An Analysis Of The Market Segmentation Of Starbucks

Starbucks is the world’s leading retailer, roaster and brand of specialty coffeehouse chain. It expands its operations with over twenty thousand locations in around 50 countries. It targets at boutique coffee market. Usually it operates in high-visibility areas, specially located in some business circles which have many visitor flowrates, or close to the area with many white-collar employees who have a high level of consumption (Kembell, 2002). It is also very welcomed by young people. As the video shows, the advertisement of Starbucks is full of creativity. It uses illustrations to introduce Starbucks coffee in a simple and lively way. Which can make customers or audience understand their products better and have curiosity to buy their coffee.

After reading this report maybe some readers would have a different and deeper understanding about Starbucks coffee.

Starbucks represents a model in coffee market. It has accurate targeting market segments. The next part will analyse some main characteristics of market segments targeted at by Starbucks. Market segmentation means classifying identified individuals or a group of people who have similar interest, feature and consumption habits (Jobber, 2013, p264). It is very important for a business to take market segments as a guidance to make its marketing strategies (Jobber, 2013, p265).

There are three different types of segmentations. Maybe the main characteristics of the market segments that are targeted at by the advertisement are focusing on consumers’ experience and showing how wonderful their products are. It instead of showing the price of the products, the place where Starbucks are located or the promotion they use. The reasons are as follows. In the first place, Starbucks pays attention to the benefits sought offer, which is the fundamental segmentation for different buyers who want to get different profits from a product (Jobber, 2013, p267). For example, it is beneficial for

The ad never mentions the price of the products, the place where Starbucks stores are usually located or the promotions to attract consumers. The existence of competition pushs marketers to make changes and be more creative (Jobber, 2013, p742). It is necessary for a business to survive with competitive advantage (Dibb& Simkin& Pride& Ferrell, 2012, p57). Michael Porter (quoted in Kotler& Wong& Saunders& Armstrong, 2005, p504) came up with three competitive strategies. Maybe Starbucks just applies two of the three strategies. One of the competitive strategies that Starbucks coffee applies is differentiation. Differentiation is the approach that the business uses to make its own products or services attractive, distinctive and different from its rivals (Dibb& Simkin& Pride& Ferrell, 2012, p57). Starbucks is a very creative company, because as the advertisement shows, an artisan roast is roasting coffee beans very carefully. The speaker says consumers’ favourite beverage signature espresso roast is developed uniquely by Starbucks. In fact Starbucks also creatively develops some other popular coffee like Frappuccino and Cappuccino. The other competitive strategy is focus. Focus means that a business targets at a certain group of market segments instead of facing the whole market (Kotler& Wong& Saunders& Armstrong, 2005,