Starbucks' Logo Mishap: 5 Miscalculations To Use As A Warning



Yesterday I learned the shocking news that Starbucks is destroying its logo in the name of brand expansion. As a dedicated Starbucks fan for more than a decade, and as someone who spends a lot of time studying brands, I felt my stomach sink. It was like watching Titanic (except without having to suffer through Kate Winslet and Leonardo di Caprio on TBS for the fiftieth time.)

Immediately I Tweeted the equivalent of "Nooooo...please change your mind!"

It didn't take long before the anti-logo-change articles and blog posts started to flow. If you have time to read them, a few good ones highlighting the mistaken thinking behind the change are online at Branding Strategy Insider, Fox News, and Forbes. CoreBrand's CEO James Gregory put it especially well: "Chief executive Howard Schultz has the right idea about evolving the logo. His solution however shows some of the hubris that got the company into trouble a few years ago."

Exactly. Starbucks' move reflects not only lack of self-awareness, but also arrogance. They are in love with the "siren" (oy, give me a break, it's just a green graphic of a mermaid that looks like an octopus!)

The quote from Schultz in The Wall Street Journal makes him sound absolutely insane:
"Even though we have been and always will be a coffee company and retailer, it's possible we'll have other products with our name on it and no coffee in it."
Say what? Like - has he not been to Starbucks lately, where they sell quite a variety of food without coffee in it?

Or to the grocery store to pick up a container of Starbucks Vanilla Bean ice cream?

The statement by Schultz on the Starbucks website elaborates:
"Our new brand identity will give us the freedom and flexibility to explore innovations and new channels of distribution that will keep us in step with our current customers and build strong connections with new customers."
Whoa. This is such a colossal error in reasoning. They have other options.

I've been glancing at the Tweets - bad. The Forbes blog quotes one survey stating that 70% of respondents like the old logo better.

What do we get that Schultz and his team don't?

To get the answer all you have to do is watch the pilot episode of the megahit TV show Friends. The very first scene is "Central Perk," which is really a euphemism for Starbucks. Central Perk, like Starbucks, represented an affordable let luxurious, comfortable, neutral gathering place for the friends outside their respective homes.

In Central Perk, the six friends could experience some brief happiness together - relief from the trials and tribulations of life - by sharing a steaming, delicious cup of coffee.

Friends premiered in 1994, and wouldn't you know it - it was around 1995 that the stock price of Starbucks began to take off. (You can customize the chart in in the link to go back 20 years.)

In fact, the brand essence of Starbucks is very close to the brand essence of the show Friends. It is about a coffee-centered "third space." This is the main reason why removing the words "Starbucks Coffee" from the brand is such a disaster. The company has literally destroyed its own equity.

Let's sum up the 5 fundamental miscalculations involved in this decision.

1: They miscalculated where the equity of the brand resides. It's not in the picture. It's in the words.

2: They miscalculated the best way to handle inevitable decline. There are many options. As I stated back in 2007:
"Today, the Starbucks brand is extracting the absolute most it can from its brand equity. It is at the top of the hill. It has nowhere to go but down. The company should pull back and create another, new brand 'from the makers of Starbucks' which redefines the coffee category and gets back to the essence of what Starbucks used to be all about."
Some ideas:
  • Destroy the brand (as above) and create a new one - like Oprah did with her TV show, putting it to rest and starting a new cable TV network.
  • Take the most valuable element of the core brand (the words "Starbucks Coffee") and creating a super-premium brand, while doing something to make the core brand more appealing on a mass level - e.g., expanding the food, merchandise, magazines, and other items for sale.
  • Focus attention on Seattle's Best and other excellent coffee options - developing a portfolio of coffee-related brands each with a certain brand offering related to the original Starbucks promise.
  • Develop a Starbucks Management School where the company's philosophy of employee engagement could be taught to executives of other companies.
...and on and on.

3. They miscalculated the brand equity in the "siren." As others have pointed out, a swoosh she ain't. As marketing expert John Tantillo, principal at Metzger Tantillo Marketing, put it in his post for Fox: "we think and say the WORD 'Starbucks'... we don't think and say, 'green blotch with mermaid symbol.'"

4. They miscalculated the quality of the design of the siren. Let's face it, the image is not great. First of all, it doesn't say anything. Second, it's complicated. Third, it's unappealing. Fourth, and most bothersome to me, it's actually OPEN at the edge. There is no border around the image. It seems like they forgot to finish it.

5. They are generally drinking their own Kool-Aid. It's almost unbelievable, how egocentric this company is. The video at the top of the Starbucks homepage announcing the change is - guess who? Howard Schultz!

And the company's blog posts...well read this excerpt from the January 5 corporate blog post, "Bringing the Siren to Life" for yourself and tell me if you don't smell the b.s. wafting up from Corporate Communications:
"When we first heard about the possibility of modifying the Starbucks brand identity, our minds went wild with the possibilities. This was the project of a lifetime. The designers here at Starbucks have such a love for this brand – it’s what drives our creativity."
This propaganda-ish tone offends me, as it comes from a company that has defined branding for me for what seems like most of my adult life. In this day and age, they could have been secure enough to post something a little more genuine. Like maybe a post saying that he wasn't so convinced at first?

The bottom line is, brands lose their way when they lose touch with reality. While everything and everyone grows old and dies, it is possible to stay vital for a long time by continually mining your brand essence for new ways to delight the customer.

Sadly it seems like the company is succumbing to ego, greed, bad advice, Schultz being too close to his own business, or simply having held the same job for too long. He can't see clearly that what we want out of Starbucks is not the coffee itself, but the memory of having gone to that special place where we can grab some time to relax, read the paper, and share a good memory with family and friends.

I hope that when Facebook goes public, it doesn't suffer the same fate.

1 comment:

Stephen Byrne said...

I don't really agree with you, Dannielle. A brand is not a logo, you know that. I think Starbucks does understand its equity and their move to the "maiden" identity is, based on that, not a miscalculation. Take a look at their share price (its x3) & their reorganisation as well their new moves to create alternative (third) spaces both in the US & Japan. You'll see this move enables the kind of flexibility that companies like Apple & Nike already have with their logos & brands. I don't need to tell you how successful these evolutions have been. Many in the US are mired in very old mindset around Starbucks' brand (hence the Friends analogy) and it's time they understood that brands change & do need to.