Unicorn Fappuccino Case Study

Starbucks utilizes a differentiation business model by offering an overall unique and high quality experience for the consumer. From the high-quality food and drink options, to the uniquely roasted coffee and supreme customer service, Starbucks aims to provide an experience unobtainable anywhere else. Starbucks also focuses heavily on rapid expansion by seeking out profitable geographical areas and overcrowding those areas with stores in order to exploit profits and slow down competitors. Starbucks’ compliments this with its horizontal acquisition strategy, extending their product line through acquisition of competitors. This provides Starbucks with a differentiation strategy focused on providing a diversified product mix

Starbucks is rated as the number one World’s leading coffee distributor. Customers satisfactions are always be in the center of their business and the company works consistently to maintain it as customer look forward to a unique experience when visiting one of Starbuck stores. With over 12,000 stores worldwide, Starbucks has always aimed at achieving and maintaining competition in the industry.  Starbucks success reside in many factors :  the company is admire and respected worldwide,employees are recognized and respected for what they contribute to the success of the company. Open communication

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.

Starbucks roasts high-quality coffee beans to make espresso drinks and sells coffee products through multiple retail channels. The company has over 24,000 stores in 70 countries. Starbucks target market is affluent adults ages 18-40. This market segment makes up 49% of the company’s sales. In addition to targeting a specific market, the company employs a differentiation strategy. Along with the high-quality coffee, the company offers an experience within their stores which justifies higher products. Some aspects of this “coffee experience” include free Wi-Fi, friendly baristas, fast service, and comfortable seating. Also, the company relies on new product development as a strategic choice. This includes adding alcoholic beverages and food to its coffee shop. All of this is done with the idea of making the higher priced product worth it for the consumer.

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

Customer service is probably the most valuable intangible product that a company may sell. It may create both satisfaction and dissatisfaction. It is a process whereby a service provider offers help to the customers who need it or it may as simple as a human assistance to the customers who are dealing with the company or organization. It is a tool that an organization may use to gain loyalty from the customers besides offering good tangible products. For example, customers may expect good service when buying new apparels, but this is unlikely to be the primary factor in deciding whether to make a purchase (Businesscasestudies.co.uk., n.d.). Factors like price, comfort, style and brand are likely to be more persuasive (Businesscasestudies.co.uk., n.d.). However, a bad service can lead to dissatisfaction and discourage the buyer to make a purchase.

Have you ever been so tired during the day you need a wake up call? I have and Starbucks gives me an extra boost of energy to complete my day. Many consumers buy the product thinking it will help you get energy, find their true love, that it will help your day get better or that it’s all natural. It does this by using pathos, logos and perceived value.

Based on my personal experience I don’t really know a lot about Starbucks, but as everyone else I have tried their coffee. I was really very satisfied as a customer for their quality and service. Reading the case study on the book and searching on Starbucks’ main web page I explored many things

High Quality Customer Service: By providing superior customer service, there will be positive future growth. This is done by focusing on customers and providing services and products they want. The sales initiatives are specifically designed to meet the needs of their customers. This is why they are ranked in the top 20 best performing companies and Home

Starbucks has created a competitive advantage with their product quality by setting themselves apart from their competitors. “The Company has stayed with the upper-scale of the coffee market, competing on comfort rather than convenience, which is the case with its closest competitors, McDonald’s and Dunkin Donuts” (Mourdoukoutas, Panos). Consumers believe they are receiving a better product and experience when they purchase from a Starbucks as opposed to another large food service company that may sell coffee.

Good customer service will set my company apart from the strategic differentiation of my competitors also use of technology, pricing, and quality products. When I start my new venture with my exercising unit, I want people to know just how well my product works.

Customer service can help to build positive relationships with customers, increase sales and lead to loyal and returning customer which can have a positive effect on the business and indeed the industry as a whole.

We believe such a dramatic growth have led to current customers’ dissatisfaction. That’s also the reason why brand image have had some rough edges and why the historical customer profile had expanded and Starbucks’ newer customers tended to be younger, less well-educated and lower-income ($65000 in average) and less loyal (according to exhibit 8). These changes aren 't fatal because the company is still growing in aggressive manner, but in our opinion this trend may lead to future losses, because lesser loyalty and decreased image may sign that brand has no clear strategy and clear target audience.

Having a good customer service will also increase the profit of the business. When they are able to identify new products and services, it will help the business to provide good facilities to the customer. As the customer

The market research team has also discovered that Starbucks’ customer base is evolving. The customers tend to be younger and less well educated. Regardless of this insight, customer behavior remains the same. According to Figure A in the case study, the typical customer visits just five times a month. I believe this is in part due to Starbucks’ inability to meet customer expectations and increase satisfaction. In order for the company to increase the frequency of customer visits, customer satisfaction must improve. Thus, the ideal, most profitable consumer for Starbucks is one who is a