Internal and External Factors Affecting Starbucks

5296 Words Aug 24th, 2014 22 Pages
Internal and external factors affecting Starbucks
Founded in 1985, Starbucks is one of the largest coffeehouse companies in the world with over 16,000 stores in 50 countries. This report evaluates major internal and external factors affecting Starbucks using various analytical techniques. Based on the Starbucks brand in UK, it identifies suitable marketing strategies for Starbucks to expand its business in the UK market within the next two years. In line with the chosen marketing strategies, recommendations for the marketing mix are discussed.
Founded in 1985, Starbucks is one of the largest coffeehouse companies in the world, with over 16,000 stores in 50 countries (Starbucks Annual Report, 2009, p. 1). Starbucks sells high-quality
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341). It is aimed at identification of internal and external forces that may influence the company’s performance and choice of strategies in the future (Kotler et al., 1999, p. 111).
A number of analytical techniques can be used to evaluate a company’s environment. Starbucks will be analyzed using the following marketing techniques:
(a). SWOT Analysis
(b). Porter’s Five Forces
(c). PESTLE Analysis
3.1 SWOT ANALYSIS
In this technique, internal strengths and weaknesses of a company and external opportunities and threats faced by it are closely examined to chart a marketing strategy for the future (Forsyth, 2010, pp. 102-106). Major strengths, weaknesses, opportunities and threats of Starbucks are analyzed below.
3.1.1 Strengths
(a). Brand
Starbucks has developed a brand image that has revolutionized coffee drinking experience. It has created an ambiance that is designed to attract customers and keep them coming back to Starbucks stores. It offers wide varieties of services such as comfortable seating areas with unique music and free wireless Internet for their customers while sipping their favorite coffee. This distinctiveness sets Starbucks apart from most of its competitors and has allowed the company to successfully grow and profit while charging premium prices for their products. (b). Loyal Customers
Owing to the strong brand recognition, most customers
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