Service Marketing of The Starbucks Coffee Corporation - Case Study Example

Service Marketing of the Starbucks Coffee Corporation Summary: The topic taken for literature review is service marketing of starbucks. the case deals with star bucks which is the largest producer of the coffee in the world, and the different marketing issues that are being prevailed in the market. It gives the information about the company and the literature review identified from the key issues that are relating to the service market. The pictorisation of the different marketing issues are been identified in the service market. About star bucks corporation: the Starbucks Coffee Corporation is the international coffee chain in the United States. It is the world’s largest producer of the coffee. It has an outlet of around 17000 all over the world and is operated in 49 countries. The Starbucks was founded in the year of 1971 in Washington with the three partners. Starbucks exhibit very high operational efficiency in the recession period and good sales in the period which may cause the coffee makers to re-engineering the process to cope with the trends. The branding strategy of the products are very good and it is made available in the different ways through the supply chain management possible, the second strategy include the customer intimacy and the encouraging experience in them, the third include the atmosphere that is based on the human experiences and the community. The efficient channels of distribution of the offers to the non company operated retail channels and the 15% of the revenue contribution is from the retail channel of distribution. The main philosophy of the Starbucks is the reach of the products to the customers irrespective of the time and the cost and making it available at an ease. The strength of the employees in the star buck corporation is very high and they have partners of around 60000 and in North America they have about 5000 partners. The employee turnover is very less in the star bucks. When an employee is recruited in the firm he is taught the hard skills like the maintenance of the cash book, vouchers and the soft skills like the pleasing personality and the good customer service. Market Issues: The marketing issues in the Starbucks are the labour problem in North America, The Starbucks in the urban areas pay good wages to the employees to retain the employees. The issues are also occurred in comparison with the barista efficiency by the non value added task. The competition is the issue where the star buck has against the small scale specialty; the different challenges are also faced in the new location for the corporation. “Starbucks’ arrival in the UK stimulated the market by forcing national competitors, such as Costa Coffee, to commit to expansion more rapidly then they might have, to beat the invader to the better sites, says Gary Davies, professor of corporate reputation at the Manchester Business School in the UK” (Karolefski). The different assumption that the coffee had a wide expansion was a incorrect, where there are 8 states in the US without the single company operated Starbucks. In less number of the outlets are in the different regions where there are 1 store for the 11000 inhabitants in the south east. One of the crucial undertakings of any service organization is the management of service quality. Quality of a Service is not easy to assess than the quality of a goods .service value awareness of the customer results from the relationship between the consumer belief and real performance of the services. Quality assessments of the starbucks are not only result of the service provided, it also include assessment of the method of the delivery of service. Customer form the anticipation about the service n numerous ways such as through advertisement, precedent experiences, idle talk between other persons etc…service quality may failure due to many reasons, such as due, assignment mistake-perform the employment wrongly and due to behaviour mistake-failure to respond or pay attention properly to the client.starbucks mainly faced the problem due to behaviour mistake. The service marketing issues in the star bucks are the labour problem that is particularly faced in the in North America. Service delivery failure take place frequently in any organization. Successful organization must acquire practical steps to diminish the incidence of service collapse. It is the duty of starbuck to acquire appropriate labour at adequate time to overcome the problems arises due to labour. Branding approach of Starbucks consisting of three mechanisms these three mechanisms having three own important to build proper brand image. According to a Brand Building Literature Review. BY FRANCISCO GUZMÁN (ESADE) says that “in a brand-oriented organization, the objective is -within the framework of the brand- to create value and meaning. The brand is a strategic platform for interplay With the target group and thus is not limited to being an unconditional response to what At any moment is demanded by customers” (Guzman 5). One of the main issues faced by the starbucks is Starbucks is failing to understand the customer’s anticipation. Needs and wants of the customer may change according to the time of consuming so if the company is in a position to provide service according to the taste of the consumer it will to increase productivity. According to Starbucks Marketing Plan by the Katie tewell, Bethany Odom, Kelly Snide (December 12, 2006) different tactic which need to implement the success of starbucks are Must increase customer satisfaction through improvements to service are “friendlier and more attentive staff, faster and efficient services, increase in personal treatment remember customer’s name and order), More knowledgeable staff, Better overall service, Offer better prices/incentive programs, Free cups after “x” number of visits, Reduction of price, Offer promotions, sales to increase customer satisfaction” (Tewell, Odom and Snider). Starbucks must identify the consumer’s desires and wishes cautiously before scheming a service maintenances programs. The consumer evaluate the apparent services of the organization through the projected services if the apparent services of the organization comes under the projected services of the organization consumers Are dissatisfied like if the consumers are satisfied with the service they are appropriate to make use of the service supplier again and again. It will help to increase the consumer faithfulness towards the services. Services quality is the one of the most important component in the business. The service quality is apparent at the time of consumer supplier dealings. Service organization must achieve the knowledge by way of study on value of the service. Various approaches are used by the firm to gather common as well as detailed issues connected to excellence of the service Starbucks identity is established due to the quality of service that it provides. Starbucks has an important customer-closeness which itself is the reason of its brand popularity. Service Quality of a firm is dependent on the final judgment of the customer, the relations of the customer to the firm and the physical environment quality in which the service is being provided. There is immense competition in the coffee business today therefore Starbucks has to improve its quality of service delivered in order to withstand competition. ”Starbucks had so successfully created and distributed its service in the United States that the Japanese were afraid they could not compete. But as Starbucks opened more stores (it now has more than 500 in Japan), the Japanese competitors were ready” (Zeithaml 441). Service quality is audited by regular client surveys, opinions of consumer jury, transactional study of customers etc. Core service of a firm implies the most important profit that the customer is buying from the firm. Here in the case of Starbucks the core service of the firm is to provide the best quality coffee in a very warm, friendly ambience. Supplementary services imply the other services that are required to augment the core services which include the changes in the supply chain programme of Starbucks including a change in the channel of distribution concept. Starbucks should improve both its core concept and its supplementary service simultaneously for proper service marketing. Since the firm also deals with packaged coffee so the firm should introduce new packaging concepts to further increase the speed of its service delivery. Starbucks will face severe problems if the top management ignores the problems which are of two kinds. The first one being inability to identify the unseen aspects of service delivery and the second one being ignoring the problems of the customer. The steps taken in the wrong direction ultimately results in the downfall of a firm. The company refers to its employees as Partners so the partners should be trained well as to how to behave with the customers. Daily incorporation of service rules is needed in constant service marketing. The revision of Starbucks checklists will enable the firm to develop its service marketing system. The commitment to customer should be detailed to all the employees. Starbucks can advertise its excellent service delivery in order to draw more customers. It can also introduce more health friendly drinks along with coffee in order to further increase its customer base. Starbucks “speciality operations” distribution channel should be improved. Service marketing delivery system can be improved in Starbucks because the company has already created a good image in the minds of the customers all over the world. The only incorporation it needs to undertake is to enhance the service marketing to its customer base by adopting newer methods of service delivery which will invite both the existing clientele of the firm and also will bring in fresh new customers to the firm. Conclusion: Starbucks should develop an appropriate service marketing mix in order to increase its service marketing. The service marketing concept involves the proper product mix with the addition of service mixes which are people, process and physical evidence. Recruiting and training of the proper staff, efficient service marketing process like quick service delivery and physical evidence like the atmosphere in which the product is being served should be taken into account while deciding on strategic marketing issues of Starbucks. Works Cited Guzman, Francisco. A Brand Building Literature Review. Web. 22 Feb. 2010. . Karolefski, John. Conquering New Grounds. Brandchannel. 2010. Web. 23 Feb. 2010. . Moon, Youngme, and Quelch, John. Starbucks: Delivering Customer Service. Harvard Business School, 2006. Tewell, Katie., Odom Bethany, and Snider, Kelly. Starbucks Marketing Plan. 12 Dec. 2006. Web. 22 Feb. 2010. . Zeithaml. Services Marketing. Tata McGraw-Hill. Web. 23 Feb. 2010. . Read More