DESIGN THINKING AT STARBUCKS

The Theory of Design Thinking

Before we delve into the practical applications of the Design Thinking and my experience applying it,
let’s take a deeper look at the Design Thinking process.

Design Thinking is a methodology that provides a solution-based approach to solve problems. It

focuses on understanding the user perspective, with a human-cantered point of view. The power of
this methodology is the possibility to test quickly if an idea, solution or enhancement can bring real
results to our customers. Integrating different methodologies, tools, and techniques coming from
different fields (marketing, psychology, design, business), the purpose of Design Thinking is to put
the user on the very centre of the problem we have to solve.

The goal of the methodology is to “find the user itself and define its needs” and by finding those
needs, create a solution or a product that can be really useful. To achieve this goal, the whole
concept is split into six design thinking phases.

What is DT

imagine that you have an idea. You come up with an ingenious application which you think will solve
your business problems. There are currently no identical solutions on the market and the one which
is most similar is not really working in the way that customers expect it to.

While your vision is still fresh, you start thinking about the first fundamental question that comes to
mind: “How long will it take to get it done?”

And since we rarely find ourselves with unlimited budget and time, the second consequent question
comes quickly: “How much will it cost me to do it?”

Both of these are fundamental and crucial questions in the making of a product, but often they are
precisely the wrong questions to start with.

Instead, the most important question to ask first is: “What value can I create for my users?”

To better understand the scope of a project, requirements, and timing we can use a methodology
called “Design Thinking,” which helps us during the “Discovery Phase” of a product. This is exactly
the time when we need to understand not only what will make a great product, but also how and if
we should do it. This creative and experimental approach helps us to better understand how to
create things that are not only usable but above all, useful.
The Design Thinking process is particularly useful because it generates a unique and specific
outcome: knowledge.

This methodology has a wider scope of use, but for the purpose of this Design Thinking Case Study,
we will focus only on one specific field - Starbucks design

Empathise

The first stage of the Design Thinking process is to gain an empathic understanding of the problem
you are trying to solve. This involves consulting experts to find out more about the area of concern
through observing, engaging and empathizing with people to understand their experiences and
motivations, as well as immersing yourself in the physical environment so you can gain a deeper
personal understanding of the issues involved. Empathy is crucial to a human-cantered design
process such as Design Thinking, and empathy allows design thinkers to set aside their own
assumptions about the world in order to gain insight into users and their needs.

Depending on time constraints, a substantial amount of information is gathered at this stage to use
during the next stage and to develop the best possible understanding of the users, their needs, and
the problems that underlie the development of that particular product.

Define

During the Define stage, you put together the information you have created and gathered during the
Empathise stage. This is where you will analyse your observations and synthesise them in order to
define the core problems that you and your team have identified up to this point. You should seek to
define the problem as a problem statement in a human-centred manner.

To illustrate, instead of defining the problem as your own wish or a need of the company such as,
“We need to increase our food-product market share among young teenage girls by 5%,” a much
better way to define the problem would be, “Teenage girls need to eat nutritious food in order to
thrive, be healthy and grow.”

The Define stage will help the designers in your team gather great ideas to establish features,
functions, and any other elements that will allow them to solve the problems or, at the very least,
allow users to resolve issues themselves with the minimum of difficulty. In the Define stage you will
start to progress to the third stage, Ideate, by asking questions which can help you look for ideas for
solutions by asking: “How might we… encourage teenage girls to perform an action that benefits
them and also involves your company’s food-product or service?”

ideate

During the third stage of the Design Thinking process, designers are ready to start generating ideas.
You’ve grown to understand your users and their needs in the Empathise stage, and you’ve analysed
and synthesised your observations in the Define stage, and ended up with a human-cantered
problem statement. With this solid background, you and your team members can start to "think
outside the box" to identify new solutions to the problem statement you’ve created, and you can
start to look for alternative ways of viewing the problem. There are hundreds of Ideation techniques
such as Brainstorm, Brain writes, Worst Possible Idea, and SCAMPER. Brainstorm and Worst Possible
Idea sessions are typically used to stimulate free thinking and to expand the problem space. It is
important to get as many ideas or problem solutions as possible at the beginning of the Ideation
phase. You should pick some other Ideation techniques by the end of the Ideation phase to help you
investigate and test your ideas so you can find the best way to either solve a problem or provide the
elements required to circumvent it.

The Define stage will help the designers in your team gather great ideas to establish features,
functions, and any other elements that will allow them to solve the problems or, at the very least,
allow users to resolve issues themselves with the minimum of difficulty. In the Define stage you will
start to progress to the third stage, Ideate, by asking questions which can help you look for ideas for
solutions by asking: “How might we… encourage teenage girls to perform an action that benefits
them and also involves your company’s food-product or service?”

prototype

The design team will now produce a number of inexpensive, scaled down versions of the product or
specific features found within the product, so they can investigate the problem solutions generated
in the previous stage. Prototypes may be shared and tested within the team itself, in other
departments, or on a small group of people outside the design team. This is an experimental phase,
and the aim is to identify the best possible solution for each of the problems identified during the
first three stages. The solutions are implemented within the prototypes, and, one by one, they are
investigated and either accepted, improved and re-examined, or rejected on the basis of the users’
experiences. By the end of this stage, the design team will have a better idea of…

Test

Designers or evaluators rigorously test the complete product using the best solutions identified
during the prototyping phase. This is the final stage of the 5 stage-model, but in an iterative process,
the results generated during the testing phase are often used to redefine one or more problems and
inform the understanding of the users, the conditions of use, how people think, behave, and feel,
and to empathise. Even during this phase, alterations and refinements are made in order to rule out
problem solutions and derive as deep an understanding of the product and its users as possible.

History of Starbucks

Starbucks was founded by Jerry Baldwin, Gordon Bowker, and Zev Siegl, opening its first store in
1971 near the historic Pike Place Market in Seattle. The three Starbucks founders had two things in
common: they were all coming from academia, and they all loved coffee and tea. They invested and
borrowed some money to open the first store in Seattle and named it “Starbucks” after the first
mate, Starbuck, in Herman Melville’s classic novel Moby Dick.

Alfred Peet, a coffee-roasting entrepreneur, was a major inspiration to the founders of Starbucks.

Peet was a Dutch immigrant who had begun importing fine arabica coffees into the United
States during the 1950s. In 1966 he opened a small store, Peet’s Coffee and Tea, in Berkeley,
California, that specialized in importing first-rate coffees and teas. Peet’s success encouraged the
Starbucks founders to base their business model on selling high-quality coffee beans and equipment,
and Peet’s became the initial supplier of green coffee beans to Starbucks. The partners then
purchased a used roaster from Holland, and Baldwin and Bowker experimented with Alfred Peet’s
roasting techniques to create their own blends and flavours.

Strategies
Starbucks. Founded in 1971 in the city of Seattle, USA, the brand has changed the way the world
drinks coffee outside home and work. Starbucks has been responsible for creating the concept of a
third place between home and work where people can relax, enjoy a cup of coffee and experience
the inviting ambience. It is often said that Starbucks taught America how to drink coffee and is now
continuously teaching the world.

The global expansion of Starbucks has been rapid and strategic. It opened its first international store
in Tokyo in 1996, entered UK in 1998 and opened its first Latin American store in Mexico City in
2002. The footprint of the brand increased to cover Russia in 2007 and it opened its first store in Ho
Chi Minh City, Vietnam in 2013. In February 2014, it entered Brunei, the 15th market in the Asia
Pacific Region and the 64th market globally for the company. In 2015, it opened stores in Panama
and reached the milestone of achieving 99% of ethically sourced coffee. The company has more than
30,000 stores in 80 countries worldwide as of June 2019, and is expected to maintain a strong
growth momentum.

On 3 April 2017, Starbucks’s former CEO Howard Schultz passed the leadership baton to Kevin
Johnson, who will be the president and CEO moving forward. Kevin Johnson served the company in
its board of directors since 2009 and has been the COO of Starbucks since 2015. Since Kevin Johnson
took over as CEO, the company has successfully executed on its strategic plans, including innovation
in coffee, elevated food options and innovation in premium craft iced teas.

Strategies

Branding has been one of the pivotal elements of Starbucks strategy over many years. The company
has invested significantly in creating a standardised look and feel of its stores, merchandise and food
and drinks. The Starbucks Siren logo is one of the most recognisable logos in the world. The global
expansion strategy has a key objective of recreating the Starbucks experience in every new country
the company enters. This essentially results in a similar kind of experience in its stores, whether it is
located in New York, New Mexico, Moscow, Tokyo or Shanghai.

The brand strategy, as mentioned before, focuses in detail on the experience the store creates. This
has always been the cornerstone of the company’s philosophy and values. In the United States,
where the company estimates that majority of its stores will become drive through, it has embraced
stunningly appealing design principles to create stores out of unused shipping containers. Interiors
of stores are continuously spruced up through clever and artistically appealing ways of using definite
materials, lighting arrangements etc. In its international stores, the strategy is around localising
some of the store elements but still staying true to the Starbucks experience.

The first strong indication that Starbucks is planning to move its focus beyond coffee and into other
beverages and food products was when the company logo was redesigned in 2011 to remove the
words “coffee” and “Starbucks”. This logo is in use till date and is one of the most visual and
recognisable elements of the company.

The company’s brand strategy has kept pace with time and has evolved to take advantage of new
and emerging customer engagement platforms. The company operates a website called
ideas.starbucks.com, where customers can leave ideas for the company to expand and improve its
products and customer experience, improve engagement with the community and enhance social
responsibility. This is akin to the emerging methodology of “crowd-sourcing” in the field of
innovation.
The brand has a sizable social media and digital presence, which has received renewed focus in
recent years. This has been driven by the need to better engage with customers and also be visible
on platforms where target or future customers spend time online. The brand has an active Facebook
page, a Twitter account, Instagram page, a Google+ community, a Pinterest page and a video
channel on YouTube. In 2015, Starbucks collaborated with Duracell Power mat to roll out wireless
charging in its UK stores, thereby adding to the customer experience and bringing digital innovation
into its stores.

The brand invests heavily and believes strongly in mobile marketing. It has embraced digital
innovation by developing and rolling out a Starbucks app for paying for products, tipping baristas,
earning and redeeming rewards. As at December 2019, it has 17 million Starbucks Rewards members
in US and 10 million members in China. In April 2019, it responded to customer feedback and
tweaked the Rewards program mechanics to enable occasional customers to redeem their stars
more quickly for beverages. Besides its success in using technologies like QR codes, coupon
downloads and virtual gift cards in its promotional campaigns, Starbucks has leveraged on Artificial
Intelligence to allow customers to place their orders via voice command or messaging interface
through the mobile app. This has resulted in a tangible increase in customer engagement, reflected
by a 20% increase in Starbucks Rewards member spend.

Conclusion

Here’s a summary of what we’ve seen with regards to design thinking principles. There’s a problem
with the product or service, you identify the problem by understanding the user, you ideate on
increasing user satisfaction, and you churn out solutions that you can test. There are two sides to the
process, One being ‘The user’ and another being ‘the team’ building the product or service. It is
important for the employees to think from the user’s point of view.

Here’s a summary of what we’ve seen with regards to design thinking principles. There’s a problem
with the product or service, you identify the problem by understanding the user, you ideate on
increasing user satisfaction, and you churn out solutions that you can test. There are two sides to the
process, One being ‘The user’ and another being ‘the team’ building the product or service. It is
important for the employees to think from the user’s point of view.