PROBLEM STATEMENT
Starbucks has discovered that they are not always meeting their customers’ expectations in the area of customer satisfaction. Starbucks has to come up with an action plan to address this issue, considering its significant correlation and impact to sales and profitability.
SITUATION ANALYSIS
Company
Starbucks is acclaimed for its superior value proposition in the early 1990’s by creating an experience around the consumption of coffee, a ‘third place’. The brand is positioned to offer the highest quality coffee, close customer intimacy, and warm atmosphere or ambience.
Customers
However, data from the market research team has shown that there is a shift on Starbucks’ brand recognition in customers’ perception, as indicated by the increase in the number of respondents who strongly agreed with the following statements (data 2000 and 2001 respectively):
‘Starbucks cares primarily about making money’ --> up from 53% to 61%
‘Starbucks cares primarily about building more stores’ --> up from 48% to 55%
Exhibit 1, ‘The Top Five Attributes Consumers Associate with Starbucks Brand’, has further convinced the fact that being welcomed - only 39% respondents strongly agree - is the last attribute among the five.
While this market research data might partially be true, there is another justification confirming its validity. Although there are significant changes and expansions in customer base and demographic profiles, customers tend to use the stores the same way from 1990’s to 2000’s. Unfortunately, newer customers tend to have lower appreciation towards Starbucks’ brand (Exhibit 2).
These findings are quite daunting even though revenues from these years remain positive and increasing. Sooner or ...
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... for this training. It is also necessary to make sure it is not overdone and get to the point of being annoying instead of friendly and helpful.
Implement a reward system for employees based on customer satisfaction. It can be tied directly to bonus or an award like ‘Best Employee of the Month’.
Present an incentive programs through Starbucks’ SVC (stored-value card) such as free 1 cup after 10 purchases. The free cup can be limited in price, size, or even the products themselves. The SVC is proven to be successful in terms of reducing transaction times and doubling the number of visits to Starbucks. With the additional deal, it is no doubt that more customers will use this card.
As far as the contradiction data provided by company’s Customer Snapshot, it is compulsory to revisit the frequency, methods, attributes measured, and acceptance standard of this practice.
If you had the chance to enjoy the Starbucks experience, then you will appreciate their mission statement, which is , According to starbucks.com, it states, that it is “To inspire and nurture the human spirit – one person, one cup and one neighborhood at a time”.
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.
The Starbuck’s experience is a tactic that has hoped to assist in differentiating Starbuck’s from other competitors. As noted by Grant (2012) this experience “centered on the creating of a third place- somewhere other than home and work where people could engage socially while enjoying the shared experience of drinking good coffee”. Unfortunately without understanding the market within different cultures, Starbucks has lacked providing the experience that reflects upon the purchase styles of consumers.
People felt Starbucks was bitter and tasted burnt (The Seattle Times, February 2007). But still Starbucks sells more coffee than McDonald’s. Starbucks means best cup of coffee for many. Question here arises is, why is that so? If McDonald’s coffee tastes better why customers buy Starbucks coffee? The answer to this question is the message we got from the article. Starbucks is customer oriented. It provides personalized services buy writing you name on your cup of coffee. If you a regular customer and drinks same type of coffee, the staff at the outlet you most remembers it. They are friendly. They make you feel
Over the years that Starbucks had been out, they have not only made very odd choices to their strategies, but they’ve notoriously found a way to also work in the past. Starbucks has made a name for itself in today’s society along with its competitor’s right behind them. The company has differentiated itself from various competitors making it one step ahead of all other companies. Starbucks has been introducing new products into its menu and spreading many services to offers. Their innovation to grow and expand has certainly take a whole step and
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.
There have been some distinguished controllable and uncontrollable elements Starbucks has encountered when entering global markets. The strategies of any company’s goals are vital to its success. This is one area Starbucks has excelled in, just as McDonald’s has in recent years. Starbucks has paralleled its branding with the actions found at any Starbucks across the world. They have an excellent company vision, which they stick to, which in turn assists their brand image. Starbucks’ image has been achieved not only through this and their massive global entrance, but through their ability to provide honest quality service.
The purpose of this report is to give insight into the customer service practices of Starbucks. It is to compare practices in a local Winston-Salem
The Starbucks Corporation is built around an experience, the Starbucks experience. While the Starbucks experience is most notably associated with the way customers are treated, one could argue however, that the Starbucks experience transcends just the way customers are treated. The Starbucks experience is an all encompassing culture that revolves not just around customers but also to employees, or “partners” and suppliers. Burks (2009) notes that the company cares about the footprint it leaves, no matter where it does business; “the company is dedicated to making positive contributions to the communities where it doe...
Starbucks does its best to offer a unique and memorable experience for each and every customer. As part of their responsibility to their customers, they are committed to offering coffee of the utmost quality. Starbucks believes that employees are a major part in providing an excellent customer experience so they are able to maintain a long-term relationship with consumers.
Product: Unlike other coffee shops, or baristas, Starbucks has a reputation and image of culture
With clear core values towards providing quality coffee, the best service, and atmosphere, Starbucks has enjoyed great success since it was founded 30 years ago. The company has being doing very well for last 11 years with 5% or more store sales increase, even with the rest economy still reeling from the post-9/11 recession. However recent research, conducted to Starbucks, have showed some concerns regarding company’s problem meeting customers’ expectations.
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.
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.