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STARBUCKS COFFEE Presented by. Bandinee Pradhan 12DM023 Sec- A IMIS

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Page 1: Starbucks

STARBUCKS COFFEE

Presented by.

Bandinee Pradhan12DM023Sec- AIMIS

Page 2: Starbucks

About the Company

Established in 1971 at Seattle, Washington Famous for its quality fresh-roasted coffee beans and stylish atmosphere. Over 9,000 stores worldwide Product lines include :

− beverages (coffee, Tazo tea, soda, juices)− pastries− whole coffee beans− coffee-related hardware and equipment− merchandise (mug, CDs)

Page 3: Starbucks

Delivering Customer Service @ STARBUCKS

Howard Schultz’s idea with Starbucks in the mid 1980’s was to create a chain of coffeehouses with a product differentiation of specialty “live coffee”, service or customer intimacy with an “experience”, and an atmosphere of a “third place” to add to their work and home alternatives.

The original stores sold whole beans and premium-priced coffee beverages by the cup and catered primarily to affluent, well educated, white-collar patrons (skewed female) between the ages of 25 and 44.

Starbucks research indicated that customers did perceive many independent coffee houses as a “third place”, but Starbucks was seen more as a convenient, quick, and consistently good coffee provider. This is in contrast to the way Starbucks management viewed the company. By 2002, there were over 5,000 stores around the globe.

Page 4: Starbucks

Background & ProblemBaristas (employees) were encouraged to interact with customers in a friendly and prompt manner, and were paid higher than average wages and benefits. Employees were considered partners and promotions were usually from within the company.

While Starbucks was the largest specialty coffee chain, many other chains competed directly with Starbucks, and many other chains could at any time enter retail specialty coffee sales (e.g. Dunkin Donuts, convenience stores, and many similar retail food stores.

Baristas jobs were complicated by the fact that many products required numerous steps to complete the order. They had installed automated espresso machines in some stores for the customers use to reduce wait time. Introduced a prepaid card that could be used to pay for products in the stores.

Starbucks had no centralized marketing program. Sales data was accumulated, and it was the responsibility of management to request that specific data be analyzed.

Page 5: Starbucks

Alternatives & EvaluationsRedefine their marketing strategies starting with a proper research and evaluation of what the customer wants. Starbucks has lost track of the customer when their determination of what is served to the customer is determined by what makes the barista happy.

Create a centralized marketing department which can attempt to coordinate all marketing efforts. There appears to be a lack of harmony between collecting data and the proper evaluation of the data. The snapshot methodology they used may not reflect a universal measure of customer satisfaction.

Advertise more to establish the branding of Starbucks. Why is Starbucks different? While Starbucks may think they know what distinguishes Starbucks from others, they should do more research and develop a real strategy prior to initiating any major advertising campaign. They have developed over time, and their customers are different than before.

Page 6: Starbucks

Solution

Starbucks should pursue all of these alternatives

Starbucks appears to consider competition as minimal, and that they are somewhat insulated. Probably, entertaining either idea is a strategic mistake.

Page 7: Starbucks