Mr. Howard Schultz, inspired by the Italian coffee culture in one of his visits to Milan, decided to create coffeehouses, which he said, would become America's "third place" along with home and work. The initial stores started by selling coffee whole beans and premium priced coffee beverages by the cup catering primarily to affluent, well-educated, white-collar patrons (skewed female) between the ages of 25 and 44. The exponential increase in the number of stores along with its customer base since the early 1990s can be attributed to the following branding components: High Quality Coffee, Service or Customer Intimacy and Atmosphere: Starbucks wanted to establish themselves as the "most recognized and respected brand in the World ". Retail expansion and product innovation were fueling their ambitious goal. They were opening on an average three stores a day (see Exhibit 2) and were introducing at least one new hot beverage every holiday season. The increase in coffee consumption in the US after years of decline, the absence of Starbucks from eight states in US to date and the biggest growth in the market among drinkers of specialty coffee were strong reasons in support of the Management's aggressive growth strategy.

The Starbucks customer base in the meanwhile had expanded to a much younger, less educated and a lower income bracket people. The newer customers also visited the stores less frequently now and their perception of Starbucks as a brand scored lower on almost all parameters than its established customers (see Exhibit 8) . Market research also showed a sharp increase in percentage of customers who felt "Starbucks cares primarily on making money (up from 53% in 2001 to 63% in 2002)1" while the numbers of "Starbucks cares primarily on building new stores (up from 48% to 55%) 1 "
Lets Analyze: Reasons for customer dissatisfaction No clear deductions can be made on the particular reason/reasons for customer dissatisfaction from the data available. The probable reasons can be analyzed as