Starbucks

In: Business and Management

Submitted By priyakaradgi
Words 998
Pages 4
[pic]

INDIAN INSTITUTE OF MANAGEMENT, INDORE

Marketing II

Case Analysis

Starbucks: Delivering customer service

Protagonist

The protagonist in this case is, Christine Day, Senior Vice President of administration in North America. Though Starbucks was growing year on year, but she was not feeling comfortable since the market research showed that Starbucks was falling short of meeting customer expectations.

Situational Analysis

Starbucks is at present the market leader in specialty coffee retail stores with a total of around 6000 stores, majority in the North America. It owned close to one third of America’s coffee bars. Still, Starbucks believed that there was a huge potential in the market in two ways. First, there was a big potential for building more traffic in the existing stores, as the number of coffee drinkers was on the rise. Secondly, Starbucks had a presence in only around 150 of 300 strategic locations, presenting a significant untapped market. The reason for Starbucks success had been the experience provided to a customer in their store, wherein customer service formed the backbone of their value proposition. Going ahead Starbucks wanted to grow aggressively following a two pronged strategy: retail expansion and product innovation. Despite recessionary environment Starbucks had grown steadily, but recently the marketing research report suggested that it was lacking customer service and there was a growing perception that Starbucks is more interested in only money making and expansion rather than focusing on customer service.

Competitive Landscape

The primary competition for Starbucks came from regional small scale specialty coffee chains. These chains tried to differentiate themselves from Starbucks by either offering a different ambience in their stores…...

Similar Documents

Starbucks

...Brief History: The first Starbucks location opened in 1971. The name is inspired by Moby Dick’s first mate. This name and the mermaid logo were inspired by the love of the sea, from Starbucks original lo-cation in Seattle Washington in the heart of Pike Place Market. Starting as a single shop special-izing in high quality coffee and brewing products the company grew to be the largest roaster in Washington with multiple locations until the early 80’s. In 1981, current CEO Howard Schultz, recognized a great opportunity and began working with the founder Jerry Baldwin. After a trip to Italy to find new products, Schultz realized an opportunity to bring the café community en-vironment he found in Italy to the United states and the Starbuck’s brand we know today began to take form. Selling espresso by the cup was the first test. Schultz left Baldwin to open his own Italian coffee house Il Giornale which found outrageous success and in 1987 when Starbucks decided to sell the original 6 locations, Schultz raised the money with investors and purchased the company and fused them with his Italian bistro locations. The company experienced rapid growth going public in 1992, and growing tenfold by 1997, with locations around the United States, Japan and Singapore. Starbucks also began expanding its brand. According to George Garza in his article The history of Starbucks the following product lines were added: * Offering Starbucks coffee on United Airlines flights. * Selling......

Words: 1800 - Pages: 8

Starbucks

...INTRODUCTION Starbucks Coffee Company, was once a small coffee shop opened by Gerald Baldwin, Gordon Bowker, and Ziev Siegl in 1971, has grown into the number one specialty coffee retailer. The company’s main objective is to establish Starbucks as the “most recognized and respected brand in the world,” At first, the store sold whole beans and premium-priced coffee beverages by the cup and catered primarily to affluent, well-educated, white-collar patrons (skewed female) between ages of 25 to 44. By year 2002, Starbucks is relying on product innovation, retail expansion, and service innovation to achieve a long-term goal set by Howard Schultz. By working toward this goal, Starbucks wants to open new stores in both new and existing markets, expand their product development process, and cater to customers’ needs to eventually improve their financial position and dominate market share. However, through customer feedback, Starbucks found that they have great pride in retail service but not meeting with customers’ expectation and satisfaction. Therefore, Starbucks plan to invest additional $40 million annually to add on labour hour in a week. But, can Starbucks really rely on the customer feedback for ‘excellent’ customer service? ISSUE AND PROBLEMS Based on the case, we can say that the main issue faced by STARBUCKS is about the declining in customer satisfaction. To stay on plan with their aggressive growth strategy, should $40 million be invested in the 4,500......

Words: 2326 - Pages: 10

Starbucks

...challenges facing Starbucks in 2010 Motives of Starbucks’ internationalization Exploring internationalization motives of Starbucks represented by a number of factors, including proactive and reactive factors, provides a better understanding of the reasons for the company’s decision to expand to foreign markets. Proactive motives are related to the firm’s motivation to take advantage of new market opportunities. While reactive motives represent that the firm responds to environmental changes and pressures in its domestic market or in foreign markets and adjusts the activities over time. (Hollensen 2011; Czinkota et al. 2009) Seeking growth and exploring new market opportunities are major proactive motives of Starbucks’ internationalization. Moreover, decision-makers are likely to explore first those overseas market opportunities perceived as having some similarity with the opportunities in their home market. At a later stage of internationalization Starbucks strived to make use of economies of scale which enabled the company to rise more rapidly on the learning curve and reduce production costs. (ibid) Major reactive motive for initial stage of Starbucks’ internationalization is represented by physical and psychological closeness to Canada that was the first foreign market for the company. Another reactive motive of Starbucks’ international expansion is saturation of the domestic market. The case study mentions that Starbucks expanded to......

Words: 7138 - Pages: 29

Starbucks

...Starbucks has been opening its doors to millions of people for coffee, but it is more than the overpriced coffee that brings people in day after day. Starbucks offers a unique ambiance, friendly and helpful baristas to assist customers in any concerns they might have with the coffee or service. People buy Starbucks for what it represents and the status symbol that comes along with it. What makes Starbucks unique from its competitors and how does its marketing strategy tick? Background It all started when Gerald Baldwin, Gordon Bowker, and Ziev Siegl opened its first Seattle coffee shop in 1971. Since then, Starbucks Coffee Company established itself as the leader in the coffee industry with continuous market growth and expansion.  With 17, 003 stores in 58 countries, the company’s main objective is to establish Starbucks as the “most recognized and respected brand in the world.” (Starbucks, 2011) Currently, Starbucks is relying on retail expansion, product innovation, and service innovation to achieve a long-term goal once set by current chairman Howard Schultz: “The idea was to create a chain of coffeehouses that would become America’s “third place.” At the time, most Americans had two places in their lives – home and work. But I believed that people needed another place, a place where they could go to relax and enjoy others, or just be by themselves. I envisioned a place that would be separate from home or work, a place that......

Words: 3733 - Pages: 15

Starbucks

...the world walk into Starbucks every day for their cup of coffee, but it is more than the overpriced coffee that brings people in day after day to the Starbucks stores across the world. Starbucks offers an upbeat environment and friendly and helpful staff to assist customers in any question or problem they might have with the coffee or service. People buy Starbucks for what it represents and the status symbol that comes along with it. Starbucks is currently one of the top contenders in the coffee industry. It is aware of the stiff competition and is prepared to combat it however possible. In order to better determine Starbucks’ situation in the specialty coffee industry, it is important to look qualitatively and quantitatively at its current strategy. An analysis of the company’s strengths, weaknesses, opportunities, and threats, SWOT analysis, and a strategic issues analysis will breakdown its strategy and provide positive and negative feedback on the company as a whole. Starbucks’ Situational Analysis: Starbucks has done many things to help its company grow and expand into the transnational business that it is today. Its high quality differentiation strategy allows it to focus on pleasing the customer in every way possible. Its introduction of wireless internet and the Starbucks Digital Network allows it to provide a better experience for its customers and increase its sales compared to the company’s previous performance. If people stay at Starbucks for longer......

Words: 1154 - Pages: 5

Starbucks

...description of the Starbucks Coffee Corporation. This paper will also discuss the six components of Starbucks organization’s supply chain. This paper will also discuss the potential problems with the supply chains and what could be used to prevent the problems. This paper will show control chart with the global operational processes. Lastly, this paper will address the importance of quality management and measurement. Starbucks Coffee Corporation Starbucks Corporation is one of the best examples of a global organization that deliver services and goods all around the world. Starbucks Coffee began in 1971 in Seattle’s Pike Place Market. Starbucks is the largest coffee company and coffeehouse global. Starbucks name derived from character in the Moby Dick book the first mate and the logo is Greek mythology twin-tailed siren. With more than “23,187 Starbuck stores in 64 countries, including 12,973 in the United States, 1,897 in China, 1,088 in Japan and 927 in the United Kingdom” (Starbucks Company Statistic, 2014). By “one person, one cup and one neighborhood,” Starbuck mission is “to inspire and nurture the human spirit” (Starbucks Company Profile, 2014). I am not a coffee drinker but ever since Starbucks been around I am drinking coffee. I never knew about Frappuccino’s, Lattes or Expresso’s. My favorite drink is Sugar Free Caramel Macchiato with couple splashes of French Vanilla syrup coffee or the Vanilla Bean Frappuccino. Let’s not forget about Starbucks other......

Words: 950 - Pages: 4

Starbucks

...Starbucks Corporation: An Extensive Analysis By: Muhammad Almuhanna Andre Johnson-Payne Jessica Pope Natalie Schiefer Jordan Sprague Management 429 – Dr. Yu Liu April 16, 2012 Table of Contents Brief Introduction & Key Issues 3-4 External Analysis 4-5 Internal Analysis 5-7 Analysis of Business Level Strategy 7-8 Analysis of Corporate Level Strategy 9-11 Recommendations 11 References 12 Appendix 13 Brief Introduction & Key Issues Starbucks opened their first location in Seattle, Washington in 1971. Since then, the company’s main focus has been to ethically source and roast the highest quality Arabica coffee beans in the world. The company’s mission is “to inspire and nurture the human spirit, one person, one cup and one neighborhood at a time.” They achieve this by having more than 17,000 locations around the globe and being the world’s largest premium specialty coffee retailer (Starbucks Corporation, 2012). Starbucks was founded by three acquaintances: an English teacher, a history teacher, and a writer. The three were inspired by entrepreneur Alfred Peet, Dutch American entrepreneur and the founder of Peet's Coffee and Tea in Berkeley, California. The name Starbucks is taken from Moby Dick, after the name Pequod was rejected by one of the cofounders. Therefore, the company was named after the chief mate on the Pequod, Starbuck. Their logo is inspired by the sea featuring a twin tailed siren from Greek myths (Starbucks......

Words: 5844 - Pages: 24

Starbucks

...STARBUCKS Student ID: 17834560 Subject: 2014-BUS5MMS(BU-2) - MGT AND MKT FOR SVC Submitted to: Dr. Navin Veerapa Submitted by: Ibrahim Gurgaij Date: 11, Sep 2014 Table of Contents ABSTRACT:- 4 I- INTRODUCTION OF THE COMPANY:- 4 Financial performance 5 II-MISSION STATEMENTS:- 5 III-SWOT ANALYSIS:- 6 INTERNAL ANALYSIS:- 7 Strengths 7 Experience:- 8 Brand name:- 8 Weakness 8 Dependency:- 8 Power of Substitutes 9 EXTERNAL ANASLYSIS 9 Opportunities 9 Brand Power:- 10 Customers 10 Threats 11 Rise in competition:- 11 Supplier situation 11 Ownership:- 11 IV-Competence based Strategy:- 12 V-CONCLUSION:- 13 STRATEGIC MANAGEMENT FACTORS:- 14 Marketing Mix is shown by this diagram:- 15 Product 15 Price 15 Place 16 Promotion 16 REFERENCES:- 18 ABSTRACT:- Starbucks cannot be termed as an ordinary coffee shop it represents a different culture and atmosphere beyond a cup of coffee. Starbucks is such a famous brand that it can be found in cities like Indonesia, Bali also. According to their CEO Howard Schultz their culture denotes the values of their company and share purpose like self esteem and self respect etc. For star bucks It is important to maintain their culture and also achieve their desirable levels of development and growth side by side. Their CEO tries to maintain the traditional way of making coffee mixed with new technology so that customers can...

Words: 3582 - Pages: 15

Starbucks

...Executive Summary Starbucks is an international coffee corporation which is a special corporation. In the past 40 years, Starbucks gain a huge success. However, in the process of gainning success, Starbucks also faced a lots of challenges. So what the difficulties it suffered and how it solved the problems are very improtant to our corporation’s success. Introduction Starbucks is an international coffee corporation. When Howard Schultz, the chairman & CEO of Starbucks, attended the Commonwealth Club, he said that “ Starbucks is a special company, not a company better than other companies, but a company different from other companies.” Starbucks creates a third place between working place and home which can provide the sense of community and human connection in every Starbucks store. At the same time, Starbucks provides high quality coffee at high price, so the market target of Starbucks should be the middle-class. Background According to the Starbucks Offical Website we can know that the first Starbucks store was opened in Seattle at 1971s. At that time, Starbucks just sold coffee beacons and coffee equipment for people and only has four stores. In 1987s, Starbucks creates its coffee culture. In 1990s, Starbucks expanded beyond seattle and first to the rest of the America. In 1992s, the stock of Starbucks was traded on the NASDAQ National Market. In 2000s, Starbucks has 6,000 stores over 30 countires. In 2010s, Starbucks has 17,000......

Words: 787 - Pages: 4

Starbucks

...CASE QUESTIONS: STARBUCKS 1. What factors accounted for Starbucks’ extraordinary success in the early 1990s? First, Starbucks offered the premium-quality product. Its coffee beans were sourced from the Africa, Central and South America, and Asia-Pacific regions. Starbucks purchased green coffee beans directly from growers and controlled the custom-roasting process, and distribution to retail stores around the world. Most coffee beverages were handcrafted following the number of specific steps. Second, Starbucks offered uplifting customer service to customers. Store employees (partners) recognized regular customers and provided personalized service. Partners were trained to listen to customers, identify their real need, and offer solutions to customers with the Starbucks’ “Just Say Yes” policy. Third, Starbucks offered an upscale, pseudo-European, yet inviting atmosphere. Stores had seating areas, inspired from Italians’ espresso bars, so customers could come to relax and hang out (social experience). The major customers were affluent, well-educated, white-collar female between the ages of 25 and 44. The company-operated stores were located in high-traffic, high-visibility settings such as retail centers, office buildings, and university campuses, which provided customers with easy access to the stores on a daily basis. Lastly, Starbucks had capital to expand its business across the nation. In 1992, Starbucks went public and raised $25......

Words: 1331 - Pages: 6

Starbuck

...biggest coffee system in the world with named “Starbucks – a character in Moby-Dick novel” and take siren become their logo. In 2014, Starbucks has more than 20,000 stores on over the world and return 8.8 mil of USD in 2013. To reach this success, Howard Schultz had to go through a restless labor and he turned coffee into passion instead of simple drink. This make Starbucks become a number 1 brand. II. The story about a giant in coffee industry - Starbucks Source: Design Observer 3.1 Understanding a process – Create more profit Customers think it simple but Starbucks knew it’s the art of understand. All of us purchase every day but we just think that is very simple such as when we wake up for a new day and go to school, you hungry and want to buy something to eat, then you buy a bread for breakfast and that all. This is thinking of customers. However, as the marketers or as a company, they cannot think like this. There is a process called “The consumer purchase decision making process” which help the company or the marketers to understand more about their customers to have influence on decision of them to gain more profit. Having 5 steps through this process and in some cases, no need to apply all these steps because each consumers have their own experience, cultural, characteristics…Let see what miracle things which Starbucks did with this process to take benefit from their consumers. Actually, Starbucks Sources: ladysovereign – weheartit......

Words: 2315 - Pages: 10

Starbucks

...CASE 1-1 Starbucks—Going Global Fast The Starbucks coffee shop on Sixth Avenue and Pine Street in downtown Seattle sits serene and orderly, as unremarkable as any other in the chain bought years ago by entrepreneur Howard Schultz. A few years ago, however, the quiet storefront made front pages around the world. During the World Trade Organization talks in November 1999, protesters flooded Seattle’s streets, and among their targets was Starbucks, a symbol, to them, of free-market capitalism run amok, another multinational out to blanket the earth. Amid the crowds of protesters and riot police were blackmasked anarchists who trashed the store, leaving its windows smashed and its tasteful green-and-white decor smelling of tear gas instead of espresso. Says an angry Schultz: “It’s hurtful. I think people are ill-informed. It’s very difficult to protest against a can of Coke, a bottle of Pepsi, or a can of Folgers. Starbucks is both this ubiquitous brand and a place where you can go and break a window. You can’t break a can of Coke.” The store was quickly repaired, and the protesters scattered to other cities. Yet cup by cup, Starbucks really is caffeinating the world, its green-and-white emblem beckoning to consumers on three continents. In 1999, Starbucks Corp. had 281 stores abroad. Today, it has about 7,000—and it’s still in the early stages of a plan to colonize the globe. If the protesters were wrong in their tactics, they weren’t wrong about Starbucks’......

Words: 3679 - Pages: 15

Starbuck

...factors accounted for the extra-ordinary success of Starbucks in the early 1990s? Many factors accounted for the extra-ordinary success of Starbucks in the early 1990’s. Starbucks owns nearly one-third of America’s coffee bars, which is more than its next five biggest competitors combined. Almost all of Starbucks’ locations in North America are company-owned stores located in high-traffic, high-visibility settings such as retail centers, office buildings, and university campuses. This made Starbucks a very convenient coffee bar because of the many different locations. Starbucks also worked to add more depth to their product in the coffee shops. In addition to selling whole-bean coffees, these stores sold rich-brewed coffees, Italian-style espresso drinks, cold-blended beverages, and premium teas. Product mixes vary depending on the stores size and location; however, most stores offer a variety of pastries, sodas, juices, coffee-related accessories and equipment, CDs, games, and seasonal novelty items. Starbucks also sold products through non-company-operated retail stores such as hotels, airlines, and restaurants. Additionally Starbucks formed joint ventures to distribute a bottled frappuccino thru Pepsi-Cola and an ice cream thru Dreyer’s Grand Ice Cream. This allowed the Starbucks’ brand to be recognized not only in freestanding Starbucks stores, but also throughout other channels as well increasing their brand awareness. Starbucks worked very had to expand the number of......

Words: 1949 - Pages: 8

Starbucks

...Introduction The history of Starbucks started in Seattle in 1971. Three friends, Jerry Baldwin, Zev Siegl, and Gordon Bowker, who all had a passion for fresh coffee, opened a small shop and began selling fresh-roasted, gourmet coffee beans and brewing and roasting accessories. In 1987, they sold the Starbucks chain to Howard Schultz, which rebranded the Il Giornale outlets as Starbucks and quickly began to expand. Starbucks opened its first locations outside Seattle at Waterfront Station in Vancouver, British Columbia, and Chicago, Illinois, that same year. Starbucks sells drip brewed coffee, espresso-based hot drinks, other hot and cold drinks, coffee beans, salads, hot and cold sandwiches and panini, pastries, snacks, and items such as mugs and tumblers. . Through the Starbucks Entertainment division and Hear Music brand, the company also markets books, music, and film. Many of the company's products are seasonal or specific to the locality of the store. Starbucks-brand ice cream and coffee are also offered at grocery stores. Starbucks' position its Starbucks outlets as a place where consumers can spend time other than that of their home or work. Their mission statement is “to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time”. This was done by making each of its stores as comfortable and relaxing as possible. The coffee giant achieved these through its comfortable furniture and relaxing music. Starbucks first......

Words: 3605 - Pages: 15

Starbucks

...Behavior Starbucks Mission Statement At Starbucks coffee company the mission is to nurture and inspire the human spirit-one person, one cup, and one neighborhood at a time. Starbucks coffee company is a multinational organization and emphasizes on always brewing the freshest coffee around. Starbucks core values are to always comply with the law and practice ethical standards. Culture of Starbucks Starbucks welcomes a diversity of people and customer’s. Starbucks create an awesome work environment and treats people with respect and dignity. They are committed to serving the best quality, and most responsibly grown coffee, to help create a better future for are growers. At Starbucks people are known as partners, not employees because it is not just a job it is a passion. Here at Starbucks we embrace diversity to help create a place where people can just be themselves. Customers of Starbucks connect with one another through laugher and fun even if it is just for a few minutes. It starts with a great cup of coffee, but their work goes beyond that. Really it’s about human connection and enjoyment. Each store is part of a community and they take being part of the community serious. Espoused Values Starbucks coffee is and will always be about quality and a sense of belonging. They are passionate about ethically sourcing the finest coffee beans, roasting them with great care and to help improve the lives of the people who grow them. Here at Starbucks are employees......

Words: 786 - Pages: 4

[CLASSIQUE]-Roberto Alagna - Credo - Airs sacrés-2007(WEB.flac.16bit)(onasimlap) | Eternity Fansub | What Is Economics - 338 Words