Starbucks Logo Change: Reflections on Coke and Gap (SBUX, KO, GPS)

Starbucks Corp. (NASDAQ: SBUX) has been known for changing and revolutionizing an industry.  The company changed everything about coffee, from price to the climate of drinking coffee to ultimately making coffee into a destination event rather than a beverage.  And now, it is again changing its logo as its brand is changing.

Starbucks now sells food, desserts, snacks, and it sells other beverages as well.  A select few locations may even become wine destinations.  Changing a brand can be tricky.  If not thought out properly, it can create a consumer revolt.  If it is a flop, let’s just say it makes for interesting marketing in the future.

Logo changes are not always brand changes.  They can be, but not exclusively.  The Coca-Cola Company (NYSE: KO) truly tried to change itself with New Coke in the mid-1980’s, a gamble which should have never been made.  The change could have cost the company a loyalty defection.  Coke responded by releasing Coke Classic, and it was such a successful return that maybe there was an inadvertent win from the company.  Most executives and executives to-be now learn the example as one not to generally repeat.

More recently came a failed logo change from the Gap Inc. (NYSE: GPS).  The apparel retailer landed in the soup because it made a very haphazard attempt of a logo change.  That effort backfired with sharp criticism and Gap immediately killed the effort.  The criticisms were by some counts maybe just malicious and unsubstantiated.  Still, the criticism was harsh enough and rapid enough that Gap decided maybe it better return to the devil it knows.

The market is currently positive for the day but Starbucks shares are down 0.3% at $32.38 in the final hour of trading.  The last year was good for the existing brand’s investors as the 52-week trading range is $21.26 to $33.42.  This might be a move that Starbucks should not do.  Or maybe.

JON C. OGG