Starbucks

It seems unbelievable to think that twenty years ago hardly anyone in America or Asia knew what a macchiato ( a coffee drink made from espresso coffee and some milk ) was. In India as recent as a decade ago coffee was synonymous to Nescafé nationwide and filter coffee dominating the south, available at a local chaiwallah at humble denomination of less than Rs 5 ( $ 0.09 ). In short, life before latté was simpler. Then the world got introduced to specialty coffees, all thanks to the global behemoth of caffeinated culture called Starbucks. Love it for its taste, deride it for its price or get mesmerized by its aroma, but you cannot ignore Starbucks. As far as coffee is concerned this is as branded as it gets. As it makes its inroads into India this year, lets explore what Starbucks is all about.

Inception
The first Starbucks outlet opened in Seattle, Washington on March 30, 1971 by three partners - Jerry Baldwin, Zev Siegl and Gordon Bowker. But the real man behind's Starbucks success is Howard Schultz. Schultz was running his own coffee shop called Il Giornale. In 1987 he acquired Starbucks and undertook massive expansion. Apart from the different tastes and degrees of coffee Starbucks is also crazed for its varied patisseries. 

How is Starbucks coffee different ?
Starbucks is ultra careful in procuring its coffee beans. Starbucks primarily uses Arabica coffee beans from sources all around the world ( mostly from highlands of Ethiopia and Java in Indonesia). Unlike other companies who purchase coffee from wholesale international markets abroad, Starbucks gets its coffee from individual farmers. Other than the beans, Starbucks coffee flavour comes from the long and careful roasting process which is done in a Starbucks outlet, a process that results in the thick coffee aroma in the outlet. However, a very important ingredient is, Happiness ( see next section ). 

To more about types of coffee beans, visit Sarah's Coffee Blog. 

Happiness at Starbucks

All employees at Starbucks are called partners. Starbucks has the policy of "we take care of our partners and they take care of our customers". The company has 149,000 full time employees. Starbucks gives health insurance and stock options to even the entry level employees  As a result it has one of the lowest attrition rates and frequently ranks among top 50 among Fortune's best places to work. In an extreme scenario, Sandie Anderson an employee at Starbucks in Tacoma, Washington developed such a good friendship with a very regular customer Annamarie Ausnes, that he donated her one of his kidneys when Ausnes' kidney's failed. 

Nomenclature de-mystified
The compnay was initially planned to be called Pequod after a whaling boat from Moby Dick. The name however did not go well with all of the co-founders. Instead it was named after the chief mate on the Pequod, Starbuck. The mermaid logo was inspired from the fact that the company was named after a nautical character. 

Starbucks outlet in Mumbai, India

Growth Unparalleled
Starbucks opens more than two thousand coffee houses per year. During a particular period in 1990s and the early noughties, Starbucks was opening a new store every working day. There are around 17,000 Starbucks outlets worldwide out of which around 10,700 are in the US. In US, Starbucks builds coffeehouses in such close proximity to each other that they can be as close as twelve feet apart. Starbucks situates stores near dry cleaners and video rental shops to give customers two opportunities to buy coffee: once when dropping something off, once when picking it up. More over, it is known to intimidate its competitors by opening as many as five new cafés per day in a single city. 

The cost of growth
The exponential growth of Starbucks has not come without its controversies. Starbucks outlet in Forbidden city in China was met by some stiff resistance by Chinese population saying that Starbucks “undermined Forbidden City’s solemnity". Starbucks clean image has always been under attack. As a measure to combat the same, Starbucks has a rumors section on its website. Caffeine, is a bug poison used by plants to disable nervous system of any insects who try to munch away its stems. Americans now drink so much coffee that caffeine has been detected in US lakes, rivers, bays and even treated drinking water. Based on all the above facts, opponents of coffee and caffeine in general have launched protests against harmful effects of coffee

Building the brand
When Starbucks made its entry into France in 2004, it was the time when US-French tension had peaked due to the Iraq war. Starbucks was presented as a liquid bridge between the two countries by Howard Schultz, by expressing the event as an opportunity to "share our interpretation of coffee". So strong is the power of Starbucks brand it is known to control direction of traffic in certain cities during the morning hours. Synonymous to the Big Mac Index, some analysts are discussing the possibility of a mermaid index, which will be developed on the basis of number of Starbucks a city has per 100,000 residents.  This index will be an indicator of the quality of life of a city. 

And maintaining this brand equity requires some serious work. Starbucks research and development tries to ascertain which colors will hot in the world of fashion next year, so that future Frapuccino flavours will match the outfits of trendy customers !

Nike

It does not care if one is an excellent footballer, a tireless athlete or nimble footed runner. But it gives us the energy, the drive, the passion and the inspiration to play that football game, do those extra push ups and run that extra mile. It gives us hope and confidence and joins us in celebrating our victory, because its Nike after all that pushes us to 'Just Do It'. Thus it holds a special place in all our hearts. For many of us the day when we got 'Nike-ed', was the day when we decided to go 'branded'. 

Today, Nike has occupied such an iconic status that all the successful sportsmen gladly endorse it and sports fans swear by its name. As a business case, it is the symbolizes the perfect offspring of globalization. 

First of all, why is it called 'Nike' ?
Nike ( pronounced Nai-kee and not Niek ) is named after the Greek goddess of the same name. Goddess Nike is the sister of Kratos and Athena and stands for strength, speed and victory. However, the company was not always called Nike. It got this name only in 1978.

So what was it called before ?
In 1964, Phil Knight (an entrepreneur) and Bill Bowerman ( an Olympic coach ) founded 'The Blue Ribbon Sports' company which was renamed Nike in 1978. 

How many stores does Nike have worldwide ?
Nike has more than 700 stores in more than 160 countries.  All the stores are corporate owned. 

But how ethical has Nike been in its global expansion ? Hasn't Nike been in the news for wrong reasons because of labor issues ?
Nike has been accused of running "sweatshops" ( working environment with dangerous or difficult working conditions ) in many Asian countries. In one particular case, Nike was accused of using child labor in producing its soccer balls in Pakistan. Nike usually subcontracts its work in different countries to a local firm. In response to the charges Nike has denied prior knowledge of child labor employment by these sub-contractors. However, many countries such as Vietnam, Indonesia and South Korea where Nike production units are located are known to operate sweatshops. 

Nike endorses several celebrities. How important is celebrity endorsement to Nike ?
Celebrity endorsements are critical to Nike's growth strategy. The two most notable celebrities endorsed by Nike are Micheal Jordan and Tiger Woods. One of the most significant endorsement deals made by Nike was with Michael Jordan. In 1984, Nike paid Jordan $ 2.5 million for a 5 year contract, which was the start of a lifelong win-win relationship. Jordan's branding proved to be quite fruitful for Nike as it allowed Nike to enter into basketball arena hitherto dominated by Adidas and Converse. Nike launched a range of shoes named Air Jordan which today generates more than $ 1 billion in revenue for Nike. In 2001 Nike used Tiger Woods to launch 'Nike Golf' range of golfing equipment and apparel for which Tiger Woods was paid ( hold your breath... ) $ 100 million for a five year contract. In the first year itself Nike golf garnered $ 600 million in sales and is one of the fastest growing brands. 

Nike has probably one of the most  identifiable brand logo. What does it represent ?
In 1964, Phil Knight during one of his visits to a Portland State University as a professor, asked a student named Carolyn Davidson to design some graphics for a presentation of Blue Ribbon Sports Company ( it was not called Nike as yet ). He wanted a logo that suggested motion or movement and among several logos that the Ms. Davidson presented, Knight chose the 'swoosh' symbol only in 'lack of a better option'. Ms. Davidson was remunerated $ 35 for the logo. Later, when the logo was adopted by the company, she was also given undisclosed amount of company stock. 

What is Nike Air ?
Nike Air is a shoe technology that offers shows with durable ad lightweight cushioning. In a Nike Air shoe pressurized gas is captured inside a tough yet flexible urethane bag. Compression reduces the force of impact and then recovery allows the air unit to return to its original shape and volume. Air technology addresses the specific needs of the sport, the athlete's size, the terrain, the distance covered, and the speed and direction of movement. The bag may be located at heel, forefoot or both the locations. 

Finally, how much does it cost Nike to make a shoe ?
According to multiple independent researchers, the cost to make a Nike shoe (including material, labor  rent, shipping, duties ) is around $ 20 a pair. Add to this R&D cost , sales and promotion cost, it comes down to $ 50 a pair. Nike shoes sell upward of $150 which adds up all the power and promise that the brand Nike holds for a customer !

BMW

The brand I discuss today oozes luxury but symbolizes value. It is the brand that has successfully carried out the feat of exporting brand equity and reputation out of its home country to every part of the world. And today its known for its quality, class and pursuit of excellence. It is the ride that captures everyone's fancy. No wonder, it holds a position among top most car brands in the world. 

What's in a name ?
Popular misconception : BMW stands for Best Motorcar in the World.
Fact : BMW stands for Bavarian Motor Works.

Hmmm.....'Bavaria'. Is that Italian ?
Bavaria is a state in Southwest Germany. The BMW headquarters are located in the city of Munich in Bavaria. 

Okay, so if its Germany, then BMW must have started before World War II.
BMW was started in 1917 by an Austrian Engineer Franz Josef Pop

Wasn't Ford started around the same time ? Have they been competing since then ?
Ford was launched in the US in 1903 and did not enter the European Market until 1967. More over BMW did not start its business by making cars. It started off as an aircraft engine production company and shifted to motorcycle production in 1923. BMW's first car was produced in 1927. 

Which was this car ?
It was called Dixi. It was a 754 cc car with a straight four engine. 2000 units were produced for this car. 

Which are some of the most notable BMW cars ?

Yesteryear
BMW 501 and successor 502 (1952 - 1964) were the first luxury cars produced after the World War II, when BMW had to start almost from scratch. The Car was called the "Baroque Angel" (in reference to curved flowing body style). 

Retro Era
BMW M1 (1978-1981) was a sports car produced in collaboration with Lamborghini. The car allowed BMW to enter in sports car race series. The result was a super car designed by, arguably, the best car designer in history. Only 400 streetcar units were produced for this design.

The future
BMW i3 is an ultra modern electric car under development by BMW. The car does not need and internal combustion engine and will be the first zero-emission vehicle produced.

What do the different number 'series' mean in BMW cars ?
Series are BMW's way to segment its market and provide each customer the car he wants to buy and can buy. There are three major series 3, 5 and 7 and each represent a different segment with 7 series being the top most segment. So 745i is a 7 series car with a 4.5 litre engine and i stands for fuel injection.

How much money does BMW make ?
BMW's annual revenue for 2011 was € 68.8 billion ( Rival Audi's revenue was € 44.096 billion and Honda € 7.85 billion ). To put this in broader perspective technology giant Google's 2011 revenue was € 29.77 billion). 

The revenues are collectively reported for cars, motorcycles and bicycles division ( yes BMW makes bicycles too  ! )

BMW has a beautiful logo, does it represent something?

The BMW logo resembles the Flag of Bavaria the state in which it is headquartered.  However, many people believe that the BMW logo represents a white propeller against a blue sky. The correct association is controversial. 

BMW has also been featured in several movies right ? Like the James Bond movie ?
BMW was featured in the 1993 James Bond flick Golden Eye. The launch campaign was carefully orchestrated with the movie and was responsible for generating the initial buzz. 
Some other notable films that feature BMW cars are The Transporter (in an action packed chase scene ), 2 fast 2 Furious, The Italian Job and Gone in Sixty Seconds. Also, BMW has also made its own series of  10 minute short films called The Hire, purely as a brand promotion exercise. 

In addition, there is also a fun side of BMW ( you thought only Google came up with innovative ideas ? ). 

So what is the secret behind BMW's success ?
BMW lays strong emphasis on design and quality. The designers consider their cars a piece of art. They believe that the cars have a soul and just like making a fine wine cannot be hurried, the perfect design takes the perfect time. More over the work force at BMW is so passionate about their work that they discuss projects even during lunch break. In addition to being a successful brand itself. BMW also owns the Rolls Royce Motor Company. Today BMW is a brand that represents pride for the owner and a dream for the aspirants. 

Join the Brandwagon !

  

 I don't look good in no Armani Suits

No Gucci shoes - or designer boots
I've tried the latest lines from A to Z
But there's just one thing that looks good on me

Bryan Adams might claim to fob off the most desirable brands to woo his woman in this 1996 smash hit, but it only re-enforces the power that brands hold in our lives. From the Reynolds you use to write that note, the Nescafé you sip in the morning, the Levis you wear, to the Honda you love to drive - your entire universe is encompassed by the powerful world of brands. 

A brand is not the product, but the promise that the product holds for its customers. Its the sum of the million experiences that the users of the brand share everyday. Brands are known to have a potent impact on the human mind. If brands shape your monthly budget plans, or brands amaze you with the power they hold, or even if you simply love to learn about brands - watch out for 'Brand Biographies' . 

Each week, a Brand Biography brings to you the story of a successful brand - Where did it begin ? How did it begin ? Who started it ? What is the secret of its success ? And much more...

After all, a product can be quickly outdated but a successful brand is timeless.