Hello could you please summarize the brand dilemma's portion of this case ? saturation point. To restore the company's shine Mr. Schultz will need to make Starbucks specialagain.'In January 2008, Schultz returned as CEO. He argued that rising dairy prices, increasingcompetition and a faltering economy were not the company's main problems. The company hadspent the last several years 'trying to invest ahead of the growth curve -in people, process,infrastructure, roasting plants, coffee buying, and that had taken focus away from the customers'store experience'. He added 'This is a problem that I think we've created, and as a result of that,that we can fix.' He stated he would bring a 'laser- like' focus to improving the customerexperience and in making sure that the 'Starbucks experience' was markedly different fromrivals.He outlined a major restructuring initiative to slow the company's pace of US storeopenings. Initially, the company announced that it would be closing 100 under- performinglocations in the US. The number was upped to 600 stores in July 2008. Schultz believed that thecompany had not produced enough 'exciting' products, only variations of products and noblockbuster new products. Other initiatives would be to introduce new offerings for itscustomers. The company would try to boost sales at existing stores while opening fewerlocations. The focus would be on improving the 'customer experience' at US stores andstreamlining management.Industry analysts also had their take on what Starbucks should do. Dean Crutchfield, asenior vice president of marketing at Wolff Olins, a branding firm, said, 'Starbucks really needsto refocus on the luxury coffee experience; the smells, the sounds and they could mix up theretail presence to be less cookie-cutter, perhaps using a modular system of bars and furniture. Adifferent store design could give different locales their own sense of richness.'The solution, as Schultz put in his memo was, 'to get back to the core. Push for innovationand do the things necessary to once again differentiate Starbucks from all others.' Starbucks hadto rise to the challenge of staying small while growing big. Brand dilemmasWith the increase in focus on profitability, comfy couches were out and promotional musicstands and racks of coffee-related knick-knacks took their place. In the first sign of trouble, samestore sales declined in the US from 9 per cent in 2005 to 7 per cent in 2006. With the growth incoffee sales declining, Starbucks introduced warm breakfast sandwiches to boost sales. It wasserving breakfast sandwiches across 700 locations and they were expected to add $700 000 toeach store's annual sales. Since Starbucks' cafes were not equipped for in-store cooking, thesandwiches were cooked and assembled in a central location and shipped to individualdestinations daily. Here they were re-heated and served to customers. Soon however, there werecomplaints that the smell of baked sandwiches overpowered the aroma of coffee. Also, baristaswere instructed to ask customers whether they wanted sandwiches with their coffee, a techniquethat seemed unnatural to most as the idea at Starbucks was for baristas to remember the namesand preferences of customers.Starbucks was also seeing the entry of more players in the specialty coffee market. Themarket for specialty coffee in the US had grown from $11.05 billion in 2005 to $12.27 billion in2006. For customers, the coffee quality and a convenient location were the most importantcoffeehouses characteristics and price was the least. Coffee bars and espresso cans sprouted allacross the US. Espressos were also being sold at gas stations and convenience stores. There wereabout 25 000 coffeehouses in the US in 2007 as compared to 585 in 1987. A number ofindependent coffee roasters and cafes, targeting a particular area were thriving and re-focusingtheir attention on the art and craft of coffee selection, roasting, brewing and presentation. Thegrowing market attracted a number of fast-food retailers as well. McDonald's - the world's largestfast-food chain - and Dunkin' Donuts added specialty coffee to their offerings. McDonald'slaunched McCafe selling lattes and cappuccinos, with plans to serve coffee in its nearly 14000US restaurants in 2008. Dunkin' Donuts was also aggressively moving to grab the market ofaffluent women and professionals - two strong bases for Starbucks.Analysts believed that the company had grown far too fast. The Economist wrote, 'WhileStarbucks has expanded so have its rivals. The firm's home market seems to have reachedsaturation point. To restore the company's shine Mr. Schultz will need to make Starbucks special

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All companies want to grow and stay relevant in the market. Everyone wants to expand their business…