STARBUCKS
Natural Tea Blend Frappuccino
Chih-jen Shiau
Jeroen Verleum
Robert Jan van Leijden
Pei-chia Hsu
Seon Hoo Kim
Young Eun Kang
Situation Objectives Strategy Action Plan
Table of Contents
SITUATIONAL ANALYSIS
MARKETING OBJECTIVES
MARKETING STRATEGY
MONITORING AND CONTROL
CONTINGENCY PLAN
INTRODUCTION
&
SITUATION ANALYSIS
Situation Objectives Strategy Action Plan
Introduction to STARBUCKS
• World’s leading retailer for purchasing, roasting and selling
whole bean coffees and specialty coffee.
• Starbucks Coffee Company was founded in 1971. It opened its
first store in Seattle’s Pike Place Market
• 8500 retail locations across 32 countries worldwide.
(statistics as of May 2005)
• The company is headquartered in Seattle, Washington and
employs about 74,000 people.
• The company recorded revenues of $5294.2 million during the
fiscal year ended
Situation Objectives Strategy Action Plan
CEO Howard Schultz
The man who made Starbucks the number
one specialty coffee brand.
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Starbucks Mission Statement
Provide a great work environment and treat each
other with respect and dignity.
Embrace diversity as an essential component in the
way we do business.
Apply the highest standards of excellence to the
purchasing, roasting and fresh delivery of our
coffee.
Develop enthusiastically satisfied customers all of
the time.
Contribute positively to our communities and our
environment.
Recognize that profitability is essential to our future
success.
Situation Objectives Strategy Action Plan
Customers
• A Starbucks Coffee house has approximately 33 million
customers each week
• They see Starbucks as a second home
• They enjoy the “Starbucks Experience”
• Age of 15 - 45
Product and Company
• offering the finest coffee worldwide and maintaining their
principles while they grow. They see Starbucks as a
second home
• Mainly sell specialty coffee (Arabica coffee)
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STARBUCKS’ Products
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STARBUCKS’ Products
Coffee Beverage
Whole Bean coffees
Food items
coffee related items
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STARBUCKS’ Products
1984
Italian Style
Drop coffee Espresso
Caffè Latte
Cappuccino
Barista
Non fat milk, soy based products,
Confectionary, ice cream
Frappuccino
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Powerful Symbol for Positive Planetary Change
Color of STARBUCKS
Situation Objectives Strategy Action Plan
Competitors
The Coffee Bean,
Krispy Kreme + Dunkin’ Donuts.
Small local coffeehouses,
supermarkets,
Jamba Juice,
Orange Julius
Fast food chains such as McDonald’s and Burger King
Channel
Starbucks Coffee stores – retail
Supermarkets – for canned products
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MARKETING OBJECTIVES
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Sales, revenue and profit goals:
Sales goal: 256.76 million units total
Revenue goal: 950 million dollars
Profit goal: 149.1 million dollars
Increase share of Frappuccino in total Starbucks sales and revenues
Driven by opening more stores in US, marketing and adding a new
customer group
Larger profits due to increased sales
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Customer goals:
“Develop enthusiastically satisfied customers all of the time.”
Expand the market to tea consumers
Give tea the image that it is healthy
Increase the consumer acceptance of tea products at Starbucks
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MARKETING STRATEGY
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Overall Strategy:
• Two additional beverages on the Natural Tea Blend
• Synergy effect from the star product: Green Tea Frappuccino
• For non coffee drinkers
• Seeking more healthy alternatives to coffee
6 months, 5 million dollars
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STP
Psychographic:
lifestyle: health conscious people who seek non-coffee
beverages
Target
Prestige, high quality
“Starbucks experience” (surroundings)
Location convenience
Positioning
Health appeal but at the same time delicious
With highest quality possible. Premium specialty tea
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Product
Natural tea blend
green tea, chamomile tea, jasmine tea
“Starbucks experience”
Product
Tall: $3.20 grande: $3.70 venti: $4.20
At the average of $3.70
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Place
You can always find a Starbucks on the corner:
numerous retail stores provides convenience
Promotion
main advertisement:
websites (ex. yahoo and google)
in store sample testing.
others: magazines
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On websites:
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Promotion : Advertisement
Jasmine Chamomile
Health Starbucks
Frappuccino Tea Blend
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EXECUTING & MONITORING
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Allocation of marketing investment
• We allocate the marketing investment budget, which is 5 million
dollar, as follows:
• Advertising costs are 3.5 million:
– Website: 1.75 million (50%)
– Testing: 1.05 million (30%)
– Magazine: 0.7 million (20%)
• R&D costs are 0.5 million.
• Marketing research costs are 1 million.
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Marketing Budget
Break even point (BEP) for the Frappuccino line
Sales: 191.74 million units.
Revenue: 709.43 million dollars
Return on marketing investment (ROMI)
ROMI = 2.594 times (259.4%)
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Methods of monitoring
Sales check (by monthly)
Customer Survey (post-purchase)
MONTH
Tasks
Nov Dec Jan Feb Mar April May June July
Finalization of plan
and corporate
communication
Product Development
Product testing
Focus groups
Segment test (monitor)
Contact advertising
agency
Plan promotion plans
Design distribution
strategy
Employee training
Finalization period
Launch product
Monitor and check
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