Fool.com: Starbucks: Wooing America [Special] May 12, 2004

David and Tom Gardner recently interviewedStarbucks(Nasdaq: SBUX)Chairman Howard Schultz onThe Motley Fool Radio Showon NPR. This is the third of five parts.

TMF: According to our Fool research, Howard, around half of Americans avoid coffee. What, if anything, can Starbucks do to appeal to those non-coffee drinkers?

Schultz: Well, it is interesting you should ask that because tomorrow we introduce nationally three new coffee drinks: strawberry and cream, vanilla, and a chocolate drink that is non-coffee related in time for the season. It is a Frappuccino-based cold drink. We are continuing to recognize that our customer base is using our stores very differently than in the years past. Five years our stores used to close at 6, 7 o'clock at night. Now the stores are open way into the evening hours, and we are doing as much business in the afternoon and evening as we did in the morning. People want non-coffee or decaffeinated beverages. Our audience also is skewing younger than ever before. We have to create beverages for younger children that does not have caffeine in it. Clearly, we are looking at ways in which we can create good-for-you products as well.

TMF: Howard Schultz, what is your Starbucks drink of choice?

Schultz: I drink a French-press black coffee in the morning at home, and then on my way to work I stop at a Starbucks store and have an Espresso Macchiato. 

TMF: How much coffee are you drinking in the course of a day? 

Schultz: Probably four cups a day.

TMF: Howard, Time magazine recently named you one of America's most influential people. We want to give you a chance to wield that influence with our audience. What is one thing our listeners can do to make the world a better place? And by the way, you are not allowed to use the word "Starbucks" in your answer.

Schultz: I think the recommendation I would have is that to balance our respective lives personally and professionally with as much benevolence to those people who are less fortunate as possible. There are so many people being left behind. Specifically, the interest I have is in people who are illiterate. There are 40 million people in America who are functionally illiterate. Most of them are a very young age and from underserved communities. Trying to help young people learn how to read and write is a great way to give back.

Tomorrow: The vision behind Starbucks, and Schultz comments on his best and worst business decisions during his tenure at the company.


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