Most Active Stories
News & Music Contributors
Stock price surges as Starbucks annual meeting presents another starstruck affair
Starbucks stocks have surged. That's thanks in part to the German financial company Deutsche Bank, which has resumed its coverage of the Seattle coffee giant and is saying investors should buy the stock.
It's just one sign of confidence in the rebound of the company, as its executives outlined its latest growth strategies.
An annual love affair with coffee and other addictive treats
Attending a Starbucks annual meeting is always a bit like going to a rock concert. The 20th annual shin-dig was no exception.
Fans of the company pack in to show their adoration for Starbucks executives. Slick videos and musical entertainment precede any official business. This year, with the 40-year anniversary of its founding coming up, CEO Howard Schultz put special emphasis on the history of the company.
"Now, I know there's some of you out there who are original investors," Schultz said, calling out specifically to his friend, Mercer Island-based, easy-listening saxophone player, Kenny G.
Schultz said Kenny G. has never sold a share, then joked that "he's been rewarded for that."
Then the CEO, who came back to the company three years ago to rescue it from a downward slide on the stock market, delivered words that most everyone in the audience - both at Seattle's Benaroya symphony hall and shareholders and employees watching via webcast all over the globe - likes to hear:
"If you invested $20,000 dollars in Starbucks in June of 1992, that investment is now worth over a million dollars."
Schultz says that value has been restored over the past three years with a turnaround strategy that the company calls its "Blueprint for Profitable Growth." It includes:
- a mobile phone app for payment to speed up coffee shop lines
- more Starbucks (and Seattle's Best Coffee) products in grocery stores
- more single serve and instant coffee options (Via, Keurig machines and pods)
- the tenacious pursuit of an emerging middle class of coffee consumers in China.
- A digital marketing strategy that gives coffee shop visitors free wi-fi with premium content: now not just Wall Street Journal stories, but also The Economist, ESPN Insider and Mediabistro with Marvel Digital Comics "coming soon."
Investors were also greeted with the chance to pre-order Schultz's latest memoire, "Onward: How Starbucks Fought for Its Life Without Losing Its Soul." At the meeting, you could pay $20 to get a $5 preloaded coffee card along with some advance galleys and a promise that an advance copy of the book would be shipped to you first. (I'll let you know when mine arrives...)
"Onward" is a sequal to "Pour Your Heart Into It" which tells the story of how the company was founded. Seattle Times business writer (and coffee town specialist) Melissa Allison has a review of the new book in today's paper.
Also noteworthy at the 2011 meeting: the traditional color guard that opens the meeting this year began with bearers of the flags from the leading trading partners of the US: Canada and Japan, to which Schultz told shareholders the company, its employees and its executives have already donated $2 million to help offset the costs of the earthquake and tsunami disaster.
The color guard ended with the flag of Ethiopia, which Schultz told the crowd he credits as the birthplace of brewed coffee.