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Branding Lessons

July 16, 2008
The smell of Starbucks is still turning heads – maybe not with the aroma of sweet smelling coffee but with the smell of sweet success gone sour. Starbucks quickly became one of the most popular brands in the 21st Century with its trendy style and high end product. Millions of people were willing to drop $5 for a cup of coffee because of its brand.

So when Starbucks expanded extensively last year many coffee drinkers who drove out of their way before to get a cup of Starbucks (I was one of them), suddenly had access to Starbucks in Target stores, in cafes, and on almost as many street corners as Dunkin’ Donuts. It seemed like heaven.

But this week’s headlines announcing Starbucks decision to close 600 stores, sent chills throughout the country. The Syracuse Post Standard had an excellent article in Sunday’s paper about the fall of Starbucks from the branding standpoint.

There are lessons to be learned from the collapse of this giant for women like us hoping to grow and expand our own businesses some day.

Success Leads to Competition: Leading experts stated in the article “There’s nothing like success to bring on competition. Nobody says you can have the whole market forever.” With that in mind, women entrepreneurs must always strive to be the best, do their service better than everyone else, and make the best products, but be prepared to know that your competition is watching you and will certainly follow any successful steps you make.

Stay True to Your Core Quality: When Starbucks started moving too far away from their coffee brand by introducing movies, books, cds and clothing in their stores, they took too many steps away from the core quality of their brand, which was the coffee-house experience, which they imported from Europe and turned into an American experience. Women entrepreneurs can diversify but never to the extent that they lose their core quality of their own brand.

Don’t Walk Away from Your Brand if You are Making Money: One of the biggest reasons Starbucks has failed is because they walked away from a successful brand that was making them money. If a company is making good money, it shouldn’t drastically change its look, products or appeal to make more money, it should instead hone in on what it does well and continue. Women entrepreneurs should remember this very vital point when considering adding new services or products. Are you already making good money at what you are offering? If so, do more of the same thing. If not, add and diversify.

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