StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...
Free

Analysis of Starbucks Coffee Company's Current Strategy - Case Study Example

Cite this document
Summary
The paper identifies the stakeholder's groups of the company, its key competitors, and an analysis of its current strategy. The paper derives some recommendations on the company’s current strategy. Starbucks stakeholders groups refer to groups or organization that has an interest in the company. …
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER93.7% of users find it useful
Analysis of Starbucks Coffee Companys Current Strategy
Read Text Preview

Extract of sample "Analysis of Starbucks Coffee Company's Current Strategy"

? Starbucks Coffee Company 10th August Starbucks Coffee Company Introduction Starbucks Coffee Company stands out as the largest coffee retailer, roaster, and brand of specialty coffee all over the globe. The company originated in Seattle, USA in 1971 but it has seen expanded its operations to over 60 countries with more than 18,000 stores. The company deals with a wide range of products that include coffee, warm, and cold beverages, premium and sell salads, books, gifts among other accessories. Starbucks overall mission is “to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time (Bruhn-Hansen, 2012, p. 19). Subject to its wide market network, high quality of its products, and the diversity of its products, Starbucks enjoys a magnificent customer base in the coffee other blend- drinks industry. In the report, the paper identifies the stakeholders groups of the company, its key competitors, and an analysis of its current strategy. The paper will also derive some recommendations on the company’s current strategy. Findings Starbucks Stakeholder Groups Starbucks stakeholders groups refer to persons, groups, or organization that has interest or concern in the company. The company’s stakeholders fall into three categories, which include primary stakeholders, secondary stakeholders, and public stakeholders (Bruhn-Hansen, 2012, p. 19). They specifically entail the shareholders who invented in the company’s shares, customers who purchase the company’s products and employees who work for the company across the world. The stakeholders also include the suppliers who provide raw materials to the company and farmers who produce coffee and benefit from the comprehensive programs that the company initiates to help farmers. Recently, families residing within the Silver Spring, Maryland community with children aged five and under became stakeholders. Governments and government agencies in countries where the Starbucks Company operates are also stakeholders in the company (Bruhn-Hansen, 2012, p. 19). Moreover, non-governmental organizations, which partner with Starbucks Company like Conservation International and Ecologic Enterprise Ventures are also stakeholders of the company. Additionally, all the communities that benefit from the company’s corporate social responsibility are stakeholders of Starbucks Company. Ultimately, franchisees that purchase the right to use the company’s trademarks, related brands, and proprietary knowledge for purposes of opening branches across the world also form part of Starbucks stakeholders. Starbucks Key Competitors Starbucks has close competitors in specialty coffee shops, doughnut shops, and quick service restaurants. Indeed, the completion comes from different sectors across the world thus demeaning the company’s market share. Caribou Coffee, which is specialty coffeehouse with 415 stores in the US, is one of the closest competitors of Starbucks Company. Second Cup which is a Canadian franchiser dealing in coffee is also a significant competitor alongside Java Centrale. Another major competitor is the privately owned Dunkin Donuts, which has about 5,000 stores in the U.S dealing with both doughnuts and coffee. Nestle S.A, which is a Swiss multinational food and Beverage Company and the largest food company in the world in terms of revenues offers great competition to Starbucks market share. Additionally we also have Darden Restaurants, Inc., which are a multi-brand restaurant operator and Yum! Brands, Inc., Another worthy competitor is the McDonald, which is actually the world’s largest fast-food chain restaurant (Mourdoukoutas, 2013, p. 1). McDonalds sells its products at a relatively lower price than Starbucks Company thus offering price competition. Indeed, since its upgrade in 2006, McDonalds is becoming an emerging competitor. More so, Panera’s Bread, which offers ambiance of casual dining, is also a competitor of Starbucks Company. Starbucks Company Current Strategy Starbucks adopts various strategies that constitute the overall strategy. Indeed, the company has a corporate social responsibility strategy that guides the operations of the company across the world as it seeks to achieve its mission via corporate social responsibility. Some of the activities in this strategy include the formulation of the Starbucks Foundation, which enhances literacy levels among children by building schools for them (Starbucks 2001, p. 1). This promotes their future by fostering hope among the children and involving their parents in the company. The company aims at being accountable to all stakeholders including the community by making social investments in the countries where it operates. For example, the company collaborates with CARE to build hospitals, schools, and coffee factories for purposes of enhancing the social lives of the immediate societies (Starbucks Corporation, 2013, p. 1). Indeed, this derives immense benefits to such communities. At the same time, the company adopts a strategy that offers credit services to coffee farmers at their countries of origin thus improving their social and economic lives (Starbucks, 2001, p.1). Additionally, the company seeks to incorporate an environmental strategy where it seeks to minimize environmental impact by offering recycling services in all its coffee shops and participating in the Global Month of Service where it volunteers in improving the environment (Starbucks 2001, p.1). In addition, Starbucks recognizes the input of the Green Team to reduce waste and conserve energy. Moreover, the company adopts an environmental mission statement that advocates for improved fuel efficiency in the vehicles that Starbucks owns and operates. Furthermore, Starbucks marketing strategy defined the way western companies market their products. The marketing strategy involves right market segmentation where Starbucks opt to compete on comfort rather than convenience in the upper-scale of the coffee market (Mourdoukoutas, 2013, p. 1). This makes Starbucks the most comfortable and valuable coffee shop in the world. The marketing strategy also involves execution where the company emphasis on its original, high quality coffee, quality customer service, and relaxing environment (Mourdoukoutas, 2013, p. 1). This defines Starbucks Company. The strategy also incorporates superb leadership from the company’s founder who advocates for innovation in the production of the company’s products, which derives uniqueness in the company (Mourdoukoutas, 2013, p. 1). The marketing strategy equally involves expansion to china where extended families live in small house thus the need for Starbucks as a “third place” (Mourdoukoutas, 2013, p. 1). This strategy has led to the market expansion of Starbuck market presence. The company also uses social media marketing where it adopts a social media strategy that incorporates Starbucks’ website and other social platforms that promote the marketing of the company’s products (Alliradiuk, 2013, p. 1). The company also involves adaptation and innovation in its strategy where it uses My Starbucks Idea website to support the company’s business crowding. This has indeed recorded immense success for the company. The uniqueness of its marketing strategy manifests clearly in the restaurants industry. The company focuses on the perfect cup of coffee strategy that advocates for the best quality of coffee. Indeed, even though Starbucks coffee is costly compared to its competitors, the company enjoys huge customer base due to the rich, aroma, and delicious taste of its coffee, which define the perfect cup of coffee strategy. The company emphasizes on customer satisfaction where all the company operations seek to derive comfort, relaxation, and uniqueness, which defines the Starbucks coffee experience. Indeed, the enjoyment of the Starbucks coffee experience derives a competitive advantage for the company. The company also focuses on brand marketing where it emphasizes on “word-of-mouth” and the uniqueness of its products in marketing Starbucks Corporation, 2013, p. 1). Actually, customers pass the Starbucks coffee experience to potential customers through personal interactions. Starbucks seeks smart partnerships to reinforce its business strategy (Starbucks 2001, p. 1). These partnerships account for the massive success that the company enjoys. The company seeks to create a Starbucks community around its brand where it encourages customers to express their expectations, experiences, comments, and recommendations. This ensures that the company responds to the customer’s needs thus maintaining their market share. However, the strategy of creating a third place which offers comfort, relaxation, and a nice experience remains the strongest aspect that makes Starbucks the largest coffee retailer, roaster, and brand of specialty coffee all over the globe amidst stiff completion in the industry. Conclusions I conclude that despite immense competition in the restaurant and specialty coffee industry, Starbucks is still the largest coffee retailer, roaster, and brand of specialty coffee in the world. Notably, the Starbucks experience stands out as the fundamental aspect that attracts and retains customers in the coffee shops. Moreover, the company’s strategy of producing high quality, aromatic, and delicious coffee defines the uniqueness of the company’s products. The Starbucks’ overall strategy defines how the company carries out its operations across all its branches. The company’s strategy incorporates corporate social responsibility, environmental conservation, customer satisfaction, innovation, market expansion, brand marketing, smart partnerships, market segmentation, quality leadership, and quality production. The overall strategy for the company has been effective in achieving its mission, which is “to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time. Nevertheless, the increasing market competition may require frequent review and adjustment of the company’s strategy to ensure that Starbucks Company maintains and improves its market share in this industry. Recommendations Subject to the effectiveness of the company’s overall strategy, I will propose very few recommendations. However, I would recommend that Starbucks Company focus on emerging markets since its wide network would give the company a competitive advantage in new markets. I would also propose that the company focuses on new products since its original products like coffee and doughnuts are facing immense competition from established companies like McDonalds. Indeed, this will help the company to maintain its market share and compensate the losses accrued from the competition. At the same time, the emphasis on the “word-of-mouth” advertising that the company adopts may not be effective in the increasing competitive market. As such, Starbuck should consider venturing in international broadcasting and print media advertisement to present its product to a wider audience. Moreover, the company should consider cultural diversity in its production to accommodate the values and tastes of everybody across the world. Works Cited Alliradiuk 2013, ‘An Excellent Marketing Strategy: Starbucks’, 2013, viewed 10 August 2013, < http://blogs.ubc.ca/aradiuk/2013/02/25/an-excellent-marketing-strategy-starbucks/> Bruhn-Hansen, S 2012, ‘Corporate Social Responsibility’, 2012, viewed 10 August 2013, < http://pure.au.dk/portal-asb-student/files/45282206/BA_Thesis.pdf> Mourdoukoutas, P 2013, ‘Starbucks and McDonald's Winning Strategy’, Forbes, 2013, viewed 10 August 2013, Starbucks 2001, ‘CSR Fiscal 2001 Report’, 2001, viewed 10 August 2013, < http://www.starbucks.com/assets/6ee14301a2364729abe59867fb913520.pdf> Starbucks Corporation 2013, ‘Being a Responsible Company’, 2013, viewed 10 August 2013, < http://www.starbucks.com/responsibility> Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“INTRODUCTION TO BUSINESS AND MANAGEMENT Essay Example | Topics and Well Written Essays - 1500 words”, n.d.)
INTRODUCTION TO BUSINESS AND MANAGEMENT Essay Example | Topics and Well Written Essays - 1500 words. Retrieved from https://studentshare.org/business/1484210-introduction-to-business-and-management
(INTRODUCTION TO BUSINESS AND MANAGEMENT Essay Example | Topics and Well Written Essays - 1500 Words)
INTRODUCTION TO BUSINESS AND MANAGEMENT Essay Example | Topics and Well Written Essays - 1500 Words. https://studentshare.org/business/1484210-introduction-to-business-and-management.
“INTRODUCTION TO BUSINESS AND MANAGEMENT Essay Example | Topics and Well Written Essays - 1500 Words”, n.d. https://studentshare.org/business/1484210-introduction-to-business-and-management.
  • Cited: 0 times

CHECK THESE SAMPLES OF Analysis of Starbucks Coffee Company's Current Strategy

Segmentation and Targeting

Schultz strategy was to create a personal association between customers and coffee.... Identify the company's target market and positioning strategy The level of coffee consumption in the United States has been on a downward trend, especially in the late twentieth century.... The concentrated strategy focuses its efforts on a single market section and develops and maintains an exclusive approach for every section.... The undistinguished strategy on the other targets the whole market using a single (Kotler & Armstrong, 2004)....
3 Pages (750 words) Essay

Marketing and Performance Analysis of Starbucks

The paper "Marketing and Performance analysis of starbucks" states that Starbucks does have certain weaknesses and threats.... starbucks coffee Company opened its very first outlet in Market Place, Seattle's Pike.... From the time when it was established in 1971, the company has shown a significantly increasing growth trend which indicates its outstanding performance and enhanced satisfaction level of starbucks' customers (Charles W.... According to its current performance and market share of the coffee industry, these threats and challenges are not significant enough to affect its performance and operations....
7 Pages (1750 words) Case Study

Foreign Market Entry and Its Implication

Market entry According to Albaum and Duerr (2011), market strategy comprises of an entry mode and a marketing plan.... Each strategy comes with differing degrees of advantages, disadvantages, risks and legal obligations (Gilligan & Hird 1986).... According to Albaum and Duerr (2011), the entry strategy to be adopted should take into consideration company objectives and expectations in terms of volume of business to be gained.... The strategy should also take into consideration resources required to effectively implement the strategy and patterns of involvement in other regions....
10 Pages (2500 words) Essay

COMPANY STRATEGIC ANALYSIS- Starbuck

starbucks coffee is the leading coffee shop globally.... starbucks coffee is the most competitive company in the coffee shop industry.... The study arrived to the conclusion that starbucks coffee is continuing to be the most competitive coffee company, however, since there are some competitors in the industry, Starbucks still needs the aid of Michael Porter's five forces, generic studies and cost leadership in order to stay on the top in the retail industryCompany Background Starbucks, the coffee company, is the perfect example of a product that could have gone the route of a shallow brand....
12 Pages (3000 words) Essay

How to Improve the Customer Service at Starbucks

The researcher of this descriptive essay mostly focuses on the discussion of the topic of customer service and analyzing the issue on the example of starbucks coffee company.... The author of this essay assumes that the starbucks coffee company grew from a small, regional business into the undisputed leader in the coffee industry by purchasing the best quality of coffee with facilitating an unmatched store experience.... The author unveils such interesting topic as Starbuck's retail strategy and makes a conclusion in the end of paper....
11 Pages (2750 words) Research Proposal

Starbucks Related to Pacific NorthWest

This report, therefore, will be attempting to determine the most appropriate strategy for Starbucks to apply in this area, between the pricing and quality strategy, in efforts to retain its huge customer base during hard economic times (Kotelnikov 1).... The Pricing strategy: Starbucks needs to adjust its prices downwards as trends have shown that the company's coffee is more price-elastic as compared to coffee demand, which is more elastic, as compared to the demand for other beverages....
9 Pages (2250 words) Case Study

Starbucks Financial and Business Analysis

The chain of starbucks is widespread and it is located in almost 60 countries in the world.... The increase in intense competition is also the factor that is resulting in shutting down of operations of starbucks in U.... Lastly, the paper provides a Pro forma for Starbucks to start its operations in India. Starbucks Corporation starting off from 1971 is the world's largest coffee With peculiar recognition and deliverance, the corporation is settled with 19000 coffee stores all over the world (Bussing-Burks, 2009)....
17 Pages (4250 words) Essay

Brand Identity of Starbucks

The company… Initially, the store was named as ‘starbucks coffee, Tea and Spices' and the brand logo depicted a chocolate brown colored two tailed mermaid.... In the year 2010, the company's profit margin had hit hard during recession but the company immediately regained profits by 12.... Later, the name of the Starbucks was initially formed with the motto of selling good coffee with a unique flavor that a regular coffee brand wouldn't offer....
6 Pages (1500 words) Essay
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us