Starbucks Case Analysis Essay

1176 Words5 Pages
Subject: Starbucks Case Analysis

Having been through the great expansion and the economic depression, Starbucks has become one of the most valuable brands in the world by its ability to immediately distinguish consumers’ needs and fulfill those needs with extraordinary services. In other words, Howard Schultz has made Starbucks the solution to consumers’ unsatisfied need, which gives the brand a strong positioning that not only benefits the company, but also creates customer value. However, as the rapid expansion goes on and growth opportunities emerge, Starbucks also runs the risk of attenuating its brand equity as a result.

In order to evaluate the acquisition of the coffee equipment company, a situation analysis is
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Nevertheless, Starbucks gradually deviated from the position it originally set up at first for its customers. Experience has been its unique selling proposition, which includes the quality of coffee, the aroma and the decoration in the stores and the relationship between baristas and customers, but that has been compromised by the intention of mass distribution and cutting operation costs. Starbucks has reached ubiquitous presence with its products and enhanced the speed of service at the expense of perceived quality, so much so that customers have formed negative brand associations with it, such as referring to it as a heartless corporation, after aggressive expansion. It deteriorated customer-based equity (Keller, 2012). Although Starbucks might improve the brand performance and the variety of different usage situations, the brand image suffered from weakened favorability of brand association (Keller, 2012). As a result, the whole model of brand resonance (Keller, 2012) was affected and became less likely to build emotional connection with customers, which gave small competitors the opportunity to satisfy customers’ expectations that Starbucks failed to fulfill.

The problem was that Starbucks was too ambitious in trying to target all customers, but failed to pay attention to the needs of loyal customers who nourished the brand. According to “Rediscovering of Marketing Segmentation” (Yankelovich & Meer, 2006), a company

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