So ingrained is the Starbucks brand in our culture that it's hard to believe there was ever a time when you could swing a pound of Sumatra beans without hitting a store. There was such a time, of course -- the first store opened in Seattle in 1971, and it was a good couple of decades before the green-and-white sign became ubiquitous. Since then, the brand that has inspired adoration, envy, disdain and customer loyalty of the most intense kind has learned that it needs innovative marketing leaders just as much as the next guy.
Enter Anne Saunders. When Ms. Saunders, senior VP-global brand strategy and communications, joined the company five years ago, bringing with her decades of experience at AT&T and an e-commerce company called E-Society, she found that some pieces of the traditional marketing toolkit she brought with her were out of place. "The biggest challenge for me was: How do I come into a place that doesn't do mass advertising ... and how do I throw out everything I've done and rethink the way that I communicate with people?" she said.
The answer, in part, came by encouraging feedback from employees at the store level and by letting people know she's always up for a good story. In October 2005 the company, which doesn't offer traditional discounts or coupons, was one year into a price increase and was trying to figure out how to continue to grow the business on top of that.
The solution appeared at a drive-through window in a California store, where the barista, having made a drink incorrectly, offered to remake it for free. The customer instead paid for the person behind him. The next customer did the same. This went on for nine customers. ("We always laugh about what happened with that ninth person," Ms. Saunders said.) What could have ended up as merely a good yarn became a marketing innovation: The marketing department created a coupon that told the story and asked recipients to hand the coupon to a friend or co-worker to invite them to have free cup of coffee.
This year Starbucks will spend just 1% of its sales on marketing. With a relatively tight budget, Ms. Saunders relies heavily on her own ingenuity as well as that of those around her.
"She provides her team autonomy in terms of being creative and will become your strongest advocate if she believes in what you're doing," said Suzanne DeChant, the company's marketing director for the Northeast. Traditionally a good portion of the marketing dollars have gone to grassroots efforts such as serving coffee at PTA meetings or sponsoring beach cleanups.
"These events communicate wonderfully about the brand and who we want to be, but they're very low-reach vehicles," Ms. Saunders said. As the company continues to expand the question becomes how to replicate marketing innovation on a rapidly expanding global scale with limited dollars. "Our challenge," Ms. Saunders said, "is: How do we change the wheels on the car as the car is racing around and around the track?"