Starbucks is the world’s leading retailer of specialty coffee beverages and accompanying confectionery items. Starbucks was established in 1971 in Seattle by Jerry Baldwin, Zev Siegal and Gordon Bowker. Currently, Starbucks has over 21,000 stores and operates in more than 63 countries. The company’s mission is to provide an opportunity for people to enjoy a good cup of copy and engage in a good conversation. The following situational analysis provides a detailed look at the current business situation of Starbucks Corporation by providing an in-depth qualitative analysis of the company’s current product, market, opportunities, and challenges. Current products Starbucks offers specialty and high quality coffee at premium market prices. Starbucks’ …show more content…
Beverages include non-coffee blended drinks like Tazo tea, Viviano Smoothies and Ethos water. Starbucks coffee products come in different forms that include; fresh brewed coffee, hot and iced espresso beverages. Starbucks coffee comes in the form of dark roast, blonde roast, medium roast and flavored roast. The company’s confectionary portfolio consists of baked pastries, sandwiches, premium ice cream, oatmeal yoghurt, fruit cups and salads. Coffee making equipment include: coffee grinders, coffee brewers and espresso machines. The newest product portfolio of Starbucks includes music, books, packaged goods and gift items. The best performing product category is the beverage group while the single-serve category has recorded the highest growth in the past few years. The single-serve packaged category has helped to offset the decreasing coffee sales and rising costs of coffee beans experienced in the beverage industry in recent years. The recent trends in the coffee industry have made coffee making machines rather obsolete and …show more content…
Starbucks has an established brand and standard that allows its products to fetch premium market prices which customers are willing to pay. However, this has come at a price for the company. Starbucks has various competitors that include: McDonalds, Caribou Coffee, Dunkin Donuts, Costa, Coffee Nero, among other companies. There are also smaller countless coffee retailers that Starbucks competes with. Although these companies sell a similar product which is coffee, there is a lot of product differentiation. Each company is different in terms of what they offer their customers. Starbucks specializes in specialty coffee and sells its products at high market prices compared to other retailers in the market. The competition can be stiff and Starbucks has been a casualty to the existing industry rivalry. For instance, while Harrison & Hoole successfully entered the market with the support of Tesco, Starbucks exited the Australian market for failing to gain a considerable market share. Current
Over the past few decades, Starbucks has become a household name. Headquartered in Seattle, Washington, Starbucks is one of most lucrative coffee chains in the world. As of 2015, the company has chains in 50 countries with more than 22,500 stores in operation (Starbucks Corporation, 2017). The 70 stores located in Australia are focal point stores, which focus/tailor to improving the marketing strategy, customer service, and testing of new products to differentiate the company from the competition. Coffee is their primary business, so obtaining high-quality coffee beans from the nations that produce this product is important. Not only does the company sell hot coffee beverages, but they also offer a variety of cold drinks. The menu consists
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 Corporation is a Coffee company based on Washington. It buys, roasts, and sells whole bean through an international net of outlets.Starbucks, from its inception as a seller of premium and packaged coffees, is emerged in a firm known for its coffeehouses, people can buy beverages, food items and packaged whole bean and ground coffee.. The credit goes to Starbucks as it has succeeded in altering the way American and other people of the world-sees and consumes coffee, in this way it has attracted world attention.
In 2002, unexpected findings of a market research showed problems regarding customer satisfaction and brand meaning for Starbucks customers. The situation was unacceptable for a company whose overall objective is to build the most recognized and respected brand in the world. Starbucks was supposed to represent a new and different place where any man would relax and enjoy quality time, alone or with others. But the market research showed that in the mind of the consumers, Starbucks brand is viewed as corporative, trying to expand endlessly and looking to make lots of money. This huge gap between customers' perception and Starbucks' values and goals called for immediate action.
The key to its success lies not only in the quality of its products but also the ability to differentiate itself from the competition. With Starbucks, it has always been about quality. The company manages stringent quality control measures for sourcing the finest coffee beans, roasting processes as well as customer service and ancillary products. Furthermore, differentiation is key to market control and Starbucks is unquestioningly the most differentiated specialized coffee brands in the world. From the design of its coffee shops to the music played to the types of products offered, everything has a touch of uniqueness.
Starbucks Coffee, Tea, and Spice opened its first store in April 1971 in the Pike Place Market in Seattle, by owners who had a passion for dark-roasted coffee that was popular in Europe, but hard to find in the U.S. (Harrison et al., 2005; Venkatraman & Nelson, 2008). The company’s mission was to provide Seattle with the best access to dark-roasted coffee, and sought to educated customers about the product. As a matter of customer education and acceptance of the product, Starbucks grew and expanded into the successful domestic market it is today. Much of this success can be attributed to a focus on the total customer experience and s...
As mention earlier Starbucks has many opportunities of which it can take advantage. These include a joint venture with McDonald’s, where the restaurant giant would supply its customers with Starbucks coffee. Another is the bottled Frappuccino product that Pepsi and Starbucks have created. This has had a very positive response in the test markets and posses to be a lucrative option. Starbucks could also look at the vertical integration possibility of producing its own beans. This could prove to be very successful if they can capture a significant amount of the production they could become a price setter in the coffee commodities. Also because small coffee retail outlets are so trendy it is possible for them to set ...
As with any company considering new products in new markets, there are risks associated with it, and Starbucks would need to be prepared to respond accordingly. With diversification, Starbucks will have the opportunity to increase its growth. Also, this strategy will permit the company to add related or unrelated products to its existing business. This will be the opportunity the company needs in order to expand its products, by offering new products to its customers. If Starbucks is considering diversifying, it’s essential to adopt a strategy that is fitting for the company....
Starbucks Financial Analysis Company Overview Starbucks is the world’s largest specialty coffee retailer, with more than 16,000 retail outlets in more than 35 countries. Starbucks owns more than 8,500 of its outlets, while licensees and franchisees operate more than 6,500 units worldwide, primarily in shopping centers and airports. The outlets offer coffee drinks and food items such as pastries and confections, as well as roasted beans, coffee accessories, teas and a line of compact discs. The company also owns the Seattle's Best Coffee and Torrefazione Italia coffee brands. In addition, Starbucks markets its coffee through grocery stores and licenses its brand for other food and beverage products.
Starbucks is a worldwide company, known for is delicious brews of coffee and seasonal varieties of tasty drinks for any occasion. Starbucks opened with two main goals, sharing great coffee with friends and to help make the world a little better. It originated in the historic Pike Place Market of Seattle, Washington in 1971 by Jerry Baldwin, Zev Siegl and Gordon Bowker. The creation of Starbucks’ name came from the seafaring tradition of early coffee traders and the romance evoked from Moby Dick. At the time, this individual shop specialized in the towering quality of coffee over competitors and other brewing services enabling its growth to becoming the largest coffee chain in Washington with numerous locations. In the early 1980s, the current CEO Schultz saw an opportunity for growth in the niche market. After a trip to Italy he brought back the idea of a café style environment of leisure and social meetings to the United States we now see in Starbucks locations today. Schultz ultimately left Starbucks to open his own coffee shop, Il Giornale which turned out to be a tremendous success. Fast forward a year later, Schultz got wind that Starbucks was going to sell all their components of Starbucks including their stores and factories, he immediately acquired the funds to buy Starbucks and linked both operations. Within five years he was able to open more than 125 stores starting in New England, Boston, Chicago, and gradually entered California. He wanted Starbucks to be a franchise system based on the mission of telling the truth and emphasize the quality,
Bruss (2001) argues that the company hopes as well to make new investments in new coffee types. Starbucks has recently developed a new type of coffee called green-coffee. These strategies are created with the objective of support Starbucks’ commitment to buy coffee that has grown and processed by suppliers. They meet certain conditions of social, economic and quality standards. In addition to that, the company is paying additional premiums to those vendors who meet the specific requirements that the company wants.
As we know, Starbucks has made a name for itself making and selling coffee and specialty coffee drinks. It has made its biggest impression by becoming the espresso expert and public educator of how to make the perfect espresso; "Roasters" of the company are trained for one year.
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.
The strategic vision that Howard Schultz had for Starbucks was "Establish Starbucks as the premier purveyor of the finest coffee in the world while maintaining our uncompromising principles while we grow". This s...
When I saw this discussion, I couldn’t help but think of Starbucks and the impact they’ve made throughout their 45 years of establishment. I worked with them for about 7 years and saw how unique they were from your everyday coffee and latte spots. A retail company with thousands of coffee shops in the US as well as in other countries, this particular retailer has been able to catch the eyes of all ages as well as locations throughout the world. For example, today college students utilize Starbucks locations to study rather than go to a nearby library. Starbucks is also known for its best coffee and espresso drinks (Latte or Frappuccino) and with one of its delicious espresso 's any student or just a person stopping in to enjoy its lounge area where there is free Wi-Fi is awesome! Starbucks lifecycle has made a 360 turn around and been revamped twice to accommodated the growing market. Customizing their brand to fit more in with everything and not just one thing. By doing this they’ve created multiple product lifecycles within their own lifecycle as a corporate company.