Case Detail

Case Summary

Starbucks: Driving Growth Through New Dining Occasions

Case Number: 5-218-253, Year Published: 2018

HBS Number: KE1079

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Key Concepts

Branding, Competitive Strategy, Consumer Marketing, Corporate Strategy, Growth Strategy, Market Analysis, Marketing Strategy, Product Management, Strategic Planning

Abstract

In 2008, Starbucks was in crisis as a result of undisciplined growth and loss of focus, and its stock declined almost 70%. In August of that year, Howard Schultz, the founder of Starbucks, came out of retirement to take over as the CEO. The company regained its footing by refocusing on its core and driving strong organic growth. By 2014, the stock price had reached $40, an all-time high. To prevent history from repeating itself, Schultz wanted to ensure that Starbucks' growth strategies not only addressed market opportunities, but also were aligned with the company's brand image, assets, and capabilities.

Starbucks announced a five-year growth plan in December 2014 with ambitious goals that included nearly doubling its revenues from $16 billion to $30 billion, doubling operating income, and expanding its footprint to more than 30,000 stores globally by 2019. The growth plan consisted of seven specific growth strategies, one of which was the New Occasions strategy. The objective of New Occasions was to drive growth by diversifying Starbucks' revenues beyond breakfast to the lunch, afternoon, and evening dayparts. Starbucks created specific offerings for each daypart, called the Lunch, Sunset, and Evenings programs. The case focuses on evaluating these three occasions-based growth opportunities and identifying the best path forward.

Learning Objectives

After reading and analyzing the case, students will be able to identify growth opportunities by applying the "Jobs to Be Done" (JTBD) framework to generate customer insights; assess growth opportunities using an opportunity analysis framework; and understand the importance of disciplined growth and appreciate the fact that not all growth is good growth.

Number of Pages: 8

Extended Case Information

Teaching Areas: Marketing

Teaching Note Available: Yes

Geographic: United States

Industry: Non-alcoholic beverages, Fast food

Organization Name: Starbucks

Organization Size: Large