The Urban Coffee Opportunity is to help get Starbucks Coffee Company stores into ethnically diverse communities. Starbucks Company followed product diversification strategy by the acquisition of Evolution Fresh, Teavana, and Bay Bread as it didn’t follow the franchising model. Retrieved from Entrepreneur Asia Pacific: https://www.entrepreneur.com/encyclopedia/competitive-analysis, Loob, W. (2013, January 31). Study for free with our range of university lectures! The coffee market can be divided into consumers segment by where the coffee is drunk, In-Home vs. Out of Home; and type of product, Soluble (Instant) vs. The key people behind the formation of Starbucks were Zev Siegel, Jerry Baldwin, and Gordon Bowker. Starbucks was estimated to have a 4% share. Average age for an established customer was 38, new customers was 42. Starbucks Company Our team of external consultants has been queried to assess the gourmet coffee market for Starbucks Co. in order to develop a marketing … Starbucks Corporation has one of the world’s strongest and most popular brands. Starbucks segmentation, targeting and positioning. Market and Value Chain Analysis of Starbucks just from $13,9 / page. Starbucks Background and Starbucks History, SWOT Analysis of Starbucks / Starbucks SWOT Analysis, Backward Supply Chain Integration Strategy, Monetary Policy Tools – Federal Reserve System | Investment Analysis, Operations Strategy – Starbucks | Operations Management, Societal Marketing Concept – Principles, Advantages, Disadvantages,Examples,Instruments | Principles of Marketing, 5 Secrets About Nike PESTLE Analysis That Nobody Will Tell You | Management Notes, Portfolio Management – Risky & Risk Free Assets | Investment Management, Perceptual Errors - Fundamentals of Organizational Behaviour | Management Notes, Importance of Organizational Behavior - What is OB? (Johnson. Starbucks Company is not only focused on making profit but also is carrying out social and ethical responsibility equally. Starbucks is the biggest coffee chain in the world has been constantly focused on providing premium coffee to its customers by bringing innovation in its products that bring a unique and wonderful experience for the customers. Customers are able to socialize, read, study or enjoy music while drinking coffee. Starbucks expanded the target market to include customers of every age. The Starbucks has to compete in the market ranging from the various international companies such as donut king and Mc Donald to the coffee shops which are situated locally. 2.1 Primary Research: Large, established companies, typically expend considerable resources conducting marketing research, either through their own internal research departments or by contracting with outside research firms. You are to provide a management report that must address the following 3 questions: The company is constantly focusing on the product innovation process that helps in offering new products to retain the existing customers and to attract a diverse group of new customers in the international market as the business is operating widely in the global market. It has become a well known name for quality coffee. The Company has expanded its market around the globe with the opening of the outlets in different countries for reaching a large group of customers and gaining a competitive advantage. Political factors include government regulations and legal issues and define both formal and informal rules under which the company must operate. Starbucks Company Market Analysis. Examples of how Starbucks has used market trend data, digital consumer feedback and in-store product testing are the launches of its dairy-free milk alternatives. The mission statement of Starbucks Company is to “inspire and nurture the human spirit- one person, one cup, and one neighborhood at a time”. The company has spent around $350 million in marketing and advertising in 2015. Starbucks rst opened in Seattle in 1971 (Starbucks, 2014) and has grown from one store to 19,767 stores today. This expansion developed the brand as we know it today. The company offers expensive products but has a great product quality that allowed the company to sustain its premium image among its customers because of the high quality and amazing experience offered by the company. The different promotion mix of Starbucks is: Both traditionally and through digital medias using television, print media, and the internet (company’s website). Market analysis in the Marketing strategy of Starbucks – Coffee consumption in globally is growing at the rate of 2%. Among all the products offered by the Company, the main product of Starbucks is its high premium coffee that offers a unique experience to its customers which is different as compared to the coffee of its competitors. This analysis will list the 6 factors i.e. They understand that Starbucks is more than just a brand of coffee, but instead, it’s an experience that a person is savouring in the morning during their coffee time. Learn how your comment data is processed. Starbucks wants to open new stores in both new and existing markets, expand their product development process, and cater to customers ‘needs to eventually improve their financial position and dominate market share. Its nearest competitor is Dunkin which has over 9.5 thousand stores.  Strong Market Position and Global Brand Recognition: Starbucks has a significant geographical presence across the globe and maintain a 36.7% market share in the United States (Appendix 1) and has operations in over 60 countries. The PEST analysis examines the broad environment in which the organisation is operating. Businesses in the coffee industry are susceptible to many external risks, most of which they are not able to control or even influence. Starbucks segmentation, targeting and positioning comprise marketing decisions directed at identifying appropriate group of people among the general public as future customers for the business and targeting this segment via positioning products and services that resonates well with their needs and wants. A high-level overview of Starbucks Corporation (SBUX) stock. Starbucks Case Analysis. A relationship like this could be useful for marketing and b… In the UK, Costa Coffee has approximately 39% market share. Let’s dive in a … The Starbucks go-to strategy was to bring the already established product in different cultural and geographical space into the new market — the coffee-culture deprived United States. Starbucks was estimated to have a 5% share. Registered office: Venture House, Cross Street, Arnold, Nottingham, Nottinghamshire, NG5 7PJ. Do you have a 2:1 degree or higher? Starbucks 4P’s of Marketing Mix is described as follows: Some of the Major Products offered by Starbucks are: Among all the above products the main product of Starbucks is its high premium coffee that offers a unique experience to its customers which is different compared to the coffee of its competitors. Out of $24.71 billion revenue, the company generated 16.7 billion US dollar from the American market. Starbucks has adopted a “Premium Pricing Strategy” for its products and has been able to create a premium brand image in the customer’s mind (Friesner, 2014). Retrieved from Panmore Institute: http://panmore.com/starbucks-coffee-marketing-mix-4ps-analysis, Li, S. (2017, August 13). The above strategies adopted by the company helped it to gain competitive advantages over its competitors. Starbucks uses various distribution channels for making its products available to its customers around the globe in order to maintain a direct and personal relationship. Although Starbucks is already made a sustainable position in the market, it still has to make constant efforts for promotional activities. From simple essay plans, through to full dissertations, you can guarantee we have a service perfectly matched to your needs. The U.S market accounts for the majority of Starbucks’ revenue. the original target market has not disappeared, but has expanded into the demographic of the store location. ; Imitability of products – Starbucks doesn’t own the most unique products in the market… (Johnson & Scholes, 1999) There are the four key areas in which to consider how current and future change can affect the business of Starbucks. According to Lock (2020) it has approximately 14.88 thousand stores in the country. Strategic Analysis of Starbucks Corporation Introduction Back to 1971, Starbucks’s story began in the Pike Place Market in Seattle (U.S.), as a roaster and retailer of whole bean and ground coffee, tea and spices in a single store. Starbucks is successful to satisfy the market needs and changing demands through new innovations and by establishing new products. Any opinions, findings, conclusions or recommendations expressed in this material are those of the authors and do not necessarily reflect the views of UKEssays.com. Costa Coffee, Starbucks, and Caffe Nero together have 53% market share. [. A number of players have entered into this market ranging … We're here to answer any questions you have about our services. Search Strategic Analysis Of Starbucks Corporation. Notify me of follow-up comments by email. That means in the United States they had 11,168 stores, 7,087 company operated stores and 4,081 licensed stores make up this staggering number. Starbucks Case Analysis 1693 Words | 7 Pages Starbucks Case Analysis Background The company started its activity in 1971 as small coffee shop located in Seattle specialized in selling whole arabica coffee beans. GREENSPAN, R. (2019, February 27). (Knowles et al, 2001) As Starbucks is expanding internationally, trade restrictions, tariffs, tax policies and employment laws of related to their business countries have influence upon Starbucks. It is worth noting that Costa Coffee is a subsidiary of The Coca-Cola Company. Starbucks has many coffeehouses in the … They have comparably more income. This includes content and social media marketing in which Starbucks was one of the pioneers and has the presence in websites like Twitter, Facebook, Pinterest, G+, YouTube, and … A secondary target audience is men aged 20 to 45. Copyright © 2003 - 2020 - UKEssays is a trading name of All Answers Ltd, a company registered in England and Wales. Starbucks 1. We've received widespread press coverage since 2003, Your UKEssays purchase is secure and we're rated 4.4/5 on reviews.co.uk. Ground coffee. The Company is using BCG (Boston Consulting Group) Matrix Strategy in order to review the portfolio of its products for finding out the product to invest in, product to discontinue or develop. This is not an example of the work produced by our Essay Writing Service. Conducting the Starbucks PESTLE Analysis, we have found that the Starbucks has been the all-time favorite hangout café, meeting spot or just a nice quiet little space to have a coffee and read your favorite book. Reference this. During 2015 and 2016, this brand has invested nearly $350 million on the marketing campaigns. In their own words, Starbucks describes this as, “champions business practices that help produce social, environmental and economics benefits of communities in which we operate”. To export a reference to this article please select a referencing stye below: If you are the original writer of this essay and no longer wish to have your work published on UKEssays.com then please: Our academic writing and marking services can help you! Starbucks operates over 10,000 retail stores. The Company along with these strategies has been adopted according to the technological pace by introducing “Starbucks App” both for Apple and Android. Starbucks menu contains brewed coffee, espresso traditions and, favourites, cold beverages, coffee alternatives, frappuccinos, and the, From the beginning when Howard Schultz took, over Starbucks, he believed, “Partner satisfaction leads to customer. Howard Schultz’s task was to closely observe how Italians treat the product and figure out a way to bring it home with minor … The Company offers a wide variety of products like baked goods, Frappuccino, Smoothies, beverages, etc. Starbucks target market has been changing over time in response to the changes in the market. Together, the big three hold 68.1% of the total branded coffee market share. Starbucks on Tuesday announced it was partnering with Uber Eats to expand its delivery in the United States. Too much dependent on the US market with 8078 stores only in the USA. Essay on The Marketing Strategy Analysis of Starbucks Corporation Under today’s ever-changing market, strategic marketing planning has become more and more significant whether of the functional or the fundamental. Cultural Clash of American/European Coffee with other countries. Starbucks was founded in 1971, in Pike Place Market, nestled in Seattle with hopes of creating a “third place” between home and work. Starbucks was founded in Seattle, Washington in 1971. Starbucks Competitive Analysis Competitive Analysis is defined as one of the critical parts which deal with identifying the key competitors of the company’s product and services along with evaluating strategies adopted by competitors to determine their strengths and weaknesses as compared to the product and … See Starbucks Corporation (SBUX) stock analyst estimates, including earnings and revenue, EPS, upgrades and downgrades. Starbucks Corporation Report contains a full analysis of Starbucks segmentation, targeting and positioning and Starbucks marketing strategy in general. Coffee is the principle commercial crop. Strengths in the SWOT analysis of Starbucks. Out of $24.71 billion revenue, the company generated 16.7 billion US dollar from the American market. Dependence on the US market… Looking for a flexible role? Retrieved from Marketing91: https://www.marketing91.com/marketing-strategy-starbucks/, Essays, U. Market research company Mintel reports that during the period from 2012 to 2017, overall sales of dairy-free milk alternatives in the U.S. grew 61 … Dependency on the U.S. Market. Market research is at the core of many of the market entry strategies Starbucks is employing. Your email address will not be published. Retrieved from https://www.ukessays.com/essays/marketing/competitor-analysis-and-contemporary-trends-starbucks-marketing-essay.php?vref=1, Friesner, T. (2014, May 9). another target audience is women 20 to 45. Marketing mix refers to the set of actions, or tactics, that a company uses to promote its brand or product in the market. The music selection, furnishings, wide selection of coffee, and great customer service set them apart. Starbucks’ Market Analysis The case study reveals that Starbucks’ international presence is extensive. Starbucks has developed an internationalization strategy to enable the company to open stores and franchises in countries across the globe. Starbucks has adopted a “Premium Pricing Strategy” for its products and has been able to create a premium brand image in the customer’s mind. Starbucks holds the lion’s share in the U.S. coffee market at 40.1% followed by Dunkin Donuts and Tim Hortons. Disclaimer: This work has been submitted by a university student. Below is a detailed Pestle analysis of Starbucks, the premium coffee and beverages retailer. COMPANY ANALYSIS 1. These events had a negative impact on Starbucks’ brand image. Howard Schultz’s task was to closely observe how Italians treat the product and figure out a way to bring it home with minor changes. Geereddy, N. (n.d.). Starbucks locations serve hot and cold … Starbucks is considered the main representative of “second wave coffee”, initially … To make sure that Starbucks meets the longstanding competitive advantage it must address the various alarms being projected in the SWOT analysis of Starbucks. Market Starbucks built itself on being the world‘s most powerful and recognizable brands of high quality coffee and the unique ―Starbucks Experience.‖ They were the first to revolutionize the coffeehouse industry by marketing expensive, high-quality coffee as well as a ―third‖ place between work and home for customers to go and escape the chaos of daily life. Good Marketing: Starbucks gained popularity as a concept as well as a brand because of the good marketing is undertaken by the brand. That in the Pacific Northwest, there was one store for every 20,000 people whereas in the Southeast there was only one store for every 110,000 people. Market analysis in the Marketing strategy of Starbucks – Coffee consumption in globally is growing at the rate of 2%. STARBUCKS MARKETING ANALYSIS CRIS B 201501 ... category, a low market share but a high business growth rate. Starbucks Company is one of the leading American multinational Coffee Company which was founded in 1971 in Seattle, Washington as a single coffee shop. It identifies all the key strengths, weaknesses, opportunities and threats that affect the company the most. The primary marketing operations these are done by Starbucks are dividing the market into different segments, analyzing the current needs of the market and the marketing mix including products, prices, places, promotions and In-the-home consumption was an estimated $3.2 billion business. Stay up to date on the latest stock price, chart, news, analysis, fundamentals, trading and investment tools. The first Starbucks location outside North America opened in Tokyo, Japan, in 1996, while the Philippines became the second market in 1997. The thesis is carried out in a de ductive and quantitative method. Company Registration No: 4964706. Coffee being their staple product, they offer over 30 blends, which come from all over the world. Competitive Analysis. With the integration of all strategies it has been possible for Starbucks to compete with its direct competitors in the market like Costa Coffee, Dunkin Donuts, McDonald’s McCafe, etc. They package these as well as produce a premium handcrafted beverage in their stores. The limiting of impact on the environment comes in many forms, from materials they use to the way the coffee in produced. Marketing Strategy of Starbucks – Starbucks Marketing Strategy. Some Researches showed Starbucks was operating in over 300 Company-owned stores in the United Kingdom, Australia, and Thailand. However, Starbucks does not currently have a presence in Sweden, Bulgaria or Nigeria. Starbucks is depending on the U.S market which is a major weaknesses for the company. Technologies allow Starbucks to offer the higher standard quality products; its computerised roasters allow the company to create unique computerised curves in roasting coffee beans. You can view samples of our professional work here. We speak about target audeinces and target customers of … Starbucks is able to reach the global market by globalisation. Starbucks SWOT Analysis, Competitors, Segmentation, Target Market, Positioning & USP Published by MBA Skool Team , Last Updated: April 29, 2020 In Starbucks SWOT Analysis, the strengths and weaknesses are the internal factors whereas opportunities and threats are the external factors. The Starbucks go-to strategy was to bring the already established product in different cultural and geographical space into the new market — the coffee-culture deprived United States. The Company uses a backward integration strategy which is helping it to bring down the costs as wells as controlling the roasting, purchasing, packaging, and distribution of the coffee worldwide which helps in maintaining the taste and quality of the coffees around the globe(Bhasin, 2019). Following are the place mix of Starbucks Company: Previously the company used to sell its product through the Cafes. | Organizational Behavior, Key elements of Organizational Behavior | Organizational Behavior. STARBUCKS CORPORATION 1.1. Around the globe, the company was turned into a huge success with the effort of Howard Schultz. political, economic, socio-cultural, technological, environmental, and legal factors that … 0105.363.01 Marketing 20062 RIT Professor Marty Lawlor Team 5: Stacy Di Mora, Karyn Lewis, Sarah Lind Executive Summary. Place Mix determines the different locations and venues from which people can access the products. Starbucks is using both traditional and digital media to advertise its product and position its brand image. They changed the normal experience of going to a coffee shop. The Company is not only focused on profit but also is carrying out social and ethical responsibility. Social factors include the demographic and cultural aspects of the external environment. JAB owned brands such as Pret a Manger, Peet’s Coffee, and Caribou Coffee also put … Starbucks already has an existing connection to Sweden: CEO Howard Schultz previously worked with Hammarplast, “a Swedish housewares company which marketed coffee makers” (Subhadra and Dutta, 2003). Competitive Analysis is defined as one of the critical parts which deal with identifying the key competitors of the company’s product and services along with evaluating strategies adopted by competitors to determine their strengths and weaknesses as compared to the product and service of your company (Li, 2017). The purchases of the consumers are mostly influenced by several factors, which include but not limited to the quality of the coffee, the price, alternative coffee shops, and even the customer services offered (Ruiz, 2011). As of 2011, Starbucks … Now stores are located all over the U.S. Retrieved from Forbes: https://www.forbes.com/sites/walterloeb/2013/01/31/starbucks-global-coffee-giant-has-new-growth-plans/#1fca5bbb4f87, Your email address will not be published. 1st Jan 1970 Public Relations Campaign was done by a company like “Race Together”. Starbucks is using both traditional and digital media to advertise its product and position its brand image. If you need assistance with writing your essay, our professional essay writing service is here to help! Starbucks uses various distribution channels for making its products available to its customers around the globe in order to maintain direct and personal relationships. SWOT Analysis of the Starbucks Business growth of the Starbucks is dependent on the strengths possessed by its business activities and also from the competitive edge it attains in the market. Starbucks is the number one specialty coffee retailer that presents in 80 countries with more than 29,300 shops, in which 14,000 shops are managed through franchising agreement and the rest are owned and operated by Starbucks. It generates the largest part of Starbucks’ revenue and the highest number of Starbucks retail stores are also located in the U.S. Over these years, the brand has smartly managed a global supply chain to ensure the continuous supply of good … Starbucks also offers very few discounts and offers in its products. Tax avoidance scandal: Starbucks got a lot of criticism for not paying taxes in the UK during 3 consecutive years during the 2010s. Starbucks wanted to develop a reputable relationship with the customers, Most of companies enter in a new market y serving a single segment, and if this proves successful than they add more segments, initially Starbucks did the same thing targeted the parents with the young children and it was hit concept and it has … Growth in stores: It increased its number of stores from 1,886 to 31,256 between 1998 and 2019. they believe “people come here for the coffee, but ambience is what makes them want to stay,”. This Starbucks SWOT analysis reveals how the largest coffee chain in the world uses its competitive advantages to continue growing so successfully all over the world. Market positioning is strong with global brand recognition. This case study will consider how market research has strengthened Starbucks … It also throws light on the threat that the business can encounter to get the maximum benefit from the various opportunities in the international market. Marketing PESTLE Analysis of Starbucks Political Factors that Affect Starbucks As we all know, Starbucks mainly deals in coffees, so they have to source their raw materials from certain regions or countries. Our academic experts are ready and waiting to assist with any writing project you may have. … Starbucks Corporation’s Marketing Mix (4Ps) Analysis. This can be witnessed by the behaviour of Nestle , the market leader, who in 2009 (Chan 2009) also introduced a range of instant hot drinks targeted at local tastes to compete directly with other domestic brands who have specialised in domestic flavours such as “White Coffee” or “Kopi-O”. The promotion mix is mainly related to how the company uses different communication strategies to flow information about the company’s products and services to its customers. The website techfee tells us that 49 percent of Starbucks customers are from age 25 to 50. Americas are its main market and the brand earns a very large part of its revenue from the American Competitor Analysis And Contemporary Trends Starbucks Marketing Essay. SWOT analysis is a powerful tool that is used by the company to assess its external and internal factors for evaluating strengths, weaknesses, opportunities, and threats of the company. However, while the U.S. is an excellent market for coffee brands, opportunities also abound outside U.S. International expansion can bring much faster growth for Starbucks. No plagiarism, guaranteed! The mission and principles are listed among many other aspects of the company on their web site, starbucks.com. Developing nations are the big potential for the companies in this industry. Market research is at the core of many of the market entry strategies Starbucks … SWOT Analysis of the Starbucks. Starbucks: Global Coffee Giant Has New Growth Plans. Starbucks was estimated to have a 4% share. The U.S market accounts for the majority of Starbucks’ revenue. Free resources to assist you with your university studies! Sep 17, 2020 (MarketersMedia) -- Wiseguyreports.Com Publish New Market Research Report On-"Coffee Market 2020 Global Analysis, Size, Share, Trends, Opportunities and Growth, Forecast 2026" See instructions, Starbucks had to shut down its stores in Australia because of not understanding the Australian concept of Coffee (Essays, 2018).]. Starbucks targets this group creating the “third place” to go to between home and work by creating this unique and relaxing “experience” and “atmosphere” as customers within this range tend to have high income and professional careers 20. Examples of how Starbucks has used market trend data, digital consumer feedback and in-store product testing are the launches of its dairy-free milk alternatives. It has also found out that the fast food industry is also giving good competition to the Starbucks. But how can we see the real truth? Its high prices reduce affordability for the consumers. Expansion into emerging international markets. With the integration of all strategies it has been possible for Starbucks to compete with its direct competitors in the market like Costa Coffee, Dunkin Donuts, McDonald’s McCafe, etc. Starbucks maintains good relations with their suppliers and are loyal to their customers. Operating in more than 70 countries around the world. Starbucks is the market leader in the USA in terms of number of outlets. The strategic use of different marketing channels affects the profitability of the business. Starbucks appeals to its target market through different tactics already mentioned. Developing nations are the big potential for the companies in this industry. A management report that must address the various alarms being projected in the UK, Costa coffee and... 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