Starbucks offers a variety of coffee and coffee products in their retail stores and in grocery stores worldwide. Recently, Starbucks has added value to their retail stores with the expansion of their breakfast and lunch food selection, as well as with the arrival of the Starbucks Blonde Roast Coffee. Through value exploration, the avenue by which a company identifies new opportunities (Kotler & Keller, 2012, p. 58), Starbucks discovered there was a large group of consumers who preferred a milder roast coffee, when compared to the traditional dark roast coffees. In hopes of meeting consumer preference, the Starbucks Blonde Roast was developed and introduced as the newest brewed coffee by Starbucks. It is a “lighter, mellower roast coffee developed to meet the demands of consumers who requested that Starbucks create a lighter-roasted coffee.” According to Smyl & Edelman (2012), Brad Anderson, master roaster for Starbucks, said of Starbucks customers, “They told us they wanted a flavorful, lighter-bodied coffee that offers a milder taste and a gentle finish.
Specifically for Starbucks, they have built success of the franchise by developing a name brand and image that connects with the world. As Starbucks began to enter different markets, coffee remained the core product. Variations of the types of coffee offered in different parts of the world is what the management controls. This is based on research of the culture or region and the promotion of new products to engage consumers. For example, in Tokyo, a consumer stated that they wanted the coffee to taste sweet.
Coffee Roasters operates in the niche market of Fair Trade Coffees. Just Us! Coffee Roasters is wishing to expand their company, thus profits, which means that they face more competition from outside their niche market. As a result, Just Us! Coffee Roasters now must compete on a large scale against strong mainstream competition and well established local and international brands.
It is a win-win relationship for both parties. 2. What are the risks and benefits to SBX in pursuing these environmental objectives with CI? Risks: • Climate Change, water scarcity and community issues Benefits: • Starbucks mission/goals is to help farmers who grow coffee by helping to sustain coffee farmers and strengthen their communities, in term ensures healthy supply of high-quality coffee for consumer. • Gained better control on global markets.
At the start, was having created a successful brand strategy coupled with their rapid growth of new store openings in “high-traffic, high visibility settings”. As well, selling premium priced coffee in addition to whole beans. They were particularly skilled at choosing and catering to their target market of “primarily affluent, well-educated, white-collar patrons”. Their competitive differentiation came in creating an “experience” for their customers and specializing in ambience at their locations to encourage a place where the customers would want to stay and hang out. Schultz vision was to create a “third place” (other than home and work) for its patrons to want to be.
Over the years Starbucks has grown to understand the importance of working together and taking care of one’s investments. One way of ensuring that Starbucks always gets the best products (materials) is through ethical sourcing programs. Starbucks is committed to always buying and making available the best high quality, responsibly grown, and ethically traded coffee that will help create a better future for farmers. Examine the importance of demographics and physical infrastructure. Analyze the influence of
Employees have heard a rumor that Starbucks might be opening a store in the area. Right now we have competitive advantage, because we are only café which is specialized in coffee products. The situation will change when Starbuck will open a new shop. As Baltzan & Phillips (2009) have stated in their book that, “competitive advantages are typically temporary because competitors often seek ways to duplicate the competitive advantage” (p. 22). The café have first mover advantage to be first in business but Starbucks are technologically advanced and have wholesale coffee business in the market.
Some customers don’t like change and they like to feel comfortable with their products and services, this is where product development is useful as they are used to their usual product or service but it has been improved or changed in some way, for example Starbucks changing their coffees and using different types of beans shows they are interested in keeping the customer and the customer feels important to the business. Santander do this by changing their services for example offering better interest rates on loans to customers that have banked with them for over a certain time period, this could persuade non existing customers to start banking with them as they see the benefits
Starbucks was one of the first to create a product with such distinction and the product was sold both in the cafes as well as grocery chains. Another factor was the excellent customer service that they provided and finally, the atmosphere. People came to the café to buy coffee however; they were also drawn in by the atmosphere. Starbucks success rest on the facts that they: Started with a good business concept, thought big, thought outside of the box and partnered smart The most compelling thing about Starbucks value proposition was that Starbucks wanted to create an experience for customers that they could “weave into the fabric of their everyday lives”. This was important for top managers at Starbucks because instead of just having customers come in and out for a cup of coffee they can also think of Starbucks as a place to relax and meet with friends.
Thirdly, to resolve the issues of a widening customer demographic and unclear brand perception, Starbucks could engage in a promotion to encourage their most loyal customers as well as new business through promotions such as a free cup after “X” visits or a “club card” that encourages repeat business. For all three of these solutions, Starbucks would want to enact these solutions as quickly as possible due to the threat of eroding their brand perception. See Appendix C for rejected alternatives. Rationale for the Recommendation Adding labor hours is our first recommendation. Interestingly, Starbucks faces a unique problem since they are actually improving their service yet the customers are still not necessarily recognizing the progress.