Global Marketing Operations of Starbucks

Starbucks is no doubt a phenomenon in the United States, but the brand wants to expand globally. Opening chains in various global locations such as Japan, Vienna, England; Starbucks wants to reach out to the coffee loving fans everywhere. Nevertheless opening chains globally is not that simple. There are many uncontrollable factors Starbucks need to focus on to make sure they are making profit as well has abiding by the country’s laws and regulations. Going global takes a lot of market research to make sure that the brand will be successful even with uncontrollable factors. Controllable factors can be tailored to fit the needs of each country. Starbucks has to find the happy medium so they don’t lose their identity overseas.

Many multinational corporations in the coffee industry have succeeded tremendously such as Starbucks. Each of these corporations has strategies that helped them continue to expand to nations of different cultures, ethnicities, governmental practices, and locations.

In 1971 Starbucks started as a small coffee shop that specialized in selling whole arabica beans in Seattle’s Pike Place market. After being inspired by Milan’s coffee culture - especially the role it espresso bars played in the Italians’ everyday social lives - Starbucks opened an espresso bar in the corner of their shop. Their ideal was to create a ‘third place’ - besides home and work - where people could relax and enjoy a good cup of coffee (Moon & Quelch, 2006). Over two decades the company enlarged and served over 20 million unique customers in over 5,000 stores around the world. Their brand strategy could best be described as ‘live coffee’, which meant creating an ‘experience’ around the consumption of coffee that fitted into people 's everyday lives (Moon & Quelch, 2006). Three components were fundamental for their branding strategy. First of all, the coffee itself which should represent the highest-quality coffee in the world, derived from Africa, Central and South America, and the Asia-Pacific regions (Moon & Quelch, 2006). Secondly, the atmosphere should be inviting and make customers feel comfortable. The ambiance in stores should make customers want to stay (Moon & Quelch, 2006). Thirdly, service - customer intimacy - is a key factor within their brand strategy, which aims to create an experience for the customers, and aims at building customer loyalty (Moon & Quelch, 2006). The employees - called ‘partners’ - are

Starbucks is a corporation well known for roasting, marketing and retailing of crafted quality beverage that is based on coffee. Starbucks started its operations in Seattle’s Pike place market with Howard Schultz helping in its marketing and retailing efforts. The company is extremely successful and focused on the development of positive company-customer relationships. Starbucks uses company-customer relationships and a customer-centered approach as its key business strategy. The customer-centered approach allows the company to maintain its current position in the market.

With the first coffee shop opened in Sydney CBD, Starbucks entered into Australian market in July of 2000 and then expanded rapidly to 85 coffee shops in the following years. However, in August of 2008, Starbucks Coffee Company Australia announced to shut down more than 60 of its 85 coffee shops and to date it has scaled down to 22 opened in Sydney, Brisbane, the Gold Coast, the Sunshine Coast and Melbourne (Starbucks 2010).

Starbucks is undoubtedly an international brand. The history of coffee traces back to Ethiopia, Africa, India, Arabia, and Europe, and has been traded abroad since the 11th century. Understanding the demand and widespread market for coffee, Starbucks has triumphantly capitalized both the domestic market, and the varied international markets as well. Possessing about 6,500 retail sites worldwide, Starbucks’ net is spread across thirty countries and has been found as one of the most recognized brands all over the globe in equality to McDonalds and Toyota. This organization’s ability to build an international brand has been unprecedented- particularly since it represents a specialty

First, Starbucks has effectively applied the product differentiation strategy. To achieve it, the company has specialized in different product mixes, aligned its business locations to a specific ambiance that suits the context, and varied the customer experience, thus resulting in a higher customer service satisfaction. Further, Coskun, Basligil, and Baracli (2008) note that Starbucks prides in having their customers enjoy a premium service. Therefore, the company’s signature strategy has worked well thus far, as competitors find it difficult to imitate. Second, the enterprise has coordinated its acquisition and portfolio strategy, thus consolidating the market. As discussed in the background chapter, Starbucks has a portfolio network of eight brands under its stable. Third, Starbucks’ international expansion strategy has worked well, with a presence in 70 countries (Starbucks, 2017). These factors, coupled with its financial capability, offer Starbucks an edge over its

A.   CASE  ANALYSIS       “Growing  Big  while  Staying  Small:  Starbucks  Harvests  International  Growth”     by  IAN  E  NIS  TIRYAKI                                         DATE         April  28,  2011  Thursday                                             A.  EXECUTIVE  SUMMARY   1. Situation  Overview   Globally  recognized  coffee  house  and  coffee  brand  Starbucks  has  changed  its  targeted   markets  more  towards

Starbucks has wide range of business activity. These activities allow the company to use numerous channels of product distribution. With the company operating in many locations worldwide environmental factors play a major role in marketing decisions. Each distribution channel is affected differently and the company's flexibility in the marketing plan allows the company to adjust their strategies to meet the needs of the environmental factors.

This drives the demand of the product , shifting the demand curve to right. Buyers expectation strongly affects the consumption . Expectation of technology for a consumer , wifi, card, mobile , e-commerce adds up to the demand. With increase in technology by the company the demand increases leading the demand curve to move to right. (http://www.forbes.com/sites/rahimkanani/2012/05/24/chief-digital-officer-for-starbucks-on-technology-change-and-community/)

In the north, Starbucks entered a joint-venture with Beijing Mei Da coffee company. In the east, Starbucks partnered with the Taiwan-based Uni-President. In the south, Starbucks worked with Hong Kong-based Maxim’s Caterers. Each partner brings different strengths and local expertise that helped Starbucks gain insights into the tastes and preferences of local Chinese consumers.

This case study gives an overview about Starbucks International Operations. It will explain how Starbucks expanded outside US and the strategies they adopted to give tough competition to its international rivals.

This case assignment discusses the history of Starbuck’s accomplishments as they entered the American coffee culture heritage. In 1983, The chairman and CEO Howard Schultz traveled to Italy and had a dream to carry the Italy coffeehouse ritual back to the United States. Schultz was focused on creating an environment meeting company that makes good coffee but also be a social experiment. Starbucks today opened more than 19,000 stores functioning in 62 countries. Starbucks has numerous rewards that globalization has offered and they have significantly benefited from it, while in the coffee industry. Starbucks has a wide-range in marketing strategies to benefit the customers. During the different obstacles that Starbucks has encountered, they must stay reliable in quality and uphold to adjust to different customer values.

Factors in the global environment provide both opportunities and strengths for Starbucks. Opportunities such as increased revenues, further expansions, and achieving their goal of becoming the most respected brand worldwide. Starbucks also faced threats. These threats include dealing with growing antiglobalization overseas and their huge risk of less return on each overseas store, this deriving from overseas operations being run by local partners instead of Starbucks

Starbucks’ retail entry model in the United States does not have the same strategy as their international model. In the states Starbucks holds great control as a corporation, but in international territory, country partnerships, cultural, government laws and politics play a very important role in Starbucks’ entry strategy. Starbucks has set it sights globally since the coffee market has come close to saturation in the U.S. which will give them the opportunity to continue to expand without fierce competition. Starbucks has looked to countries like India and other emerging markets with great growth potential to set down new roots. Starbucks recognizes India as a great choice to expand business internationally but also recognizes the complexity in the same market after several attempts to enter without success.