Unless you’re an accountant or a C-suite chief charged with ensuring a healthy bottom-line, a company’s annual report — complete with rows and columns of near-indecipherable and yes, imposing, figures — is unlikely to inspire anything more than a cursory glance.
But when Mark Garwood, Starbucks’ new regional VP of operations sifted through the numbers, it wasn’t the actual P&L results that inspired him, but rather the company’s commitment to corporate social responsibility (CSR). So, ultimately, he decided he wanted to join up. “I was impressed because Starbucks had an annual report on its CSR programmes, setting down what it has achieved and targets that it wants to achieve in the future,” says Garwood.
Although CSR has played a supporting role in terms of its corporate objectives since the first stores launched in Seattle in the 1970s and ’80s, it’s a policy which is fast becoming a central plank of the company’s public persona. This is particularly in response to the company’s alleged exploitation of local coffee bean farmers globally, long a rallying point for anti-globalisation activists. In 2000, Starbucks introduced a line of Fair Trade coffee products, which now make up around four per cent of all Starbucks coffee sold, and the company is boosting its efforts to build hospitals, sanitation plants and water wells in under-developed communities across the region and indeed the globe.
Previously marketing and development director at Dairy Farm Hong Kong, Garwood admits that five or six years ago, notions of altruism were almost a foreign concept personally. In fact, he points out, it wasn’t until his most recent two-year project to launch Dairy Farm’s first organic food brand, ThreeSixty, in Hong Kong, that he realised a company could be good at business, while still giving back to the environment and community. And as an Australian sports fanatic, it seems his notion of fair play fits well with Starbucks’ burgeoning Fair Trade policies. “CSR is becoming increasingly important for all brands in all industries. People care more and more about the citizenship of a brand; not only consumers, but employees as well. Everyone wants to feel a little bit altruistic and happy.”
With Starbucks gearing up to implement an aggressive growth plan over the next 12 months and beyond — company chiefs have publicly expressed their desire to expand the Starbucks network from 1,650 stores to 10,000 regionally — the father of three admits he’s busy juggling the demands of work, family and furthering his education, with his MBA due for completion later this year. Tasked with rolling out thousands of stores, it’s clear he has his work cut out. With an affable grin, he reels off an old Australian saying: ‘Bite off more than you can chew, and chew like buggery.’ “That’s how I started my work life, although now I tend to work smarter. There’s still a little bit of that left in me,” he says. “You name it and I’ll have a go at it.”
Amid an increasingly bitter battle between coffee and tea brands for market share, the latter clearly dominating local palates and cultures in Asia, Garwood is eager to change perceptions, tastes and habits across the region. He believes it will be a mix of that marketing and operations expertise at the ground level which will present the winning formula for the coffee house chain. “A lot of the marketing effort at Starbucks is not really purely marketing,” he says. “There’s a lot less emphasis on above-the-line than compared with ensuring a clear and consistent message at store level. A key challenge will be maintaining the brand integrity and the consumer experience of Starbucks.”
Over the years, Starbucks has successfully moved to position itself as a ‘third’ place, sitting alongside office and home, and it’s a strategy he insists he’ll be building on in years to come. “The heavy tea-drinking cultures are a challenge, but it is a challenge that is overcome by the brand’s benefit. That ‘third’ place is a notion that transcends tea-drinking nations, just as it transcends coffee drinking nations, because Starbucks has created an aspirational value as the affordable luxury,” he says.
