seating areas.

Starbucks does not generally offer promotional prices on its products. It has a repututation for having pricey drinks, though as of early 2006, Dunkin' Donuts charged even more for a large cup of coffee ($1.95 vs. $1.80 at Starbucks). In late 2006, Starbucks announced that it would raise prices by $0.05 USD, at the beginning of the new fiscal year, October 2, 2006.

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