Starbucks is one of the most recognized brands in the world. Since 1971 Starbucks has become synonymous with coffee which they used to embody the brand and create a lifestyle behind it. Starbucks wants the world to know they have more to offer than coffee and are committed to meeting the needs of society. “We’re not just passionate purveyors of coffee, but everything else that goes along with a full and rewarding coffeehouse experience. It’s not unusual to see people coming to Starbucks to chat, meet up or even work” (Starbucks). In addition to coffee Starbucks locations keep a customer base by offering free Wi-Fi, music, and partnerships with Barnes and Nobles throughout the country. Starbucks is aware that competition is gaining ground since many fast-food chains have upgraded their coffee menus trying to mimic their style. Also coffee-houses/shops are opening who have adopted the idea of community and become just as popular and profitable. The company realized it reached a plateau and needed to develop new marketing and strategies to be competitive, retain, and gain customers. In order to remain competitive companies must stay innovative and reinvent their brand according to changes in society. A company that focuses on one advantage can limit their profit potential. Starbucks has recently decided to broaden its potential and enter the market by adding wine, beer, and small entrees to the evening menus at its independent locations. This move is one of its riskiest ventures to date, to make it possible Starbucks marketing executives want to use its most intangible asset “the brand”. The brand name may be intangible (literally, it cannot be touched), but it is a durable asset whose value increases as consumers associate it with... ... middle of paper ... ...rs on an international level is what Starbucks wants to maintain. The need to meet all their customer needs will give Starbucks staying power with any new venture. Works Cited (n.d.). Retrieved from http://www.starbucks.com/about-us/company-information Michaeals, R. (2011). Transactions and strategies economics for management. (1 ed.). Mason: Cengage Learning. Hororvitz, B. (2010, October 22). Starbucks remakes its future with an eye on beer and wine. USA TODAY. Retrieved from http://www.usatoday.com/money/industries/food/2010-10-18-starbucks18_CV_N.htm (n.d.). Retrieved from http://www.fda.gov/Food/GuidanceComplianceRegulatoryInformation (n.d.). Retrieved from http://.ehow.com/info_7793849_b2b-vertical-relationships.html Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2011). Strategic management concepts & cases. (9th ed., p. 14). Ohio: Cengage Learning
Microstars - this concept allows for growth in an untapped market. Microbrews are a solid bet for the future. With the quality control used by Starbucks in all their endeavors, I see them having the capability of hiring master brewers that would create a truly wonderful microbrew experience, in a global market using select Starbucks signature blends to diversify their market reach and the brand logo. If customer spending is down during morning periods while people are starting their work day, some of its revenue can be salvaged by catering to a market that spends their disposable income in the evening while winding down from a hard days
Because Starbucks set up a brand personality, the operation cares more about selling a kind of “coffee service” rather than partners cannot make delicious coffee.
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 improvements to coffee brewers and the innovation of Keurig has allowed for Starbucks to repackage their products and distribute it as a home product. Many of the flavors consumers could only get from the Starbucks espresso machine in the store can now be duplicated in the home. The opportunity for continued expansion is present. Coffee is quickly being consumed in almost every country in the world, Starbucks has a legitimate opportunity to influence those countries without the Starbucks brand to open their doors.
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.
Howard Shultz and the senior management at Starbucks have to decide how to react to the opportunities that are being made available because of their rapid growth. The decision for a strategic growth plan has to be made in the near future. This will prove to be key for Starbucks reaching their long-term goal of becoming the most recognized and respected brand of coffee in the world.
Starbucks did not escape the common practice of adapting and integrating the business to different geographic regions, but they did stick to their guns when it came to their standard product line-up and their no-smoking policy. Surprisingly, these conditions were met with wide acceptance. Analysts felt the real challenge would be in the European marketplace, what with coffeehouses on every corner to compete with. Again, the stores did very well, mainly because of the newer, cleaner environment they provided compared to the older locations of established houses.
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.
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.
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....
Schultz has had a lot of success with Starbucks, not only in revenue, but he has continued to expand the brands in their portfolio, increase store locations and reach new highs. Starbucks is now an international company with more than 21,000 stores in over 65 countries (Starbucks Coffee International, n.d.). Starbucks believes their global success has a lot to do with their international partners. Schultz explained it nicely when he said, “We remain highly respectful of the culture and traditions of the countries in which we do business. We recognize that our success is not an entitlement, and we must continue to earn the trust and respect of customers every day” (Starbucks Coffee International, n.d.).
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,
According to the Seattle Business Wire (as sited in Starbucks Coffee Company, 2015), the president and CEO of Starbucks, revealed to shareholders a vision for transforming the operation of his company in 2008 which involve the customer experience and reaffirm the company’s growth potential. He revealed that a five initiative strategy that he is directing the company towards will bring the company to a new level of quality (Starbucks Coffee Company, 2015).
One of the main problems that Starbucks is facing at the present time is the ability to maintain national competitive advantage (Monash South Africa, 2014). Due to their local demand conditions, Starbucks tries to satisfy all customers by trying “to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time” (Starbucks Corporation, 2014). Local demand conditons consist of a company trying satisfy needs of their closest customers and expanding their competitive advantage by upgrading their strategic management policies (Monash South Africa, 2014).
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.