Talking Brand Strategy With Starbucks' Senior VP-Marketing

Q&A: Terry Davenport Discusses TV Ads, Latest Offerings and Retailer's 'Suggestion Box'

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CHICAGO (AdAge.com) -- Starbucks might have taken a hiatus from TV advertising, but it isn't ruling out a comeback to pitch its new health-and-wellness platform, Vivanno Nourishing Blends, said Senior VP-Marketing Terry Davenport. In Los Angeles, Starbucks is also unveiling Sorbetto, a proprietary blend of ice, fruit and, in some cases, Pinkberry-inspired frozen yogurt blend.
Terry Davenport
Terry Davenport

They are one of many initiatives launched since CEO Howard Schultz retook the reins in January, aiming for a turnaround that industry experts say will take time. A rewards program is now in place, new espresso and specialized coffee machines are on the way to stores, healthier food and beverage options have begun to arrive and the recently launched Pike Place Roast has boosted drip coffee sales systemwide.

The company has also made an effort to listen to consumers, at MyStarbucksIdea.com, which Mr. Davenport calls a "suggestion box." Some of the most popular requests have been for healthier food and lower prices. Starbucks responded to the latter last week with a host of regional promotions and discounts, once anathema to the brand.

Mr. Davenport, a former KFC marketer who joined Starbucks in 2006, was one of Howard Schultz' few quick-fire promotions upon returning to the company. Mr. Davenport now oversees the coffee giant's overall brand strategy. He talked to Ad Age about his upcoming plans.

Ad Age: With all of these new products coming out, should we expect another broadcast blitz?

Mr. Davenport: I don't know, I think it depends. ... When you're introducing new platforms, raising awareness, generating trial and getting repeat, it's more of a long-term investment. We're looking at go-to market mix, and we're open-minded about doing things differently.

Ad Age: Sorbetto is also launching this week, but only in Los Angeles. Why?

Mr. Davenport: It's a product that might skew more regional, and it's just a newer idea. Vivanno has been in the innovation stream almost a year now and the Sorbetto was an idea that really just got started in January and February and we've been fast-tracking it -- a lot of people in this building might say exceedingly fast -- to get it into the U.S. market this week.

Ad Age: Sorbetto is one of a handful of ideas that came from a trend-spotting trip to Italy last winter, right?

Mr. Davenport: Sorbetto we saw from a couple of different angles in Italy. As we brought it back, everybody got incredibly enthusiastic about it. It's different from anything else that's out there. The texture and flavor profile would have a unique and distinctive usage occasion for our customer. And in Italy, products like that have really become part of the coffeehouse culture.

Ad Age: There's been a lot of talk about your logo lately. A number of consumers were confused by the old brown logo's return, and a handful were offended. Was that a mistake?

Mr. Davenport: I would say that probably was the plan, to take something that might be a daily routine and suddenly it gets disrupted in some way. Some people liked it and some didn't like it, but the hope was that it would spark some conversation about the coffee.

Ad Age: But why do it with the cup?

Mr. Davenport: It's one of the best marketing tools we have because it not only walks around the streets but it's handed from our partners to our customers -- and the connection and opportunities to have that first impression is what the Starbucks experience is all about.

Ad Age: So what do you expect when the green logo returns in the coming weeks?

Mr. Davenport: I actually think we'll get another round of positive buzz when the green logo comes back.

Ad Age: How do you rate the success to date of MyStarbucksIdea.com? Are you really finding your core there?

Mr. Davenport: The internet still skews pretty young, especially with MyStarbucksIdea.com. We're getting the younger edge of our consumer base. There's a partner's version of mystarbucksidea.com, and about 80% of our baristsas are under the age of 25. When you look at ideas coming from partners and customers, there are a lot of parallels.

Ad Age: How do you track down the "old folks."

Mr. Davenport: There's another new tool we put in place about a year ago, the customer passion panel. That's [an online] panel that is actually recruits to be demographically representative. If we've got a particular idea and want to make sure it skews higher or lower, then we can go out and ask those question in a very specific way.

Ad Age: You introduced a series of promotions and discounts last week that run through summer. Isn't that going to devalue your brand?

Mr. Davenport: We're trying some things on value, but again it's more trying to demonstrate to our customers that we're listening to what's going on in their lives. With the price of gas and all of the other economic pressure, for us to just go radio silent on that whole part of their lives wouldn't be a good representation of the brand.
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