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The Pike Place Market: A Case Study Of Starbucks

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In 1971, the first Starbucks store opened in Seattle’s renowned Pike Place Market. In the beginning they made only one guarantee to their customers: Expect More Than Coffee (Starbucks, 2017). It is on that guarantee that they have built a connection with their customers that has solidified their success in a saturated market. Now they have more than 24,000 retail stores in 70 countries (Starbucks, 2017). Their extensive brand portfolio now includes the following: Starbucks Coffee, Seattle’s Best Coffee, Teavana, Tazo, Evolution Fresh, La Boulange, Ethos Water and Torrefazione Italia Coffee. In this report, I have made the choice to delimit this brand audit to only include the Starbucks flagship brand. The brand has positioned itself as a…show more content…
This category is defined by the trend of “purchasing coffee is based on its origin and artisan methods of production.(Fast Company, 2014)” Within the UK, the brand faces competition from Costa Coffee, Caffe Nero, McDonald's (McCafe Range), Pret a Manger, Greggs and not to mention independent hipster artisan coffee houses. In addition to this existing competition, the Canadian based coffee chain Tim Hortons are rumoured to be preparing to make an entry into the UK market. (Business Insider UK, 2017) Points-of Parity
Starbucks pride themselves on providing great-tasting coffee, reliability in service, speed and convenience. Whilst other competitors have entered the market and offered the same attributes, the brand has always capitalised on the ‘authenticity’ factor. However as the brand expands it becomes more commercialised, causing an erosion in its competitive advantage in this arena. This has left a gap for independent artisan coffee shops to offer a unique experience to rival the one Starbucks promises.
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Starbucks has made the decision to implement a category brand extension: Reserve and Roasteries which will have a more exclusive and upscale Starbucks experience. This extension will include 20-30 Roasteries targeted a tourist friendly locations serving slightly more expensive products. In addition, they will open 1,000 Reserve stores offering small-batch coffee and and food and Reserve Bars at 20% of all locations (Bloomberg Markets, 2016). There is one Starbucks Reserve located in Covent
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