Marketing strategy of Starbucks - Essay Example

FINAL PRESENTATION PROJECT My presentation I will be examining and analyzing the portfolio of advertisements that are utilized by Starbucks where I currently work. The major segmentation criteria that Starbucks use is psychographic segmentation that targets customers based on their attitudes and lifestyle (Pham-Gia, K. 2009). Starbucks’ main aim is to establish loyal customers as well as reducing brand switching by providing various products and better coffees regularly. Utilizing the combined push-pull strategy, Starbucks mostly depends on promotions, advertising, internal marketing, personal selling, and public relations. Starbucks is among the most successful and admired coffee companies worldwide. The company serves more than 30 various brands of blend coffee, as well as iced beverages together with other related products. Starbucks’ major competitors include outlets that are involved in coffee selling and the other types of hot and cold drinks, normally along with snack foods. The core Starbucks’ customers are the serious coffee drinkers, who the company attempts to reach through adverts and promotional materials that reflect on the quality of its coffee and portraying the company’s dedication to offering its esteem customers with the best coffee (Gurski, D. 2014). With the ever increasing emphasis on the importance of social responsibility, Starbucks seeks to establish customers’ market who is interested in their products because they are socially conscious. Starbucks’ are aimed at coffee drinkers and also talk directly to customers who have an interest in transforming the world, one cup of coffee at a time. The adverts are aimed at coffee drinkers and also help Starbucks to project a socially responsible image. Starbuck being a lifestyle brand and it aims at attracting a wider demographic of customers hence it provides many products for the non-coffee drinkers who still wish to be associated the Starbucks’ social environmental making it possible for the company to create its customer base. Starbucks is attempting to involve its customers in the product in many ways. First, the company is marketed as a status item hence it is high involvement (has higher psychological, economic, and social risk) cheaper coffee or unbranded coffee from its competitors. Secondly, Starbucks is utilizing different campaign, like “Bold Coffee” campaign and the “Via” taste challenge so as to get its customers to come to the store continuously and try the new products. This is a perfect use of the buyer behavior theory that predicts that the customers could switch brands only to try a new thing. Offering its customers with a new flavor to try every week, the company actively manages the natural inclination of the customers to try new things. These strategies together with emphasizing on socially responsible behavior, the company are also offering customers with additional benefits on which they can evaluate its products. Through building a strong brand that its customers are loyal to, implying that the customers don’t even consider the other brands whenever they are going for coffee, immediately they will choose Starbucks since it’s the coffee for any person who loves coffee. These are the strategies that are employed by Starbucks to keep its existing customers satisfied (Simon, B. 2009). Promotion is the most common promotional mix elements utilized by Starbucks are internet marketing, advertising, public relations, personal selling, and sales promotion (Michelli, J. A. 2007). In terms of advertisement, the company spends a little percentage of its total revenue from advertising. Starbucks relies to a bigger extent on the company’s image advertising, like television and movie placement, so as to promote business success. Whenever Starbucks advertises, it uses print media most of the times at the marketed targeted by Starbucks tend to be people who are educated who are more reading. In internet marketing, the company uses a lot of money and promotion on interacting with its customers. The internet promotions are normally done in a way that enables the customers to interact with the product or even leave their comments, even if they aren’t directly able to interact with the Starbucks employees. Starbucks engages in individual selling through their dedicated baristas in the store. The company focuses on customer service by offering the perfect cup coffee to its customers all the times. In terms of public relations, Starbucks is normally involved in charitable causes, and this is high-lightened in its promotional materials. Starbuck also does sales promotions. The company utilizes a push promotional strategy, which includes active engagement of customers through direct selling channels and emphasizing advertising and promotion. The company also has elements of a strategy being utilized, as Starbucks has established a highly visible brand so as to encourage customers to try out its products a strategy that helps maintain its customers and even expand its customer base. Starbucks’ adverts often don’t have pricing information since product pricing is premium (Simon, B. 2009). This is due to the commitment of the company to high-quality products and high customer service level. The only time price is mentioned when the company associates low prices with suspicion and the way higher prices can transform peoples’ lives. The company uses pricing strategy to reinforce its brand as a socially responsible product and to assist in price justification. Starbucks uses promotions where it offers customers products for free for trial, and it doesn’t engage in any price promotions. The brand of Starbucks is all about its product, its customers, and the relaxing in-store experience. The adverts effectively communicate the brand, more so repeated brand logo that utilizes complex graphics to assist in product identification. The elements of the brand that are communicated in the adverts include rich taste, high quality, various choices of complementary beverage and food, friendly, warm, and a homelike-store atmosphere, and socially caring a fact that Starbucks hope to propel its products to sell more (Gurski, D. 2014). So as to maintain exclusivity, Starbucks, main distribution strategy is sales through stores (Pham-Gia, K. 2009). The company is currently embarking on the “Via” sale ready brew coffee so as to complement its coffee beans sales, all of which can be found directly from only the store. Adverts are clearly trying to bring customers to the stores so that they can try the new products and the new coffee flavors. By having its products only available through Starbucks is in harmony with the image that Starbuck wants to portray. References Gurski, D. (2014). Customer Experiences affect Customer Loyalty. Hamburg: Diplomica Verlag. Michelli, J. A. (2007). The Starbucks experience: 5 principles for turning ordinary into extraordinary. Maidenhead: McGraw-Hill. Pham-Gia, K. (2009). Marketing strategy of Starbucks Coffe. München: GRIN Verlag GmbH. Simon, B. (2009). Everything but the coffee: Learning about America from Starbucks. Berkeley: University of California Press. Read More