Starbucks Case Study Essay

When Starbucks first became a Public Traded Company in 1992, there were only 165 stores open at that time. The company set a goal for growing 125 stores per year and rapidly expanded until reaching 11,000 U.S. stores in 2008 (Starbucks website). When Starbucks first opened, it focused on the experiential. At its best, the coffee giant truly represented the ‘”third place” between home and work where a customer can chat with the barista, order a drink to his specification, then settle in for conversation, socializing, and relaxation (Wikipedia). People were not paying $3 per latte because it tasted that much better than Starbucks’ competitors. They were paying it because they could go into a Starbucks and get that European café feeling and then take the

The survey questions mostly consisted of multiple choice questions, two open-ended questions, allowing written responses, and one qualitative response question. These questions were chosen to establish consumers differences and comparative perspective of Starbuck’s competitors, their daily usage of the social media platforms, the coffee shops visited frequently, and their opinions on consumers who frequent Starbucks. The survey contains one matrix/rating scale question ( Appendix I, Question 5) based on how important qualities are when choosing a coffee shop. Lastly, there were two demographic questions. The demographic questions are for a general understanding on consumers behavior based on age group and gender. For an overview of the survey, see appendix I.

(3a): What trade-offs has Starbucks made? What different activity choices has it made from its rivals?

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.

I believe their growth is the result of both practices. First Starbucks offers a product the consumers want, and they offer an atmosphere unlike any other. As a result of the recession, they looked at more affordable offerings to keep the customer base they already have. I feel this is one reason the company has continued to being profitable during this last recession. If I was a Starbucks customer, I would still continue

2. When Starbucks was rapidly expanding its store locations in 2006–2009 it made specific changes in order to facilitate that growth. What did Starbucks gain—and give up—as a result of each change?

Starbucks is known for their Frappuccino’s; unfortunately they are on a downward spiral in sales due to competitors such as McDonalds. In 2008 Starbucks admits to its losses due to their competitors. “Company executives now freely admit that such thinking is largely to blame for the woes that led to Tuesday’s announcement that Starbucks will close 600 U.S. stores and eliminate thousands of jobs. The coffee giant’s missteps have come at a spectacularly bad time, hitting as the economic slump deepens and consumers are seeing their discretionary spending eaten up by rising gas prices and grocery bills (Linn).”

This assignment is based on the Starbucks case study; Trouble Brews at Starbucks written by Lauranne Buchanan and Carolyn Simmons (2009). The aim of this paper will be to discuss the the changing consumer experience, competitive landscape and external circumstances affecting marketing opportunities for Starbucks, while determining how Howard Schultz can provide Starbuck’s customers a greater long-term value.

Starbucks’ lead in the specialty coffee industry exemplifies the result of deftly executing a well-planned business strategy. Moreover, Starbucks is well positioned for what is expected to be a continuing rise in the popularity of specialty coffee products. The question before Starbucks’ leadership, however, is what avenues will lead to Starbucks’ goal of remaining true to its core, the highest quality coffee products while providing a “total coffee experience” for its customers?

I've chosen the Starbucks Corporation on which to do my case assignment for the session. I first became interested in Starbucks while working on a paper for a previous marketing class. I became intrigued at the entrepreneurial spirit that such a large corporation had managed to maintain throughout its massive expansion. Starbucks corporation, unlike many of its now-defunct rivals, has done an outstanding job since its meager beginnings in 1970 with the execution of its strategic process; resulting in it currently owning 40% of the specialty coffee market and boosting annual sales exceeding $7 billion according to Burt Helm. Historic successes and recent turmoil within the company, including a near 40% decline in 2007 in profits (Sullivan

Even so, just two weeks earlier Howard Schultz announced that the company will be expanding internationally. The plan is to open more than 1500 stores in Germany, France, and Britain over a 3-year span (Forbes, 2008). It is estimated that this expansion will boost revenue by more than 20 percent (MSN Money, 2008). In spite of Starbucks’ struggle among its love-hate relationship between customers and protesters, one thing that Starbucks

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

In general the coffeehouse industry in the United States was experiencing an increase in coffee consumption per capita due to the “Starbucks effect”. At this time Starbucks was operating approximately 20,000 stores in the United States and was living a fast expansion strategy worldwide.

Starbucks dates back from 1971 and is based in Seattle, Washington. The company was founded by Gordon Bowker, Jerry Baldwin and Zev Siegl and it

Following its success in the United States, Starbucks ventured overseas and quickly became a globalization icon. With its rapid globalization strategy, Starbucks expanded from about 5000 stores to an estimated 15,000 stores in 2000 (Groth, 2011). By mid-2000s, Starbucks’ supply chain faced many issues, resulting with challenges of having to fulfill expansion strategies yet minimizing escalating operation expenses. By 2008, Starbucks’ stocks fell by 42% (Schultz, 2011). The rapid expansion took a toll on the sales growth and stretched the limits of the existing supply chain, which then rippled down to erode the customer-valued ‘Starbucks experience’ (Gibbons, 2011).