Starbucks'success Of Starbucks

1669 Words7 Pages
Starbucks’ success in the early 1990s could be mainly attributed to Howard Schultz, the one who took over the company from the Starbucks’ founders. There were three factors that contribute to the success of Starbucks. Firstly, Schultz had a very clear vision about the company, which was to cultivate the coffee drinking experience in the nation, making Starbucks the “Third Place” of ordinary citizens and the leading brand of the industry. With this vision, Schultz began to open a large number of new stores that widely spread over the nation, aiming to make the brand go public, be recognized and shared through word of mouth. The company barely spent money on advertising, but the brand became well known itself because of the large presence of…show more content…
The value proposition of Starbucks was mainly lead by a brand strategy called “Live coffee” that aimed to maintain the coffee culture in the nation by creating a coffee experience that make customer desire to incorporate into their daily lives. The strategy contained three key elements. The first and the most basic components was the premium quality coffee. Since people at that time had limited options for high-quality coffee, Starbucks aimed to provide the highest quality coffee in the world. In order to achieve this goal, Starbucks controlled most of the supply chain and sourced its coffee from different countries that produce coffee beans. As a result, Starbucks created a highly differentiated value proposition compared to other companies. Second, Starbucks intended to provide great services that develop customer intimacy, making the customer feel that they were important. For example, Starbucks encouraged the customer to customize their own drinks, and the partner of Starbucks turned to recognize and know the customer to deliver the most suitable services. Lastly, the company wanted to create a cozy atmosphere that made the customer spent their time there. Therefore, Starbucks had “seating areas to encourage lounging and layouts that were designed to provide an upscale yet inviting environment for those who wanted to linger”. All of these features combined together make a compelling value proposition. The value proposition of Starbucks was not just about
Open Document