Starbucks’ is a premium valued brand; costly to imitate. Its human capital deploys it operations and provide supreme customer support (Geereddy, n.d.), while organizational direction and culture is impacted by leadership (Kokemuller,
Threat of substitutes is high; coffee could be substituted by other beverages such as tea, juice, water, and sodas. Bargaining power of buyers is also high since Starbucks has become very popular, and because they are maintaining customer satisfaction. The demands on Starbucks’ products are high which implies that the bargaining power of suppliers will also be high. And of course, competition is always available, therefore competition is always high. Starbucks SWOT Analysis In this SWOT analysis, we will examine the strengths, weaknesses, opportunities and threats of Starbucks Corporation.
Originally, Starbucks was a trendsetter with its unique brand positioning and differential values. It offers not only food and services, but most importantly, experiences. Starbucks can gain high customer motivation to pay with relatively low cost and earn reasonable profits. Its "non-brand" decisions, such as licensing arrangements, store locations and drive-through service, may financially make sense over a short period of time (Ferrell and Hartline, 2014, p. 527- 528). However, such short-term financial growth is in sacrifice of brand positioning and equity in the long term.
The increase in average temperatures and the turning of rainy seasons destroy large parts of farmers' yields and impede the overall yield of coffee. • Competitors The main potential challenges facing Starbucks are increasing competition from other retailers with similar concept of products. These competitors are able to stand out in the markets to generate customers. The main competitors are Dunkin Donuts, McDonald’s and Costa. It is essential for Starbucks to know their rivals and what they are currently doing to gain completive edge over them.
Starbucks Coffee Company, founded in 1971, has grown to an international brand. As the world’s biggest coffeehouse company, Starbucks continues to lead the industry in sustainable business and innovation. Such success is attributed to the firm’s ability to address the external PESTEL/PESTLE factors. The PESTEL/PESTLE analysis framework indicates the most significant influences on Starbucks based on characteristics of the remote or macro-environment. Despite its current industry leadership, Starbucks must continue monitoring its remote or macro-environment.
The Success Mantra: There were multiple factors which contributed towards the massive success of Starbucks. The story of how Howard Schultz managed to transform a commodity into an upscale cultural and lifestyle experience is a page taken out of the fairy tales. The key driver behind Starbuck’s success was its ability to leverage the capital market to it’s maximum potential. It was able to create a niche market for itself by triggering a ‘Latent’ demand which addressed to the ‘Unstated Need’ of the affluent, well educated, white collar patrons (skewed female) between the ages of 25 and 44. The idea was to create a chain of coffeehouses that would become America’s “third place” - place that would be separate from home or work, a place that would
Executive Summary Starbucks is an American coffee chain that began operating on the 31st of March 1971. Since then they have grown and expanded to over 24 000 outlets globally. Starbucks has a extensive Corporate Social Responsibility (CSR) programme. They are committed to Ethically and Sustainably 1Sourcing their Tea, Coffee and Manufactured Goods. This means that they hope to reach their goal of 100% ethically sourced cocoa, 65% ethically sourced tea and manufactured products by 2020.
Customers appreciate its ethical sourcing of raw materials and are happy to pay more for Starbucks products. Even though the company does not hold the first place in the UK market, which is held by Costa Coffee, they have acquired a strong customer base of students, as well as their normal target group of working class. Based on the findings from the Marketing Mix, Starbucks has successfully created value for their customers. (Shubber, 2015) They have succeeded in growing their cafes into experience and a place for people to meet to spend their time. In the recent years Starbucks has expanded their sales channels from cafes to smaller pop-up units inside shopping areas, bookstores, college campus and airports.
This strategy will bring more revenue to the company and will put the Starbucks on the map with other great small shops. The brand has also positioned itself best coffee brand in the market by providing attractive store design, unique environment, elegant taste and high quality coffee beans (Kotler & Keller, 2009). Risk management in Starbucks organization is very important and the company takes them very seriously. The company cannot afford mistakes or failures, so they hire the best of the best to managers and employees. The company has a very tough hiring process, because they want to be sure that the person they are hiring is a perfect fit for its position.
In contrast to that, Starbucks always try to integrate to local cultures in different country. For example, they sell dragon dumplings and mooncake in China. Besides, they offer different mugs and tumblers in different countries to an extent that collecting Starbucks mugs has become a hobby for their customers or travelers. As a result, Starbucks is still ranked 1 in the