The Rise and Success of Starbucks Millions of Americans these days depend on the glorious caffeine rich nectar provided to them daily by the local Starbucks chain store. With its humble roots firmly planted in Seattle, Washington, this little coffee shop has turned from a novel idea, into a veritable necessity for Americans on the go. The amazing success of Starbucks can be attributed, in part, to operational planning. Starbucks has become a well-known company for selling the highest quality coffee beans and best tasting coffee products. It was one of the first companies to realize that the real money to be made was in beverage retailing, not just coffee beans.
For instance, their instant coffee line VIA was a part of their differentiation and low cost leadership strategy. VIA is a low cost alternative to regular coffee and a... ... middle of paper ... ... market in US also can be a problem for the stores based in US. However this can be counterbalanced by adopting a diversification strategy and innovative product offerings to retain their customers in the US market. Opening stores in growing markets can give a big boost to Starbucks to regain its market leadership position. In spite of these challenges Starbucks still maintains a strong financial status which indicates that company still has many prospects for future growth especially with unexplored coffee markets in certain countries.
Although there are several specialized coffee players in the market today, one cannot overlook the magnitude of success and grandeur that Starbucks has achieved over the past many years. Its fast-growing coffee house along with tea and sandwich restaurant chain now makes it a dazzling investment idea. More than just coffee The company’s founder and CEO, Howard Schultz, has been successful in creating Starbucks into something that we didn’t really know we needed until we had it. He has meticulously crafted a brand for the company that adds a psychological value to its offerings. Thereby, when you buy a cup of coffee at Starbucks, you buy an experience.
By utilizing their strengths, and capitalizing on trends, as well as periodically evaluating weaknesses and threats, this little coffee joint has become America’s most enjoyable place to get coffee. Like many other organizations, executives at Starbucks realized the importance of planning. Planning involves making sound business decisions and goals for the company, specific divisions, a store, and for individuals (Bateman-Snell, 2004, p. 108). Starbucks’ executives have defined their business with the mission statement to “establish Starbucks as the premier purveyor of the finest coffee in the world while maintaining our uncompromising principles while we grow” (Starbucks mission statement). Executives have found various ways of increasing their market by examining alternative paths to conduct their business.
It is safe to say that Starbucks should continue to grow globally. Although it has been proven that they are already doing great globally with their 22,519 store open to date. It will still be good for the company to expand due to their successful growth. Starbucks strengths are good and already leveraged, however their weaknesses could become a risk in the future. Two of the risk that they should watch for is the high price of coffee beans in the market.
Starbucks Coffee is showing product leadership by introducing novel merchandise in its coffee shops and now retail stores around the globe. The Company has partnered with the PepsiCo brand for Frappuccino drinks and selling... ... middle of paper ... ...delivery will further build and keep consumer loyalty. In 2013, Geereddy stated Starbucks should build up these products along the same line of their core coffee products. In 2013, Geeredy also found coffee beans are a significant input into a Starbucks value chain and there have been wide fluctuations in the market prices of high quality coffee beans. Conclusion The approach that Starbucks is using has demonstrated constant and sturdier.
Starbucks primary business is that of selling high premium coffee. They have been able to cater a specific product to a specific demographic. Specialization allows for the Starbucks company to deliver great quality and continue to maintain their customer base. Although there is a great amount of coffee flavors the coffee bean is still the constant ingredient in the great tasting coffee. Involving technology with their market structure.
1.0 Analyze the role of marketing in hospitality or tourism organization; 1.1 Define the role of marketing within the hospitality or tourism organization Starbucks is the biggest competition for any new coffee house when they enter the market. They are also the biggest. They have hundreds of locations all over the world. There are some that have their own building and then there are those that are in airports, schools, malls, etc. The main objective for Starbucks is to be the most respected and recognized brand for coffee and specialty drinks.
Starbucks always trying to satisfy its customers through upholds diversity and promises the highest standards for its products. In between, it also serve the community and the environment. Also, Starbucks remain to be profitable although there is slightly slow growth .Starbucks is also being one of the fastest growing companies in the country. However, Starbucks’ coffees price which emphasize high quality coffee beans sells much expensive than other market competitor product. This situation indirectly way creates the opportunity for rivals.
Recommendation: Strategic Issue: Starbucks strategies have successfully made them one of the biggest names in the coffee market globally. Starbucks has been able to survive the high competitive market and to differentiate themselves from other coffee shops by producing high quality coffee. Also, Starbucks successfully create a huge numbers of loyal customers worldwide by providing great services and high quality products. Starbucks was able to survive 2008 financial crisis successfully. In 2008, Starbucks net income was -53% that means Starbucks was losing so much many yet, 2009 Starbucks was able to not only stop their losses but also to gain a profit of 24%.