Starbucks brand takes dramatic hit after refugee announcement

Posted Feb 25, 2017 by Arthur Weinreb
The perception of the Starbucks brand dropped dramatically after the company announced it would hire thousands of refugees. While no direct evidence their hiring policy is a direct cause of the drop, it shows a boycott by conservatives may be working.
A Starbucks coffee sign.
A Starbucks coffee sign.
Shortly after President Trump signed an executive order banning travel from seven predominately Muslim countries, Howard Schultz, CEO of the coffee chain, announced the company would hire 10,000 refugees worldwide. Schultz said these new hires would be refugees who are fleeing war, discrimination and persecution in their homeland and who are in any of the 75 countries around the world where Starbucks operates.
SEE ALSO: Starbucks to hire 10,000 refugees after Trump ban
In announcing his plan, Schultz wrote to his employees stating he has heard their concerns and said civility and human rights that were taken for granted are under attack. Schultz further said the promise of the American Dream itself is under attack.
Starbucks brand perception has fallen by two thirds
YouGovBrandIndex measures the perception consumers have of thousands of brands in various sectors of the economy. The company interviews thousands of consumers daily (about 2.5 million a year} to determine how they perceive these various brands.
Consumers who are contacted are asked if they have heard anything about a particular brand during the past two weeks. This new information could come from word of mouth, advertising or the news. If the answer is "yes," people are asked if they view this new information as positive or negative. But they are not specifically asked what new information they received that affects their view of the brand.
YouGov’s analysis of Starbucks released shortly before Trump issued the travel ban indicated 30 percent of respondents said they would consider going to Starbucks the next time they wanted coffee. In a report released on Wednesday, that percentage dropped to 24 percent.
YouGov believes if the percentage of 24 percent remains, it will affect the coffee chain’s bottom line.
Calls for boycott of Starbucks
Almost immediately after Schultz’s announcement about hiring 10,000 refugees, a boycott began with the hashtag #BoycottStarbucks trending on social media. The main source of anger was the company was hiring refugees but not military veterans, especially homeless war vets.
Starbucks attempted to counter this boycott. CNBC reported in 2013, the company promised to hire 10,000 veterans and military spouses prior to 2018. By 2015, they had hired 5,500 vets and spouses.
The refugee announcement was not the first time Starbucks has angered conservatives. At a shareholders’ meeting, a shareholder questioned whether the company’s strong gay marriage stance was bad for the bottom line. Schultz replied, in effect, the company was doing very well and the shareholder was free to sell his Starbucks stocks and buy shares in another company. This answer was interpreted by many as Starbucks saying they did not want the business of those who do not believe in same sex marriage or conservatives in general.
Starbucks plans to hire these 10,000 refugees within a five year period.