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Coffee Chain in Uk

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Coffee Chain in UK
Costa coffee founded in 1971 in London, UK. Now, it has become the biggest top coffee shop chain in UK. However, Costa should be prepared for danger in times of peace. In this report, some suggestions will be proposed to improve Costa coffee’s marketing mix over the next three years. We begin with a brief description of the data we collected, then go on to analyses coffee shop market environment in UK; the next section looks at Costa coffee’s current statement of marketing mix, and finally we give recommendation of the marketing mix in the next year for Costa Coffee. Section 1 Primary research method Primary data was collected in the form of questionnaire with 15 questions, which was posted on the Internet. Also, …show more content…

Therefore, we do not recommend them adopting the expansion strategy in marketing, which means in next 3 years, one of marketing objectives should be retaining their profitability, market share and their leading position in UK. (Figure 2.1)
50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% 2006 2008 2010 2011 Starbucks Costa Nero other

Figure 2.1

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Micro-environment:
Threats of new entry Low average cost (+) Customers:

Competitors

Strong brand identity (+) Low entry barrier e.g. special knowledge and capital requirement (-) Competitors: Saturated market Many competitors with little differentiation (Starbucks and Nero) Suppliers

Low switching cost leads to low loyalty (-) Price sensitive (-) Low bargaining power (+)

Costa Coffee

Customers

Low bargaining power (+) High delivery cost (-) Unstable goods quality and quantity (-)

Tea/ hot chocolate/ Juice Fast food chains provide drinks

From the micro-environment analysis, competitors issue is their main inhibitor while others also affect their sales so that we recommend they should increase their customer loyalty to outstanding competitors in this market even though the customer could easy to change their buying behaviour. Target market: The results of our questionnaire in Nottingham suggest that some respondents used ‘pricy’, ‘expensive’ etc. to describe their feeling about Costa coffee. Meanwhile, Costa coffee describes itself as Italian

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