Tradtional marketing activities like conducting a market research, advertising, and promotional activities are among the least important factors that could significantly affect the creation and development of customer value (Kumar 2004, p. 5). Therefore, Starbucks decided to…
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This strategy creates new business opportunity for Starbucks. By increasing the efficiency of the baristas in terms of delivering the order of its valued customers within the shortest period of time possible and maintaining the cleanliness and friendliness of the staff who are working within Starbucks coffee shops also creates competitive advantage for the company.
Almost a decade ago, Starbucks has been focused on saturating the domestic market in the U.S. Since the company has already saturated the U.S. market, Starbucks began expanding its business within the global markets. Since anybody can easily establish their own coffee shop, competition within the coffee industry is very tight.
As explained by Porter (1998, p. 1), competitive advantage is referring to the “search for a favorable competitive position within a particular industry”. Using the four major assumptions we have mentioned earlier, Starbucks management was able to successfully develop a competitive advantage in terms of improving the quality of services the company has been extending to its valued customers.
There is a very tight market competition with regards to domestic and global markets of coffee products. In line with this, rivalry within the coffee industry is tight due to the fact that the capital requirements in putting up a coffee shop are not so expensive. This makes barriers to entry within the local and international coffee industry low. Since anybody can easily sell brewed coffee, the threat for substitute products is very high.
Improving Starbuck’s services increases its market share within the coffee industry. Therefore, the company has gained more power over its suppliers. Since the company is able to purchase its raw materials by bulk, Starbucks is able to purchase its raw materials at a relatively low price. Considering that there are a lot of existing coffee shops around
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(Case Study (Starbucks) Example | Topics and Well Written Essays - 1000 Words)
“Case Study (Starbucks) Example | Topics and Well Written Essays - 1000 Words”, n.d. https://studentshare.org/miscellaneous/1567689-case-study-starbucks.
Starbucks has realized that in order to move ahead within the social and cultural spheres, it must draw a line as to how it will tap the opportunities that come by and how it will cater to the needs, wishes and desires of its intended target audiences time and again.
Starbucks Company then sought to undertake this initiative of jump starting alternative low-calorie candy products. This however was a little bit higher than the health limiting levels. Because of the constant criticism faced it decided to reduce the size by dividing a single bar into two bars, and then they promoted the two bars that they made claiming that a person can have the other part later.
Starbucks sells brewed coffee, espresso-based hot drinks, hot and also cold drinks, snacks and products for instance mugs and coffee beans. Starbucks has an entertainment division and Hear Music brand, Starbucks also markets music, books and film. A lot of these items are seasonal or specific to the locality of the store.
Each one of them had invested about $6,350 in the store, and believed that they would build a client base in the Seattle area. This was a strategic decision because each one of them has a very clear vision of huge market of fine coffee. Since then, Starbucks stores network is ever increasing and it has 6,500 retail locations all over the world from Latin America to Europe and Middle East to Far East and it has become so popular and well known, that in near future it would be as recognizable as major names such as McDonalds and Coca-Cola (Kembell et al.
Starbuck has grown from less tan 1,000 stores to more than 15,000 stores currently and this growth has lead to the watering down of the ultimate Starbucks experience. Some of the problems it faces are:
Design of the store is such that it focuses more towards achieving economic efficiency then reflecting the traditional look.
According to the report, it determines the basic principle of Starbucks whose objectives include customer values, employees and suppliers. The company has come across certain issues concerning its services marketing system and levels of customer satisfaction. The coffee shops of Starbucks face crucial issues like customization.
Starbuck’s embraces corporate social responsibility where it aims to carry out its operations in a manner that promotes social environmental and economic benefits to the immediate society. The paper will seek to answer how the Starbuck’s
The Company established a joint venture with a local retailer to ensure that the foreign licensees adopted the company’s successful formula (The New York Times 1). The licensed venture bore the mandate of growing company’s presence in foreign countries. Employees and