Starbucks Strategy Project

Strategic Innovation in Product/Service Design with John Zapolski

Students were asked to design a new strategy for Starbucks to improve their retail store experience.

• Erin Moore, Allison Shaw, Catherine Young : My Starbucks Rewards: Good Neighbors Program

  

  The My Starbucks Rewards: Good Neighbors program is a Foursquare-integrated mobile platform that enables charitable giving and rewards social interaction. More specifically, it is an opt-in program that asks customers to donate an extra 5¢ per food/drink purchase to fair trade farmers in exchange for the chance to win valuable prizes and access to exclusive Foursquare badges. The program aims to increase average monthly visits and gain 8.5 million members over three years. If successful, Good Neighbors could generate $1.3 billion in extra yearly revenue and donate $46 million each year to fair trade partners. The program is win-win: Starbucks gains credibility and authenticity with customers, and Foursquare gains visibility and a new platform with growth potential.

  View presentation slides (PDF)

• David Bellona, Kristin Breivik, Sarah Koo, Katy Newton : Power Your Cup

  

  In concert with Howard Schultz’s vision for Starbucks to return to the company’s core values of quality products, corporate responsibility, and coffeehouse experience, we wanted to channel this initiative by reconnecting customers with a new in-store experience. We proposed to create a reciprocating relationship of energy between the consumer and their coffee through the installation of power-generating kinetic tiles in 250 stores throughout North America. By capturing energy from the consumer via these floor tiles, Starbucks could channel kinetic energy back into their products (coffee) that their customers would then consume. Not only could this new relationship be leveraged for customer promotions and marketing initiatives, the floor tiles would cut store energy costs by at least 7% and work in conjunction with Starbucks’ SmartPlanet program, specifically their goal to reduce energy consumption 25% by 2010.

  View presentation slides (PDF)

• JoJo Glick, Adjoa Opoku, Carrie Stiens, Michael Yap : Starbucks Hub

  

  The Starbucks ‘Hub’ concept centers around an entirely new physical model for Starbucks stores, creating places for incubating ideas, extending ‘third place’ culture and revitalizing local communities. Four new, two-story locations, will be developed in four different cities—Chicago, San Francisco, Austin, and New York. The primary facets of the ‘Hub’ concept driving profitability are:

  1. Partnerships with venture capital firms to fund startup businesses and provide collaborative work environments
  2. Provision of co-work space for the expanding ranks of ‘knowledge workers’
  3. Addition to the menu of ‘hyper-artisanal’ coffee, brewed with Clover technology

  Implementation of the ‘Hub’ concept increases average profits earned from .56 M to 6.1 M over 10 years per location promising Starbucks a return to the extraordinary profitability it experienced in formative years. The strategy also creates future benefits for Starbucks from the establishment of vested and long-term relationships with innovative start-up businesses.