Starbucks

2874 WordsJan 3, 201312 Pages
Starbucks: Delivering Customer Service Howard Schultz’s idea with Starbucks in the mid 1980’s was to create a chain of coffeehouses with a product differentiation of specialty “live coffee”, service or customer intimacy with an “experience”, and an atmosphere of a “third place” to add to their work and home alternatives. The original stores sold whole beans and premium-priced coffee beverages by the cup and catered primarily to affluent, well educated, white-collar patrons (skewed female) between the ages of 25 and 44. By 2002, there were over 5,000 stores around the globe. The company spent minimal dollars on advertising to promote a brand concept. Enforced exacting coffee standards by controlling the supply chain as much as possible,…show more content…
Baristas jobs were complicated by the fact that many products required numerous steps to complete the order. They had installed automated espresso machines in some stores for the customers use to reduce wait time. Introduced a prepaid card that could be used to pay for products in the stores Starbucks had no centralized marketing program. Sales data was accumulated, and it was the responsibility of management to request that specific data be analyzed. The goal of Starbucks was to expand store openings as rapidly as possible. They were opening almost 3 new stores a day. New stores cannibalized existing store sales, but Starbucks did not see that as an important issue. There was very little image or product differentiation between Starbucks and competing chains. The newer customers were younger, less educated, in lower income brackets, had less frequent visits, and had a different perception of Starbucks. Concern had been expressed that Starbucks had lost the connection between satisfying our customers and growing the business, Starbucks wanted to serve the customer within 3 minute time window. Is that going to add customer loyalty? Starbucks wanted more handcrafted time consuming choices for consumers. Is that going to add to customer loyalty Starbucks sees themselves as selling innovative products, do the customers see them this way or as a specialty coffee commodity store? Rise of coffee consumption in the US with the largest growth being that of specialty coffee.

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