Marketing Management of Starbucks - Research Paper Example

Starbucks Taste Test The entry and success of McDonald’s and Dunkin Donuts onto the coffee scene pushed Starbucks into action (Glover, 2009). To help Starbucks stay afloat, marketing research, defined by Kotler and Keller (2006, p. 96) as “the systematic design, collection, analysis, and reporting of data and findings relevant to a specific marketing situation facing the company,” should be conducted. This is in line with the “product concept” (Kotler and Keller, 2006, p. 15), which assumes that consumers are attracted to better products. Company managers with this orientation strive to make their products the best and for continuous improvement. An experiment, specifically a blind two-group experimental taste test, will be conducted to find out whose latte has superior taste. The research questions are: 1. Does a Starbucks latte taste better than a McDonald latte? 2. Does a Starbucks latte taste better than a Dunkin Donuts latte? The taste test is an example of a sensory test, in which the instruments for investigation are the senses themselves (Liedtke, et al., 2005). Many such tests have been conducted. Some examples are: 1. Gunnarsdottir and Thorsdittor’s (2010) study on the effect of food packaging on the perceived taste of healthy food by children; 2. Urdan and Urdan’s (2001) experimental analysis on the effect of brand name and taste on consumers’ buying intentions; 3. Studies that assess the taste and off-taste in drinking water by using quantitative taste and odor measurements compared with threshold numbers to evaluate compliance with government regulations (DWI, 2002); and 4. A comparison of taste test ratings after repeated consumption of different strengths of iced tea (Vickers and Holton, 1998). The experiment will involve a blind two-group experimental design, like those used for clinical drug trials. An example is Burgess, Lee, and Matlock’s (2007) “Randomised, Controlled, Assessor Blind Trial Comparing 4% Dimeticone Lotion with 0.5% Malathion Liquid for Head Louse Infestation”. The hypotheses are: 1. Ho: A Starbucks latte tastes the same as a McDonalds latte. Ha: A Starbucks latte tastes better than a McDonalds latte. 2. Ho: A Starbucks latte tastes the same as a Dunkin Donuts latte. Ha: A Starbucks latte tastes better than a Dunkin Donuts latte. Method Participants Though Starbucks has long insisted that it does not market to children, the young population is often seen drinking their beverages (Linn, 2007). Stratified, quota sampling will be employed. There will be six sets of sixty participants each, totaling 360 participants, stratified by age (11-19; 20-29; 30-39; 40-49; 50-59; 60 and up), where each set will have 30 males and 30 females, to control for age and sex, factors for which taste norms have not been determined (Moretz, 2006). Participants will be randomly assigned to a control group or intervention group by computer-generated randomization schedule, where each group will equal thirty participants, with equal numbers of male and female participants and stratified by age. This process is blinded, so that participants will not know their group assignment. Participants will be recruited through advertisements in the newspapers. They will be informed of their full rights and compensation and will be asked to sign consent forms. Research ethics shall be strictly followed. Interventions The control group will be given three cups (fifteen ounces each) of Starbucks latte. The intervention group will be given one cup (fifteen ounces) each of a Starbucks, McDonalds, and Dunkin Donuts latte. Administration of cups will be rotated. Both groups will be asked to rate each cup on a five-point scale (very good, good, neutral, bad, very bad). Both descriptive and inferential statistics will be employed upon analysis of results. Variables and Controls The dependent variable is the perception/measurement of taste of the lattes. The independent variable is the brand of latte, i.e. Starbucks, McDonald’s, and Dunkin Donuts. The mediating variable is the function of the taste buds. The moderating variable is the regularity with which the participant actually drinks latte. Familiarity with the latte taste may enable a respondent to pick out which drink is actually Starbucks, etc. Those who like lattes may rate higher or lower than those who are not fond of lattes. The control variables are age and sex. In sum, the controls put in place to ensure internal validity were: 1. Age was controlled, because norms for taste as a function of age have not been determined (Moretz, 2006). For example, if this control were not put in place, those younger may favor the sweeter Dunkin Donuts drink, while the older participants may favor Starbucks. 2. Sex was controlled, because taste as a function of sex has not been determined (Moretz, 2006). For example, women may favor the sweeter Dunkin Donuts drink, while men favor the strong McDonalds latte. 3. The amount of drink was limited to fifteen ounces each. If the participants were given more of the Starbucks latte than the Dunkin Donuts latte, they may favor the Starbucks latte. 4. The administration of drinks was also controlled. Participants may favor the first drink given or the last drink, depending on which they remember. The model for the experiment is shown in the Figure 1 below. Figure 1. The Starbucks Taste Test Model The test does have internal validity. Major intervening variables, including instrumentation, were controlled. Since the test is administered only once, maturation, mortality, testing and history do not apply. The test does have external validity. The samples should be large enough to suffice under the law of large numbers, one of the basic theories in statistics. Limitations One major limitation of the experiment is the taste test itself. There is no standard method for measuring taste function, and taste norms have not been determined for the different age and sex groups. However, taste strips have been invented that regulate the amount of sample delivered to the tastants, can limit a taste to specific regions of the mouth, and last longer than other samples (Moretz, 2006). This test does not make use of those taste strips. Though participants may rate Starbucks higher than its competitors, this does not ensure that consumers will flock to Starbucks once the results are released. Starbucks must still take into account the pitfalls of the product concept, which are pricing, distribution, advertising, and selling properly (Kotler and Keller, 2006, p. 15). Because many harbor the perception that Starbucks is automatically more expensive (Glover, 2009), the better quality taste may not suffice to attract them. References Burgess, I.F., Lee, P.N., & Matlock, G. (2007). Randomised, controlled, assessor blind trial comparing 4% dimeticone lotion with 0.5% malathion liquid for head louse infestation. PLoS ONE, 2 (11). Retrieved from doi:10.1371/journal.pone.0001127 DWI. (2002, Feb.). Review of test methods and criteria for assessing taste and off-taste. DWI0821. Retrieved from http://www.fwr.org/waterq/dwi0821.htm Glover, K. (2009, Feb. 6). Starbucks, Dunkin' Donuts, McDonald's: Coffee rivals fight breakfast war, BNET. Retrieved from http://www.bnet.com/blog/food/starbucks-dunkin-donuts-mcdonalds-coffee-rivals-fight-breakfast-war/432 Gunnarsdottir, I., & Thorsdottir, I. (2010). Should we use popular brands to promote healthy eating among children, Public Health Nutrition. Retrieved from doi:10.1017/S1368980010000893 Kotler, P. & Keller, K.L. (2006). Marketing Management (12th ed.). NJ, USA: Pearson Education, Inc. Liedtke, C., Christ, I., & Wiesemann, F. (2005, May). “Sensory Fit Panel” – development of a new advertising claim: Support method to assess aesthetic diaper fit performance in an objective, reliable and reproducible way. Journal of Business Chemistry, 2 (2). Retrieved from www.businesschemistry.org Linn, A. (2007, September 10). Starbucks rethinks stance on young customers: Company acknowledges that teens and children are part of market base. Retrieved from http://www.msnbc.msn.com/id/20608492/ns/business-consumer_news/ Urdan, F.T., & Urdan, A.T. (2001, June 19). The effect of brand name and taste on consumers’ buying intentions: An experimental analysis. Retrieved from http://papers.ssrn.com/sol3/papers.cfm?abstract_id=273841 Moretz, P.M. (2008, June 12). Researcher develops new method for taste testing. Retrieved from http://www.medicalnewstoday.com/articles/110820.php Vickers, Z. & Holton, E. (1998, July). A comparison of taste test ratings, repeated consumption, and postconsumption ratings of different strengths of iced tea, Journal of Sensory Studies, 13 (2). Retrieved from DOI: 10.1111/j.1745-459X.1998.tb00083.x Read More