Marketing Strategy Case Starbucks

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					                   Starbucks: A Trend in Action

           A Case Study of the Starbucks Coffee Company




                             Presenters:

                         Chris Abplanalp
                           Keri Reilley
                           Mark Bigler
                         Owen Laracuente




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                             Table of Contents


CUSTOMER AND MARKETING STRATEGIES:                            3

TARGET MARKETS:                                               3

CUSTOMER SERVICE:                                             5

WORKS SITED                                                   8




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                            Starbucks: A Trend in Action

Customer and Marketing Strategies:

       Starbucks is very successful with drawing customers into the stores; the

marketing strategy is simple, offer high quality products and a great atmosphere, that will

draw consumers in. The founders of Starbucks realized that the public would be willing

to pay a premium price for a premium product. Starbucks is a customer friendly firm;

this is where the top notch reputation came from. A reputation that Starbucks must

flawlessly maintain, if this is not maintained Starbucks takes the risk of possibly loosing

part of their overwhelming share of the market.

       Starbucks’ atmosphere and quality is the major marketing strategy that Starbucks

employs. The ability of Starbucks to make the public feel as if they are right at home in

their own living room has been a huge success. This strategy is apparently working,

there are very few television and radio advertisements for Starbucks coffee, it does well

selling itself. Consumers feel right at home to be with friends, to socialize in a

comfortable atmosphere, this is what brings back customers again and again. Starbucks

has also done a very good job of branding and making mind space. So when a consumer

wants coffee or thinks about going out to a buy a cup of coffee, what is the first thing that

probably comes to the consumer’s mind: Starbucks.



Target Markets:

       Starbucks is a large corporation; with a lot of offer a diverse group of people.

They don’t only offer coffee like many people might think. Starbucks has an outstanding

reputation; they don’t cater to one group over the other. They like to say that they serve



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a very diverse group of people. Many of the large Starbucks are located in big cities,

which would be a reason why the crowd is so diverse. Everyone knows the brand name

Starbucks coffee has. Some people won’t drink anything but Starbucks coffee. This

makes for brand loyalty, which would occur when you have the same people coming in

all the time and buying your product.

       Since Starbucks franchises are so well known for the best coffee many people go

there. Most Starbucks are located in big cities, shopping malls, or out in the open where

there is a lot going on. Business people might go there before work to get coffee instead

of making it at their home. They don’t just offer coffee; they also offer a social aspect.

They have comfortable furniture, and up to date books and magazines. It could be a

place for people to go and just hang out. It’s not only for business people, or even the

working class. Students could go there for a place to go hang out or a quiet place to

study. Everyone knows that coffee is an essential to a college student especially when

they are studying. It could be the perfect atmosphere to get things done.

       Barne’s and Noble are also associated with Starbucks coffee now. They sell

Starbucks coffee in their bookstores. There is a little place to sit and read while you drink

your coffee. It is a good marketing strategy to keep people in the bookstore for a longer

period of time. This might also be exposure to the Starbucks brand that people didn’t

know about before. Barne’s and Noble have their own crowd that come in and read

every day and now they might also drink Starbucks coffee everyday. Also, some college

campuses have Starbucks coffee. If the students drink it on campus they could start

wanting to drink only Starbucks coffee, then the company starts to get more business.




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       There isn’t one specific target market that Starbucks attracts. What they sell is

something that a very diverse group of people can share. There are different target

markets that are associated with the company but there aren’t any specific kinds of people

they are looking to attract in the store. They have a very prestige’s image so they might

attract people who are looking for “the name,” but no more than a person walking down

the street and going in the store.



Customer Service:

       Starbucks is the leader in coffee shop retailing. They have accomplished this

through superb products and priding themselves on customer service. By creating

positive customer service, Starbucks has created a large base of loyal customers. Mr.

Schultz, owner of Starbucks stated, “We aren’t in the coffee business, serving people.

We are in the people business serving coffee.”(Fortune) Directly alongside product

quality is customer satisfaction. Starbucks wants to encourage purpose, commitment, and

enthusiasm among employees. Starbucks has found that in order to accomplish this, they

must have the best front line workers.

       Creating strong customer service begins with the employee. If the employee does

not take pride in his/her work, it will be reflected in their service to the customer. One of

Starbucks key concepts is, “employees should be fully versed in how to make

them[drinks] and how to market them[drinks] as well. They should be able to describe

contents and, especially if it’s part of the job description, spell the item correctly on a

chalkboard or a menu.”(Nation’s Restaurant News) To keep bad service at a minimum,

Starbucks has implemented many concepts for their employees. To start with every




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employee must attend twenty four hours of training, broken into six classes. This is done

in an effort to stop bad habits and prevent foul-ups on the front line. Once completed, the

employee is given a position on the front line making drinks. (Business Media)

Starbucks wish is for employees to learn before actually working, so they won’t be

learning at the customers’ expense. While this might seem intense for a person making

coffee, it does come with many benefits.

       Starbucks employees are not called employees, rather partners. This gives

employees a sense that what they do truly makes a difference in the company. To help

with this, employees who work at least twenty hours a week are offered stock options and

health-care benefits. By owning stock in the company you’re working for, almost all

employees will strive to make the company better because they know the stock will rise

resulting in more money for the stockholders. Also employees are encouraged to make

their own rational decisions when dealing with customer problems. Starbucks likes to see

the employee fix the problem instead of running to the manager for assistance. Some

people might be apprehensive to this, but “Starbucks wants you to use your best

judgment to create satisfied customers, and it [Starbucks] will stand behind the decision

you make.”(Business Media) By giving front line employees this control, the employees

feel more like their own manager instead of just a “worker bee.” The employees’

positive attitude is reflected on their work and relationships with customers.

       Starbucks wants employees and customers to interact on a personal level. In

some stores, when a regular customer pulls up, they begin making the drink and have it

ready by the time the customer has parked and reached the counter. This goes a long way

in customer satisfaction. Also by being knowledgeable, employees can point customers




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in the direction of the perfect coffee. If the product desired is not exactly on the menu, it

will be altered to the customers’ preference. These concepts would not be attainable if

the employees didn’t truly love their job. Also by knowing the entire menu inside and

out, drinks can be produced at a very fast rate leaving customers standing for a short time.

This also helps with lines in the morning when everyone wants coffee before work. By

creating a positive atmosphere, customers are immediately drawn in. Schultz stated,

“It’s [Starbucks] a place to feel comfort. A place to feel safe. A place to feel like you

belong.” He goes on to say when speaking of a foreign café he experienced, “It was on

extension of people’s front porch. It was an emotional experience.”(Fortune) Schultz

wanted this feeling in his own stores and through proper employee training; he has

accomplished a high level of comfort with customers.




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                                    Works Sited

Filipczak, Bob. “Training.” Business Media (1995): 73.

Lockyer, Sarah. “Full Steam Ahead: Starbucks Plans Strategies to Keep Growth
      Percolating.” Nation’s Restaurant News (2004): 4.

Serwer, Andy. “Hot Starbucks to Go.” Fortune (2004): 60 – 64.




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