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Starbucks CEO: Embrace the human spirit

Starbucks chief executive Howard Schultz speaks in a keynote not of increasing revenues or boosting profits, but of embracing the human spirit.

Napa, Califonia--Starbucks chief executive Howard Schultz in a keynote yesterday spoke not of increasing revenues or boosting profits, but of embracing the human spirit.

"It's not about commerce," Schultz told analysts, investors, and business people during yesterday's Hambrecht & Quist Branded Consumer conference. "It's about ethics. It's about values."

Indeed, Schultz's Seattle-based coffee empire, which employs 26,000 people, has received praise for offering its part-time workers health care benefits and stock options. At the same time, Starbucks has been slammed for building a mass chain of stores that have been blamed for cannibalizing rivals' business and forcing mom and pop coffee shops and smaller chains to close their doors.

"I'm not trying to preach what we do as right or wrong," said Schultz, whose words invoked the feel of an old-fashioned revival. "We built the kind of company that has a set of values that I could be proud of."

While speaking his mind, Schultz spoke little of what many are waiting to hear about:Starbucks' Internet strategy. A portal plan, which should be announced within two weeks, is expected to add to the firm's current Web offerings, which include a corporate Web site where coffee is sold, and an online literary magazine called Joe, which debuted this week.

Schultz, who sits on the boards of eBay and drugstore.com, said companies need to do more with their Web sites than just go for the hard sell. He said they must use the medium to connect with consumers by backing humanitarian causes, doing good deeds, and supporting communities.

"As purveyors of products and services, we have to make the human connection," he said. "It has to be real and it has to be sustainable."

Schultz added that the Web has become a sort of corporate watchdog--enabling people to more easily access information about a company's business practices, not just its products and prices. Just as Nike was hurt by the perception that it was exploiting third-world workers in sweat shops, he said, other companies will suffer the same image problems if their manufacturing practices, employee benefits, and policies don't meet consumer expectations.