Starbucks, and How a Small Coffee Shop in Seattle Stood Out And Now Sells 11 Million Daily Drinks Worldwide

I’ll have a grande chai latte to take away, cold but no ice, with oat milk and only two pumps of syrup, please. Oh, and a few extra paper straws. The name’s Bryan with a y. 

Please wait at the end of the bar to collect your drink when they call your name.

Now that you’ve placed your extremely long and somewhat complicated order and you’re waiting at the end of the bar, you can finally wonder why you are so addicted to those 5 dollar drinks—and where they come from. This is the story of how Starbucks stood out.

The first shop was opened in 1971 in the legendary Pike Place Market in Seattle, Washington State, by three academics: Jerry Baldwin, Gordon Bowker and Zev Siegl. However, it wasn’t until 10 years when Howard Schultz, born in Brooklyn and graduated from Northern Michigan University, entered the store. He immediately saw the brand’s potential, which was confirmed two years later when he became obsessed with the coffee culture following a trip to Milan. A new idea was born: opening espresso bars in America.

The timeline is as follows:

1971: first shop opens in Pike Place Market

1981: Schultz enters the Starbucks shop for the first time

1982: Schultz joins Starbucks with the position of Director of Marketing

1983: Schultz travels to Milan and comes back inspired by the coffee industry and culture

1985: after failing to convince the founders to adopt his new idea (selling the drink, not the beans), he starts his own company, Il Giornale

1987: he acquires Starbucks for 3.8 million dollars, merges it with his own company and becomes CEO.

1992: Starbucks goes public

2000: steps down as CEO

2008: comes back as CEO because of cultural decay within the company

2017: transitions to Executive Chairman

July 2019: Starbucks is worth 100 billion dollars for the first time

2022: comes back as CEO

As of August 2026, he remains as an important figure in Starbucks, but is no longer CEO, and focuses more on philanthropy.

Although some companies like McDonald’s with its McCafé line, Dunkin’ Coffee or Tim Hortons are considered competitors, it feels like they’re playing a different game. Starbucks generates 20 times the global revenue of Dunkin’, and it also controls about 31% of the coffee market in the US, while Dunkin' only controls 3%. Although McDonald's is the most valuable restaurant company globally, brand value at 42.6 billion, while Starbucks follows with 37 billion, the latter is much more influential in the coffee industry while the first focuses more on the burger sector.

Starbucks Rewards also plays an important role: boosting customer retention. It allows the company to study customer behaviors and tailor its service to their preferences. This is very cost-effective on the long term, as studies show it's more important to maintain existing customers than to attract new ones.

If you’ve read other articles on this blog, you’re probably familiar with the idea of scarcity and the role it plays when expanding a business. Howard Schultz noticed that no companies were actually selling coffee drinks, just the grains so people could make their own at home. When Starbucks took a risk and bet on shops making the coffee for you in that instant, like most great ideas, it was widely criticized. This relates to one very smart Peter Drucker quote: ‘the best way to predict the future is to create it’. For me, it reflects on how we’re the main characters of our own story, and we can use our power from that realization to influence other people’s stories. If they don’t like it, make them want to like it. That’s something only a small group of entrepreneurs understands and it gives them a great competitive advantage.

As Coffee Dasher says, 'consistency and convenience are what turn coffee into a habit, and a habit is what keeps people coming back'. That's something I'm 100% sure Starbucks has achieved.

Another policy that established a good reputation were the perks the baristas were offered. For instance, tuition coverage for college students and healthcare options.

Nevertheless, it's not always been rainbows for Starbucks, as they have experienced numerous boycotts due to national and international backlash throughout the years. One example is the 2012 boycott in the UK because of legal but controversial tax avoidance.

Some other relevant statistics that you may find interesting: according to PageFly, 71% of store app users visit a store at least once a week, 21% of customers return within three days and 10% return within a single day. 

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A New York Times article published the 23rd of October 1996 reflects one of many towns fear of Starbucks opening an establishment and how it would affect their daily life and local businesses. To describe Westchester Hamlet, said town, they said: ‘there are no golden arches, no Gap stores, no Blockbuster’s video emporiums’, reflecting just how dangerous and disruptive a coffee store chain would be in a town like that.

Another article published by the same newspaper just two years after reflected people’s difficulty—even today— to adapt to the new culture around coffee drinking that replaces the traditional model, where ‘it came to two flavors: regular and black’. She expressed how surprising it is that New Yorkers ‘on a restful Sunday morning, willingly leave their comfy couches, sheepskin slippers and terry robes, to lug the newspaper and go to sit on a narrow stool with their coats on’.

Nevertheless, Starbucks’ presence has not always caused controversy. In fact, another article published in September 2002 explained ‘we only wish to drown our sorrows in a strong cup of coffee in cushy chairs surrounded by strangers who will grant us the illusion of community yet respect our privacy’ and how that was exactly what the brand was achieving.

If you’re curious and want to learn more, I’d really recommend ‘Put Your Heart Into It’ by—you guessed it—Howard Schultz. Although a bit antiquated (it was written in 1997), it offers the unique, original story of the ready-to-drink beverage business only he is able to tell.

So what makes Starbucks different? You could spend your whole life trying to put it into words.

Bryan with a y? Here you go. Have a nice weekend!

That’s your order. Enjoy!