They crafted specific “specialty” drinks to the typical tastes of the populaces that fit this precise category. This directly contributed to Starbucks’ initial success. 2. As Starbucks became more and more successful a big change occurred from the original plan of the company. Many costumers began to realize that the people who ran the company started to care more about the capital than they do of the customers.
2. The major sources of risk: (1) Saturation in the U.S. market and crowded stores makes Starbucks harder to grow in U.S.; (2) Challenge of attracting the next generation of customers; (3) Dissatisfaction with the employees. Potential solutions: (1) Expanding into international market; (2) Providing new coffee products with lower price, and supplying customized food and other non-coffee items with a special atmosphere, such as a high-speed wireless Internet service; (3) Creating a better environment for employees to work and
Company Q references the high crime-rate areas of the two neighborhoods in which it served as the reason for closing those two stores. However, if you look further into the situation, it appears that Company Q mainly has only itself to blame for those store closings. Company Q cites that the two stores were losing money but gave no indication as to why they were losing money. Were they losing money because it took years to fulfill requests by customers for more health-conscience and organics products? Had those customers already found an alternative store that did provide the requested goods and in turn moved their business?
Most owners of a chain stores are said to be only interested in a making a profit instead of supporting the local community. By closing this store, the social responsibility has not been met, because it would increase the unemployment rate in the community, leading to more crimes. A growing number of consumers are becoming more aware of the products they buy, but also how the goods and services they buy have been produced. Consumers are concerned about human rights, environmentally harmful production and animal welfare issues that revolve around products they purchase. Customers are prepared to buy products from companies that have retailers who act ethically and socially responsible when purchasing products to sell in their stores.
Interestingly, Starbucks faces a unique problem since they are actually improving their service yet the customers are still not necessarily recognizing the progress. As we can see in Exhibit 7, Service, Cleanliness, and Average Wait Time are all improving. Product Quality is the only measurement that suffers over the measured quarters. In addition, on Page 5, we can see that there is tension between product quality and customization of regular customer drinks. This slowed down service but by adding additional staff, this maintains the customization while increasing throughput.
As the nation’s, and probably the world’s, largest company, Walmart has revolutionized the way Americans shop. Walmart provides a one-stop shop where you can buy any item needed for the lowest price available. They have become an example to the industry on how to be a successful company. However, in order to obtain and maintain all of this success, Walmart had to change some of America’s business principals, which has not been beneficial for the country in the long run. Walmart’s low prices are a direct result of their outsourcing of jobs, which negatively affects the United States’ economy, even though may seem beneficial.
The political Concerns that Starbucks faces are things like tax policies, government safety regulations, trade tariffs, government and international stability. These political factors all affect Starbucks and have an impact on its business. An example would be the ICA (International Coffee Agreement) quota that the government of the USA retreated; this meant that price control and coffee quotas had now ended. The ICA previously controlled the price control and coffee quotas, but after the removal of the agreement, farmers would now suffer as well as Starbucks for an external factor that was out of their control. The Economic concerns are too do with the Economy and recently the economy has been on a decline meaning that the purchasing power of Americans has resulted in the demand of Starbucks products and services to fall.
Answer 2) The Differences between 90’s and 2002 Communicates a different Brand Image: In the 90’s Starbucks was associated as a comfortable place to hang around in with their value proposition based on customer experience. However, in 2002 the brand image of Starbucks has been of a commercial/ corporate like entity. The brand moved from “Premium Quality” to “To-go Coffee”. Profile of the customers The profile of the consumers in the 90’s was individuals with high-income, college degrees with a consumer demand skewed towards high quality. However, a typical 2002 consumer had lower income and had lesser education.
Starbucks Case Study December N. Diarra February 17, 2012 MBA6012 Abstract This case study is an analysis of Starbucks Corporation and how they execute a strategic marketing plan that has been successful for them as a company. A company may have a wonderful product, but without strategic posturing, identification of a target market and an innovative marketing plan a company will not be able to successfully market its products to consumers. The coffee market has evolved over and has become more competitive. This paper focuses on how Starbucks differentiates its self from other competitors to gain and maintain a leading position in their industry. When it comes to business strategies and market approach, Starbucks is switching from being profit oriented to becoming more consumer centered.
The main risk they have to face is that suppliers may change its customer, Starbucks, because not everyone will accept the condition that Starbucks demands. This can lead to a shortage of raw material of coffee beans and reduce also the quality of the product harming the brand image. 5. Which strategy for managing stakeholders most closely correspond to the way Starbucks responded to the criticism it received from the “fair trade “movement? Be able to justify your choice.