Starbucks Founded in 1971, Starbucks originally sold its trademark dark-roasted coffee beans in a few Seattle stores, but everything changed when current chairman and CEO Howard Schultz took over in 1987. Schultz envisioned selling gourmet coffee beverages in hip neighborhood coffee bars like the ones he saw on every corner while vacationing in Italy. He wanted Starbucks to be a meeting place where people could exchange ideas and escape from everyday hassles. And from day one he wanted to go national. Schultz focused on building a competitive advantage through a loyal, well-trained labor force that delivers consistently superior products and service. He also fostered a company commitment to employer responsibility, environmental stewardship, passion for coffee, and integrity in customer relations. His efforts paid off. In decade, Starbucks grew to over 1,100 stores in 22 states and 3 foreign countries. Starbucks entered its twenty-sixth year as the uncontested leader of the gourmet coffee market. The company had already experienced incredible growth, with sales approaching $700 million in 1996, and Schultz had plans to continue expanding, opening almost 900 new stores over the next several years. The team began by extensively researching both competitors' and Starbucks' stores. They brought in hidden cameras to document how well the employees knew their coffee, and they asked customers how they felt about the products, atmosphere, service, and coffee. The insights they gained became the foundation of their strategy. Starbucks started making changes in products, distribution, and promotion. Over the years, Starbucks' core products, coffee beans and beverages, had already undergone changes to meet customer preferences, but some merchandise, such as mugs and coffee makers, had been left untouched. Now new merchandise was planned for all stores. In addition, new food items were offered to attract customers throughout the day. New products were targeted for grocery store distribution, including cold coffee drinks and ice cream novelties. Starbucks also began designing new stores to reflect local cultures. Even though product and distribution changes were important, a well-designed promotion strategy was the key to building a consistent image nationwide. Starbucks had always taken an undifferentiated approach to marketing. If a person was a coffee lover, that person was a potential Starbucks customer. And research shows that coffee lovers have an emotional tie to the beverage. It can even be a part of their self-identity. To capitalize on this, the marketing team focused on building a national campaign that didn't feel national. They wanted customers to build a personal identification with Starbucks products. So the advertisements they developed were down-to-earth and genuine, depicting Starbucks as a place to find peace in a hectic world. Finally, to ensure high standards of quality and maintain what Schultz believes is Starbucks' biggest point of differentiation the company reaffirmed its commitment to its employees. All Starbucks employees receive extensive training before they set foot behind a counter. They also receive progressive compensation, including full health benefits and stock options, even for part-time employees. As Schultz says, “The only way we're going to be successful i s if we have the people who are attracted to the company and who are willing to sustain the growth as owners.” Today, with more than 17,000 stores in 55 countries, Starbucks is the premier roaster and retailer of specialty coffee in the world. And with every cup, they strive to bring both their heritage and an exceptional experience to life.