Starbucks Case Each company has what sets it apart from other companies in the same industry. This ideology excludes not Starbuck. Starbuck has a history and right from its inception, the founders wanted something that would offer fine coffee to the society that settled in Seattle. This has all along been the case. To accentuate this phenomenon, there was a time Howard Schultz had to travel to Italy to explore more of the Italian coffee tastes offered in Italy coffee bars and come back to customize the same in America. Unfortunately, upon his return he resigned from Starbuck and formed his own company. However, a few years after he formed his company, Starbuck went on sale and this led Howard Schultz and other investors to mobilize resources and purchased Starbuck. Schultz’s coming back to Starbuck has seen the company go through lots of ups and downs. The company got a rare opportunity of realizing the original ideal he envisioned of it when he returned from Milan (Webb & Schultz, 2011). The vision was to make Starbuck a place to be for all its clients and potential ones. Competitive Strategic Approaches used by Starbuck Companies put in place strategies that make them survive rough competitive business environments and this includes Starbuck. Competitive strategies are at least classified in five ways. First there is differentiation strategy that can either be focused or broad. Low cost strategies are also categorized as focused, general or best-cost provider. Starbucks’ original vision was to make the company part of the community (GAUDIO, 2003). Being a community’s meeting place, means that the company had to provide a variety of products that would accommodate every member of the society. In that regard, you find that ... ... middle of paper ... ...t think global is soon bound to be out of business. Secondly, Starbucks has specialty coffee that is not offered anywhere else. Thus Howard needs to concentrate on exploiting the growing demand for this kind of coffee both home and globally. Finally, as long as Starbucks will want to continue benefiting from the word of mouth marketing style, it needs to diversify its campaign strategies lest its competitors overcome it. References Seaford, B. C., Culp, R. C., & Brooks, B. W. (2012). Starbucks: Maintaining a clear position. Journal of the International Academy for Case Studies. The DreamCatchers Group, LLC. Webb, A., & Schultz, H. (2011). Starbucksʼ quest for healthy growth: An interview with Howard Schultz. McKinsey Quarterly, (2), 34-43. GAUDIO, R. P. (2003). Coffeetalk: Starbucks™ and the commercialization of casual conversation. Language in Society.
The book begins with a thorough description of Schultz’ upbringing, and he reveals that, “As the oldest of three children, I had to grow up quickly and started earning money at an early age” (P15). He also tells readers that his widowed mother encouraged him, “To challenge myself, to place myself in situations that weren’t comfortable, so that I could learn to overcome adversity” (P 16). Clearly, by the time Schultz had reached his teenage years he had experienced incredibly unfortunate circumstances, and yet had emerged as a hardworking and driven individual, determined to do bigger and better things. By 1982, Howard Schultz had quickly attained a respectable position at Hammarplast, a division of Perstorp; however he left and moved to Seattle quickly, because he “Saw Starbucks not for what it was, but for what it could be” (P 5). Schultz absolutely fell in love with Starbucks, and understood how incredibly marketable high-quality coffee could be; before other retailers and individuals caught on. His entrepreneurial spirit found a perfect application when he was introduced to Starbucks, and upon tasting the product and seeing the company in Seattle he told his wife, “I know where I want to live: Seattle Washington. It was my Mecca. I had arrived” (P 28). Schultz found what he had always
Great quality products, customized, served in clean, convenient placed stores for everyday coffee, friendly and fast serving, everything in a pleasant atmosphere - these were just few factors that lead to the great success of Starbucks during the nineties. Their USP was a place where every American could escape from home or work, for a coffee drinking ritual; high quality coffee, according to each customer's taste, served in a special, intimate ambience. Their image was supposed to appeal to anyone, being based on the idea of community, "exploiting" the need of people to interact with each other, in a "third place", away from home or work.
Founded in 1971 at Seattle’s Pike Place Market, Starbucks Coffee, Tea and Spices, as it was originally called, has been “brewing-up” its famous blends in over 43 countries, including the United States. Now called Starbucks Coffee Company, business isn’t just about the coffee and tea anymore. Starbucks has its own line of bottled water, handcrafted beverages, fresh food, entertainment, merchandise and a Starbucks Card. The company has received numerous awards for their outstanding business practices. Fortune Magazine has ranked them as one of “The Best 100 Companies to Work For” in 1998, 2000, 2002, and 2008 (Starbucks, 2008). The Starbucks Experience provides consumers and the general public a direct line a of business communication. From friendly baristas to press releases from CEO Howard Schultz, Starbucks keeps its “partners” informed.
The importance of economic indicators to the strategic planning process in any organization is the ability to benchmark economic conditions that contribute to improve profitability, business growth and market size. Leadership sets up the mission “to establish Starbucks as the most recognized and respected brand in the world.” In doing so, they have created a set of industry-leading, comprehensive coffee-buying guidelines addressing coffee quality, financial transparency, social and environmental responsibility. Starbucks strategy is also expanding market in globally to provide high quality coffee in convenient and visibility locations. They are continuing to innovate and extend the business with imaginative new ready-to-drink beverages and expanded packaged coffee offerings (Starbucks Corporation, 2007).
Starbucks not only shapes a defined importance on its product, the coffee, but also the relationships on its partners, its customers and its shareholders to create diversity, “to create a place where each of us can be ourselves” (Starbucks Coffee), to treat all related partners with dignity and respect at the greatest corporate level. In this sense, Starbucks involves its customers, its neighbors and is shareholders to participate in the community to “be a force for positive action—bringing together [its] partners, customers, and the community to contribute every day (Starbucks Coffee).
When people think of coffee, they think about Starbucks. The Starbucks Corporation has been around since 1971 when the first store opened in Seattle, and continues its phenomenon into the 2000’s with more than 15,000 locations world-wide. (Starbucks Corporation, 2009) In 2006, “Starbucks ranked fourth among the ‘World’s Most Influential Brands’ by Brandchannel.com” (Starbucks Coffee Company, 2008). The physical appearance of the Starbucks brand can be attributed to their siren logo which hangs outside their stores and is printed on all their carry-out cups, coffee mugs, bags of coffee beans, and other merchandise they sell. The siren logo has evolved over the years, and currently is depicted as a green circle with the words STARBUCKS COFFEE and a cropped image of the “more attractive stylized siren” (Deadprogrammer’s Café, 2005) than that depicted in the original Starbucks logo back in 1971. This logo is a major part of Starbuck’s advertising because they do not participate in conventional advertising techniques such as television and billboard ads. Starbucks Chairman Howard Schultz believes that experience actually beats advertising, and “the store experience has defined the brand” (Holmes, 2001). People go to Starbucks because they know they are going to get an exceptional cup of coffee or other beverage, high-quality customer service, and an inviting atmosphere.
Starbucks Coffee, Tea, and Spice opened its first store in April 1971 in the Pike Place Market in Seattle, by owners who had a passion for dark-roasted coffee that was popular in Europe, but hard to find in the U.S. (Harrison et al., 2005; Venkatraman & Nelson, 2008). The company’s mission was to provide Seattle with the best access to dark-roasted coffee, and sought to educated customers about the product. As a matter of customer education and acceptance of the product, Starbucks grew and expanded into the successful domestic market it is today. Much of this success can be attributed to a focus on the total customer experience and s...
The Starbucks corporate culture is not easily summed up because it is multidimensional. However, Starbucks leadership reiterates several key words regularly; “everything matters”, “playful”, “human connection”, “respect”, “dignity”, and “care”. In fact, many of these words can be found in their mission statement. Starbucks partner mission statement reads:
“Starbucks was named after Starbuck, first mate of the whaleship Pequod in Herman Melville’s Moby Dick…Starbuck was pluralized for ease of use” (Burks, 2009, p. 1). Now President, Chairman, and Chief Executive Officer, Howard Schultz formed Starbucks Corporation in 1987 after purchasing the name Starbucks, six stores and a roasting plant from previous owners, Jerry Baldwin and Gordon Bowker (Burks, 2009). Starbucks operates under a successful value chain management strategy. Their value chain encompasses a systematic approach to the way business is done. Robbins and Coulter (2012) point out, “A good value chain involves a sequence of participants working together as a team, each adding some component of value” (p. 520). Starbucks continually reviews every aspect of their business; from the organizational culture to values and ethics to strategy, planning and operations, management control and finally human resources and performance management, searching for those items that don’t contribute to the “Starbucks experience” which is what makes the Starbucks Corporation a successful business model.
As with any company considering new products in new markets, there are risks associated with it, and Starbucks would need to be prepared to respond accordingly. With diversification, Starbucks will have the opportunity to increase its growth. Also, this strategy will permit the company to add related or unrelated products to its existing business. This will be the opportunity the company needs in order to expand its products, by offering new products to its customers. If Starbucks is considering diversifying, it’s essential to adopt a strategy that is fitting for the company....
Starbucks case study: background 1971-87; private company 1987-92. (1997). McGraw-Hill Companies. Retrieved March 20, 2007, from the McGraw-Hill Companies website: http://www.mhhe.com/business/management/thompson/11e/case/starbucks-1.html
The current success and global industry leadership of Starbucks thus making it to the top most position of the market both locally here in New Zealand and internationally is a direct manifestation of its vision and mission statement. (Starbucks,
Starbucks is a worldwide company, known for is delicious brews of coffee and seasonal varieties of tasty drinks for any occasion. Starbucks opened with two main goals, sharing great coffee with friends and to help make the world a little better. It originated in the historic Pike Place Market of Seattle, Washington in 1971 by Jerry Baldwin, Zev Siegl and Gordon Bowker. The creation of Starbucks’ name came from the seafaring tradition of early coffee traders and the romance evoked from Moby Dick. At the time, this individual shop specialized in the towering quality of coffee over competitors and other brewing services enabling its growth to becoming the largest coffee chain in Washington with numerous locations. In the early 1980s, the current CEO Schultz saw an opportunity for growth in the niche market. After a trip to Italy he brought back the idea of a café style environment of leisure and social meetings to the United States we now see in Starbucks locations today. Schultz ultimately left Starbucks to open his own coffee shop, Il Giornale which turned out to be a tremendous success. Fast forward a year later, Schultz got wind that Starbucks was going to sell all their components of Starbucks including their stores and factories, he immediately acquired the funds to buy Starbucks and linked both operations. Within five years he was able to open more than 125 stores starting in New England, Boston, Chicago, and gradually entered California. He wanted Starbucks to be a franchise system based on the mission of telling the truth and emphasize the quality,
"Rewarding everyday moments". The Starbucks Mantra clearly implies that they are not selling just coffee. They claim to be selling the coffee experience. Their coffee bars that sell specialty coffee also gives customers an ambience where they can be themselves. Starbucks advertises themselves as the third place between home and office, where you can escape, reflect, read, chat or listen. They have become the largest player in the coffee industry and is still looking for avenues to expand themselves.
In addition to being best-known supplier of the finest coffee and promising only the highest quality products, Starbucks emphasizes firm values, provides guidelines to enhance employee self-esteem. This is to ensure continued customer satisfaction. Moreover, diversity has become a priority to providing an inviting environment to all consumers. Starbucks continues to abide by a strict, slow growth policy in which they set out to dominate a market before moving on to expand, thus history has shown this strategy to be successful for Starbucks, making them one the fastest growing companies nationwide.