Knowledge@ASB: What happened to Starbucks?

In the space of a month, coffee chain Starbucks went from ubiquity to near obscurity in Australia. Its decline meant significant losses for the company and put 700 staff out of work. Analysis of what went wrong, by Australian School of Business marketing professor Paul Patterson and colleagues, shows that the company with ambitions for global domination made fundamental mistakes such as trying to be all things to all people and charging a premium for a product that did not meet customer expectations. In the end it also failed to provide the customer service experience. Clearly many Australians decided Starbucks was not their cup of coffee, but businesses everywhere might thank the international brand for some salutary lessons to go.