There are countless flavors of Starbucks coffees available in “k-cups” for, giving the consumers more choices for their morning cup without having to wait in line. Due to the international presence of the Starbucks brand, consumers can travel to another country and still be able to order their favorite cup of coffee. There are other brands, like Biggby, that have tried to copy the Starbucks business model by offering similar products (coffee, scones, bagels, etc. ), but Starbucks is at an advantage due to their early presence in the market. Consumers are more than willing to wait in line, listening to countless complicated orders just to get their coffee.
Rising prices of coffee beans and dairy products. Health conscious consumers Cases over illegal use of the Starbucks trademark Recommended Solutions / Actions Starbucks’ product pricing is expensive compared to their competitors. They should reduce their product prices by using cheaper beans to produce new type of coffees. Starbucks can offer promotions and special discounts to their customers as well. Such as buy one free one, or buy one and get 50% off for the second cup.
Product: Starbucks mainly specialized in coffees and but also sells other beverages such as premium quality teas, ice-blended beverages, pastries and some of their merchandise like for instant tumbler and mugs. They still continued to innovate more of their products to cater to attract more people to buy their product. For example, in 1994, Starbucks starting selling Frappuccino at their store. Price: Starbucks announced in 22nd September 2010 that there will be an increase of prices for their beverages due to the increasing prices of raw materials such as coffee beans. They tried to maintain the prices to make it affordable to everyone.
Changing consumers’ preference can also affect the sales of coffee and the business of Starbucks. The company needs to focus preferences of customers, where they strive to serve the best coffee possible at the highest standards of quality to its customers in order to provide a delightful customer experience. According to (Morrison, 2013) ‘’they provide more than 30 blends of coffee and a variety range of exceptional products to the customers’’, such as cold and hot coffee, salads, sandwiches and other snacks. They can enjoy their products at stores, home, and on the go. Starbucks attracts a wider range of customers including people of different ethnic backgrounds and ages.
The Starbucks mission is to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time (Starbucks, 2016). In 2007 Starbucks was expanding rapidly, mainly aiming towards strategic global expansion, neglecting their customers’
Tata Coffee is the biggest supplier of Arabica Coffee; so this agreement would help Tata sell its coffee and Tazo tea in the Indian markets while Starbuck will have a continuous supply of coffee from Tata. 4) Come to a realistic agreement on the time to market and corporate expectations Starbucks decided to enter the bottled segment at the right time by joining hands with PepsiCo and introducing Frappacino. Starbuck was able to enter a different market than its usual coffee mugs and PepsiCo got a new innovation. 5) Mutual, flexible commitment on what’s appropriate to change, measure and share within each partner’s culture The alliance with Barnes & Nobles bookstore lead to boosting the culture of drinking coffee while reading a book. Nowadays each Barnes & Nobles bookstore is having a small coffee shop selling Starbucks coffee.
Unlike before, not all baristas were hand-picked who had mastered ‘both’ the hard-skill and soft-skill required for the job. Moreover, the diversification of customer base and increased product portfolio meant that they had to deliver ‘customer-made’ beverages as quickly as possible and maintain the ‘customer intimacy’ quotient at the same time. The above table clearly states that the most profitable / valuable customer for Starbucks is a ‘Highly Satisfied Customer’ with an average lifetime revenue of
Founded in London in 1971, Costa is the nation’s favorite coffee shop and the largest coffee shop chain in Britain. Costa Coffee is also the leading retailer and roaster. According to Costa’s official website, they are the only coffee shop business in the world that source 100% of their beans from Rainforest Alliance certified farms. Unlike Starbucks that uses automatic coffee machines, each and every cup of Costa Coffee is made using the beans that have been slow roasted for 22 minutes in Costa Roastery in London and handcrafted by Costa’s baristas. This is to ensure a smoother flavor, which can produce a bitter taste (Dana, 2010).
Starbucks has success to operate in CSR. There are various factors to affect the company succeeds of Starbucks in CSR. First of all, A company need development of a good brand image and responsibility into society. Company builds conscience of brand image is the most important in business. Starbucks is demand to provide high-quality
Internal Analysis Strength & Competency - Convenience: High percentage of takeaway for specialised coffee shops - Experienced staff is hired to grill toast over charcoal and help provide quality health products to the customers - Wide food menu: New, different and healthy (coffee & tea-based beverages can easily be positioned as healthy) varieties of items have been introduced which will give Ya Kun benefit of product differentiation Organisational Weakness - Condiments i.e. Kaya jam, bread, are perishable items hence needs to be sold as soon as possible to gain maximum profit. Customers will also prefer fresh products - Lack of experience in a new market: will face stiff competition from local players - Shortage of manpower due to sudden increase