Starbuck Case Study Analysis

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yisStarbucks Case Analysis: I. Problem Identification and Decision To Be Made Starbuck’s main decision needing to be made is to determine whether they should allocate $40 million to extra labor in order to better satisfy their customers. Starbuck’s believes that they have created a recession proof product; however, recent marketing research determined that is not the case. Customer satisfaction has been steadily declining and their customer’s perceptions on what determines excellent customer service has changed in recent years. This change in customer perceptions is due in part to the fact that their customer base has shifted to a younger, less educated clientele that hold different attitudes toward Starbucks than the previous…show more content…
The reason we chose to make this decision was clear after studying the results from marketing research. In Exhibit 2, it is clear that convenience is rated among the highest of important factors creating customer satisfaction. One of the most obvious ways to increase convenience is to reduce the amount of travel time required to get a cup of Starbucks coffee. While fast service is still highly valued, it barely makes the top ten attributes. Starbucks has been very determined to offer a wide variety of drink selections to its customers, but doing so comes at a cost. That cost is speed of service. As drink complexity goes up, speed of service goes down. In my opinion, having a wide variety of drinks should be the least of their concerns, as Exhibit 2 clearly shows that new and innovative beverages is close to the bottom of the list of key attributes creating customer satisfaction. Next to this lies selection of whole beans. While Starbucks strives to be the industry leader in coffee variety, consumers do not seem to care. If bean selection were to be reduced just slightly, it may have a significant impact on profitability. When considering the other alternative, implementing a store rewards card program, we decided that introducing a trial period of this program into the new retail stores we plan to open will be the best idea.

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