News Outlets Fixate on Starbucks' No-Joe Play

Media Attention Over Coffee Chain's Three-Hour Closure Helped Publicize Howard Schultz's Turnaround Message

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NEW YORK ( -- Cost: an estimated $2 million to $4 million in lost coffee and muffin sales. ROI so far: hundreds of millions of dollars worth of media coverage for Howard Schultz's turnaround attempt; some better-trained baristas; and a rise in sales for Dunkin' Donuts.

We're talking, in case you were lost at sea for the past seven days, about Starbucks' three-hour closure of 7,100 stores last Tuesday night, an event that was part boot camp for baristas and part mass marketing for a company that wants to demonstrate that it's improving product and customer experience -- and by doing so drive sales growth and its stock price upward once more.

The cash-register and stock-price results remain to be seen, and certainly there was no significant SBUX uptick on the back of this stunt. But if getting the message across to tens of millions counts for anything, Starbucks, long a believer in PR rather than advertising, hit this one out of the park. Sure the coffee cognoscenti and regular readers of the business pages probably already knew that CEO Mr. Schultz aims to recapture the chain's soul, but after last week, the message will have spread far wider.

Starbucks' director-corporate communications Valerie O'Neil -- who refused to comment on the cost of closing Starbucks for three hours as estimated by Ad Age -- credited the idea itself to Mr. Schultz, the curriculum and training materials to its company's education and training department and the delivery of that information to its internal-communications team. She said the Starbucks PR team hatched a "narrowly-targeted" strategy, and then partnered with Edelman PR for "counsel on and execution of that strategy including local-market response."

Narrow-targeting or not, stories of the closure blanketed newspapers, local TV news and the internet, a takeover of newsmen's and professional entertainers' minds that evoked not-so distant memories of Apple's iPhone launch. Most of the coverage spent little time on the coffee chain's business woes and customer-service gaffes, and lots of time on highlighting the consumer obsession with coffee and depicting the shutdown of caffeine's biggest pusher as nothing less than a national nightmare. One Sacramento news broadcast posted on YouTube showed customers pounding on a Starbucks store and engaging in other acts of bewilderment.

Newspapers like The New York Times closely rendered the retraining in detail and pulled shot after shot from Starbucks' bottomless store of press release-ready bromides. Sample: "The machine is really a tool ... Ultimately, the barista is still the artist."

Then, of course, there was the reaction to the reaction, best captured by Comedy Central's evening lineup. "Daily Show" correspondent Jason Jones dashed around Times Square trying to get his fix. And Stephen Colbert celebrated the end of his drought by sensuously pouring a cup of coffee over himself and smearing his chest with foamed milk.

Bloggers respond
A blog post on's Adages prompted over 50 people to weigh in on the event. Most who touched on the awareness aspect were impressed. "It may have been some intense brand reinforcement to show consumers that 'Hey, it really does taste better on Wednesday a.m.!' or to make drinkers remember that absence makes the caffeine addiction grow stronger," said Chris Houchens, from Kentucky, who has his own blog, Shotgun Marketing.

Several of the country's biggest PR firms agreed: "Originally I thought it was a big deal when they said they were closing their doors for three hours, but when I saw what they got out of it, I thought that was really good spend," said Cathy Calhoun, president, Weber Shandwick, Chicago. "They didn't have to do anything ... they just did an internal training session and used it to make news. That's pretty smart."

Other marketing experts weren't so sure. John Moore, a former Starbucks marketer who now blogs at, was worried that the move signals to customers that they've been paying premium price for a less-than-premium product. Robert Passikoff, whose agency, Brand Keys, did a study that found Dunkin' Donuts had replaced Starbucks as the No. 1 brand in the coffee category, had a big tactical question mark too. "One of the big rules in the business is never drive customers into a competitor's arms, and that's what this did."

Certainly it did, at least temporarily, as everyone from one-store coffee houses through several of midsize chains such as Tully's, Peet's and Caribou Coffee and up to Dunkin' Donuts, jumped on this as a marketing opportunity, many giving away Joe. Dunkin' offered a range of drinks for 99ยข. "We're very pleased with the response to our national espresso offer," said Frances Allen, brand marketing officer for Dunkin' Donuts. "Our franchisees reported significantly increased store traffic and sales both during and after the promotion, while customers let us know how much they appreciated that Dunkin' Donuts stepped up to ensure that no coffee drinker was denied an espresso beverage that day."

'Back to basics'
And, as several of the Adages commenters pointed out, the biggest danger is that the training makes no difference in the long-term, making any short-term awareness boost pointless. "The media blitz here was intended to reinforce the company's renewed focus on the one word they own in the minds of just about everyone: coffee. So it was brilliant. Of course, it won't last. Howard will lose focus again and think Starbucks is a lifestyle brand ... or can mean something besides coffee ... or is an entertainment brand," said Brian Ribbey of Los Angeles. Rhiannon Hamilton of Cincinnati, who said she used to work for Starbucks, commented that training couldn't make any difference because the problem is the replacement of the old DIY espresso machines with the push-button machines.

Still, the baristas Ad Age sought out seemed trained -- particularly in media. When approached by a reporter announcing himself as such, they referred us to corporate headquarters. However, when approached by reporters posing as simply interested customers, the training got rave reviews from numerous baristas in different locations. "Oh yeah," said one barista emphatically. "It's working, it's working here." It was a great cure for the rapid staff turnover, said another: "There are a lot of new faces here, so it brought us back to basics."

And if it keeps them there, Howard Schultz will be able to say he's come a least a little distance in his journey back to the company's soul.

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Contributing: Emily York, Matthew Creamer, Michael Bush, William Hupp, Jonathan Lemonnier
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