Starbucks Introduction "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. Problem Statement The two questions that arose in Mr.Schultz's mind captures the problem faced by Starbucks. "Was Starbucks growing in the best way possible?" "Was Starbucks overextending in its quest for growth?" Options in front of Starbucks The dilemma of Howard Schultz right now is what next?. Where does starbucks go from here? The available options in front of them are the following 1. New Specialty Sales partners: The option currently in front of starbucks is to collaborate with McDonalds who has been approaching them for this joint venture. 2. Expansion of Domestic and International retail markets: With the target of 2000 stores by year 2000, Starbucks is on an expansion mode. They are expanding into the international markets and simultaneously they are diversifying in the domestic markets also. Initiatives like Frappuccino and the Doppio cart are part of this. 3. New Products: Right now, Starbucks is not targeting the younger generation well because the youth are not avid coffee drinkers. For this purpose they could launch a range of new products like flavoured coffee which the youth prefers. Analysis of Options While thinking in terms of collaborating with new speciality partners, we have to take care that the brand does not get diluted. Taking the case of McDonald's specifically, there are many factors that need to be considered. Looking at the pros of the proposal, we can see that you can potentially increase the customer base through this collaboration and the brand awareness may increase among the people that come to McDonalds . It might help us in targeting the youth segment that has been proving elusive in the other campaigns. But seeing the other side of the coin, there is a possibility of brand dilution when collaborating with McDonalds because there starbucks coffee might become a secondary product. The association of coffee with burger is not a popular one as burger with coke. So there the starbucks brand will not get the desired visibility. Another point being that the type of consumers who come to McDonalds is different from those who come to Starbucks coffee bars.
The organization can team with other organizations in order to create new products or grow revenues to the next level. Another option is to refocus on the home front and continue to growth domestically. With the competition that they currently face, Starbucks can push to gain bigger market segmentation. The company can also explore the expansion of their menu beyond just the “muffin mentality”. With that being said, they can also incorporate a full service breakfast & lunch and customers would be to get their coffee and a breakfast sandwich. Starbucks can focus on innovation by creating new items such as juice, gum, energy drinks, snacks,
The book revealed why Starbucks is one of the fastest-growing companies in recent years. Starbucks ' story is endlessly fascinating because of the unusual way the company has built a global chain and a global brand, explains Joseph Michelli, a Colorado Springs, Colorado, consultant and author of The Starbucks Experience: 5 Principles for Turning Ordinary Into Extraordinary. Moe, CEO of ThinkEquity Partners in San Francisco and author of Finding the Next Starbucks: How to Identify and Invest in the Hot Stocks of Tomorrow, says Starbucks ' early leaders were also distinguished by their exceptionally highflying entrepreneurial visions. "What Starbucks does magnificently well is treat employees not as pawns, but as partners," says John Moore, an Austin, Texas, marketing consultant, former Starbucks marketer and author of Tribal Knowledge: Business Wisdom Brewed From the Grounds of
Get ready, set, GROW!!! That really seemed to be Starbucks mission in life. From 1998 to 2002 they tripled the number of stores that they either operated or licensed. They wanted to penetrate every possible market and they seem to have been pretty successful at achieving this. Starbucks also had defined what they wanted to be when they grow up, in that they wanted to be the third place in a person’s life after their work and home. Starbucks created a unique gather spot for people and for its start targeted mostly affluent shoppers. Starbucks really felt that they were delivering the values of 1) Providing the highest quality coffee, 2) Creating a welcoming and customer focused experience, 3) Priding themselves in their unique ambient atmosphere. So Starbuck’s was not only trying to sell great coffee they were creating a unique experience in doing so.
Starbucks is one of the largest coffee franchises in the world. With over 26,000 stores in 64 countries, the company has the right to brag about this. One of the problems which Starbucks is currently being faced with is the brand being watered down by over expansion and a too diverse product mix. With McDonalds and Dunkin Donuts entering into the specialty coffee market, Starbucks needs to alter the path which it is going in order to remain competitive in this industry.
Starbucks portray a number of issues that may affect the company’s’ growth in the near future. To clearly understand these issues, they will be analysed in order to understand and create recommendations to assist in the growth of a successfully company.
...y preserving the integrity of the core business is a prerequisite for sustainable growth when expanding into other products, channels, brands and markets (Starbucks Financial Statements 2013, 5). The year 2013 has seen a combination of growth strategies - serving iconic beverages as well as new menu choices, expanding in existing markets as well as venturing new markets. In 2011, Starbucks unveiled a new logo which it says indicates its intention to move beyond its core product.
Starbucks is the world’s largest coffee roaster and retailer of specialty coffee in the world. We have enjoyed great dividend returns over the past 5 years, and our growth has been on the rise. We are currently saturating the US market, while the emerging markets of developing countries offer many possibilities for growth and increased revenues. In our US market we should look at offering more items on the menu that complement our long-standing tradition of pleasing our customers. Exotic Juices, and snacks served with the same service could add a nice margin to the bottom line. In addition, the ability to offer a drive through service for the consumer that loves fine coffee but does not have the time to stop and visit should be on our “trial” market plan for the next few years.
Serving as a social lubricant, Starbucks has offered people, exquisite, one of a kind coffee all over the world. Starting in Seattle, Washington back in 1971, it has expanded rapidly all over the world with more than 20,000 stores open today (Starbucks.com). The Starbucks locations offer hot and cold coffee beverages plus food items. While prices vary, Starbucks offers coffees anywhere from about $2 dollars to about $5. Their standard sizes are named in a different way, starting from a Tall, to a Grande, to a Venti and even a Trenti. Attracting customers by offering facilities like free Wi-Fi internet access, makes Starbucks a convenient social interaction restaurant. Some of the most compelling marketing strategies Starbucks offer to its customers is its warm atmosphere, environmentally friendly establishment, and good reputation.
Since its inception, the company has established itself as the premier purveyor of the world’s finest coffee. Safe for this, it has gained popularity for being the most aggressive retailer coffee house. The company has had such an impact to the world to develop a niche in the market that has seen the company transform coffee as a beverage to be viewed as a lifestyle accessory, more of a fashion icon (Starbucks.com). The main strategy of Starbucks has to develop the company and put up shops all over the globe offering fresh-brewed coffee. This they plan to achieve by maintaining the highest quality products whilst offering the same at a premium price.
There are many topics that arise throughout the case with Starbucks Corporation. Starbucks Coffee is located worldwide and there are many different ways to look at this situation. The company offers a unique range of coffee, lattes, espressos, and café style drinks. The company intended to reach a specific target audience, but has ended up in many different markets and has been growing rapidly. Starbucks has greatly used the “youth appeal” strategy to gain entrance into new markets. However, such enthusiasm cannot be counted on indefinitely; other strategies are always in the works. Over time Starbucks has been able to acquire a solid brand reputation and has a world renowned company logo.
Schultz has had a lot of success with Starbucks, not only in revenue but he has continued to expand the brands in their portfolio, increase store locations and reach all new highs. Starbucks is now an international company with more than 21,000 stores in over 65 countries (Starbucks Coffee International, n.d.). Starbucks believes their global success has a lot to do with their international partners. Schultz explained it nicely when he said, “We remain highly respectful of the culture and traditions of the countries in which we do business. We recognize that our success is not an entitlement, and we must continue to earn the trust and respect of customers every day” (Starbucks Coffee International, n.d.). Schultz continually sees opportunity and the ability for growth, with an increase in locations across the globe every year and the ability to keep up with the latest in technology (websites, online shopping, a Starbucks application with the ability to pay and reload loyalty cards on your smart phone), etc.
The improvements to coffee brewers and the innovation of Keurig has allowed for Starbucks to repackage their products and distribute it as a home product. Many of the flavors consumers could only get from the Starbucks espresso machine in the store can now be duplicated in the home. The opportunity for continued expansion is present. Coffee is quickly being consumed in almost every country in the world, Starbucks has a legitimate opportunity to influence those countries without the Starbucks brand to open their doors.
Starbucks has been invented a new way of getting people to buy their product. This was a question; “What does the customer
Advertisements are the key to gain business and promote a company’s product or services to its consumers. Starbucks is no exception. The coffee giant is “out there;” from television ads to it own line of entertainment.
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.