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How did Starbucks’ non-brand decisions erode the brand’s positioning? How did this brand
erosion lead to customers losing interest in the brand?
This case offers a compelling example of how non-brand managerial decisions, such as store
locations, licensing arrangements and drive-through services can make sense on financial
criteria at one point in time, yet erode brand positioning and equity in the longer term
(Buchanan & Simmons, 2016). Additionally, this case demonstrates how brand value and
positioning can be influenced by seemingly unrelated, non-branding decisions. Starbucks tried
to focus on brand positioning by providing Wi-Fi service, creating and selling its music and
putting its focus on books and movies (Ferrell and Hartline, 2014, p. 524-525). None of these
things proved helpful in solving the company’s fundamental problems. That Starbucks’ new-
product initiatives, from food to music, books and movies influenced brand meaning is
obvious. The Starbucks story offers a differed appreciation of how brand value is built and
maintained. The company’s aggressive expansion through company-owned stores and
licensees added millions of new customers, but it also changed the nature of Starbucks’
customer base and eroded its positioning as a destination or Third Place (p. 527-528)
Starbucks is simply not what it used to be (Barnes, 2008). The brand that was one of the
pioneers of the notion of brand experience is struggling to be relevant in a turbulent
marketplace (Barnes, 2008). Starbuck’s original “third place” was centered around association
and sociability (Barnes, 2008). The atmosphere attracted customers’ desires such as chatting
with friends, reading magazines, and working on History assignments with laptops open
(Barnes, 2008). Sadly, Starbuck’s rapid expansion has moved the company away from this
brand positioning (Barnes, 2008).Without the convivial atmosphere of the original Starbucks,
it’s just not a third place anymore which has caused the company to lose some of its value for
millions of loyal customers (Barnes, 2008).