Going through my usual browsing through Facebook’s newsfeed, I came across an article link one of my classmates back from High school had shared. “Starbucks…beer?” She titled it. The article struck me right then about Brands and how sometimes they go over the top with their new product launches, brand extensions and advertising but surprisingly manage to get away with it.
Let’s rewind a couple of months back with the launch of Apple’s most recent product – the iPad. Although before the actual launch there was an emergent outcry and dismay by the experts and Apple-lovers alike, I couldn’t help notice how surprisingly successful it was. Everywhere I went and looked, the iPad was out of stock or sold out. I frequently started noticing in people’s hands be it managers, CEOs, designers and even high school kids. It was after all a glorified and overblown iTouch. It had no extra value; it was LIKE a small laptop without any of its key features such as usb ports or DVD rom. Let’s face it, if I wanted to use it for games or checking my email, I would do it on my PC and blackberry, respectively. I just did not see the point of it but apparently people did and it has been relatively a huge sensation.
Now coming back to Starbucks’ announcement to dive into offering beer and wine only makes me contemplate 4 words – what are they thinking? Didn’t they ever hear of the old adage “stick to what you do best”? Although I am not even sure what makes Starbucks the ‘best’ but that’s another story.
It can be argued that diversification can have positive ROI for companies but only if it stands to strengthen and support the parent brand. I feel that companies sometimes forget the key element behind branding - its not just your offering, its not just a logo that people remember but its a set of values and connection you have with them. Branding is also about unity - that every single element and soul that goes into making the brand fits together as a whole.
Starbucks being in the F&B category has specialized in offering high quality coffee and related condiments – that is what the brand has always been about. They continue to try to expand into newer and newer products and offerings without really perfecting existing ones as mentioned in How Starbucks growth destroyed brand value. To me the coffee itself is overrated and overpriced. Instead of attempting to refocus and improve on its coffee and the brand experience it creates in its shop, it decides to move into uncharted territory of beer and wine. The two are opposite ends of spectrum – coffee and alcohol. What’s next? Tobacco? Or maybe their promotion could be “Have a beer at Starbucks and cure your hangover with our coffee”.
It is obvious they are trying to be everything to everyone, which will ultimately destroy their brand value. All it will do is confuse their customers and eventually drive them away. Or could it be another iPod-like case.
Will brands continue to abuse people’s curiosity and hope for a band-wagon affect, which drives consumers to buy their products? But I ask is that respectable brand values? Is it a sustainable strategy or will we witness a fall of another brand giant?
