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					Ted Levitt famously said "A product is not a product unless it sells. Otherwise it is merely a museum
piece". These words ring true to any marketing manager when trying to decide the best way to market
and promote a product to consumers. Harvard Business professor Neil Borden identified a number of
company activities that can influence a buyer. Any company should be able to prepare its own long list.
Borden suggested that all those activities constitute a "marketing mix" and should be planned in concert
for maximum impact. Professor Jerome McCarthy further defined the marketing mix as consisting of
The Four P's: product, price, place and promotion. The four P framework calls upon marketers to decide
on the product and its characteristics, set the price, decide how to distribute the product and choose
methods for promoting the product.

Product: The basis of any business is a product or offering the consumers wish to purchase. A company
aims to make the product or offering different and better in some way that will cause the target market
to favor it and even pay a price premium.
Price: Price differs from the other three marketing mix elements in that it produces revenue; the other
elements create costs. Consequently companies work hard to lift their prices as high as their level of
differentiation will support.
Place: Every seller must decide how to make its good available to the target market. If the product can
not reach consumers in the market place it does not matter how good of a product or service is that is
offered. Distribution clearly poses a number of challenges. A company must recognize that their
distribution choices establish a fairly long commitment that they may have to live with even when and
more attractive channels appear.
Promotion: Promotion covers all those communications tools that can deliver a message to a target
audience. Some of the tools involved include: advertising, sales promotion, public relations, sales force
and direct marketing.

Starbucks coffee has closely examined the four P's and implemented them to become the largest coffee
restaurant in the world. They constantly strive to meet or exceed customer expectations and take
customer feedback very seriously.

Starbucks is best known for one product: extremely good coffee. This is their core product and they
have refined their business model to give the consumer the best cup of coffee possible. If a customer is
not 100% satisfied Starbucks will give the customer a new cup at no additional charge. One of the more
interesting trends with Starbucks is that they are now allowing customers log on to their web site or use
a mobile phone application to build custom drinks and then bring in the recipe to have the barista
prepare the drink. Recently Starbucks announced it was getting out of the breakfast sandwich business
and concentrating on their core product: coffee. After careful consideration it was determined that by
eliminating the breakfast sandwiches food cost could be reduced considerably since the sandwiches had
to be discarded after a certain amount of shelf life, where as unused coffee could be resealed and
reused. One of the more interesting aspects of the decision to remove breakfast sandwiches was that
CEO Howard Schultz did not like the breakfast sandwich smell competing with the roasted coffee aroma
that Starbucks was best known for. Again this goes back to having a core product that company is center
Starbucks has achieved the highest price point for coffee in the restaurant industry. They are conveying
a since superior product to the consumer by giving the consumer a consistent high quality beverage.
Other competitors have entered into competition with Starbucks including McDonald's with their
McCafe brand and Dunkin Donuts with their Dunkachino offerings. Starbucks has countered this by
trying to appeal to customers who previously would not consider spending $3.75 for a basic coffee drink
by introducing their new $1 coffee item. By doing this Starbucks is aiming at opening up a whole new
segment of the breakfast market that in the past had excluded many price conscious consumers.

Starbucks has strategically located its retail locations (place) to achieve maximum daily visits from
consumers and to engrain into consumers that if they want coffee that Starbucks is where they would
want to purchase it. Several ways that they have achieved this is by opening on college campus through
out the country, through licensing agreements with Barnes and Noble so they instantly developed over
700 new locations with out having to spend money on development costs and lastly they are willing to
pay top dollar for irreplaceable real estate. As the average customer of Starbucks is typically in a hurry to
get their coffee on the way to somewhere else it is interesting that Starbuck's mobile application will tell
the consumer where the closest Starbucks is, whether it is a walk up or drive through location and store

Finally Starbucks is an expert at promoting their product and services. The green sign has become
synonymous with the company. The company is striving to make Starbucks "the third place" that
consumers go when they are not at home or at the office thus creating a unique and relaxing
"experience" and "atmosphere" for people has been very important for the company as they have
realized that this is one of the strongest concepts attached to the company, to which customers have
been strongly attracted. Starbucks has sought technology to promote their brand by building their own
mobile phone application as previously discussed which allows consumers to use messaging to systems
to encourage meeting at a Starbucks location for social encounters as well as a meeting place for
business people to conduct work meetings. It is interesting that Starbucks chose mobile phone
development as a tactical marketing strategy. The brilliance is that Starbucks realizes that most
consumers have their phones with them all the time and Starbucks can "push" information to
consumers rather than spending money on commercials that people are most likely to see after they
have arrived at their residence and unlikely to leave. Furthermore commercials tend to be broad and are
so short the individuals hardly have enough time to absorb the information being broadcast. This type of
viral marketing be it mobile applications or social networking sites such as FaceBook where once
consumers become fans Starbucks can send daily notices to constantly stimulate a consumers desire to
visit the store has been a huge success for the company. One potential backlash that Starbucks is facing
is that they do charge for their WIFI access. This could turn away some consumers who feel that they
should be entitled to free WIFI access if they spend money in the store. Starbucks counter to this is that
they don't want people coming to the locations and using the WIFI access that Starbucks is paying for
and not purchasing a product. A compromise that has been suggested is that Starbucks print out a code
on each receipt that customers can use while in the store to gain WIFI access. The code would expire
after 24 hours. Starbucks has also started issuing loyalty cards to customers so that after a certain
number of purchases the consumer gets a free product. This promotes visits as the consumer has a goal
in sight.

From only one store more than 30 years ago in Seattle to its still growing empire today with thousands
of outlets in the United States and in foreign countries, the Starbucks Coffee Company is no doubt a
well-known success story all over the world. Every business can learn from another, especially if a
particular business is one that has displayed tremendous success over the years. The Starbucks
Corporation and its successful marketing strategies are definitely something that anyone interested in
business can learn about. When a marketing manager is planning out a product's selling points they
generally think of them from a seller's point of view. A true marketing manager should also consider the
reciprocal for each the four P's which are known as the four C's or the Consumer's Point of view. Those
include: Customer Value, Cost to the Customer, Convenience and Communication. By taking a global
view of the product from both the producer and consumer side the marketing manager will have a great
chance for superior product development and deployment.

Reference: Kotler on Marketing, Philip Kotler, 1999
Reference: - for annual shareholder statements

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