Starbucks is a global coffee powerhouse that has had a success record that nearly any company would die for. It has never undertaken much a traditional route in regards to marketing and advertising. Starbucks specialty is using word of mouth, tribal, and viral social formats to promote its products and services. It is recommended in the wake of global populist movements that Starbucks further refine its CSR initiatives internally, and then use this to leverage new consumer segments. If Starbucks takes this approach it will position itself to be more sustainable in terms of the triple bottom line in the wake of a shift in public consciousness.
The coffee retail industry is one of the most multifaceted industries possible. This industry generally relies on the reliance on marketing to drive sales. Marketing undoubtedly isn’t restricted to just advertising, and one of the primary responsibilities of marketing is to keep pace with the ever evolving set of consumer preferences. Consumer preferences can either be consist of individuals existing preferences or the inherent predisposition by which preferences can be trained. For example, one opportunity for marketers is to build demand by teaching the consumer to appreciate the characteristics of any particular product they are trying to sell. In this manner marketing campaigns can train a consumer to demand a product. Thus teaching consumers to appreciate the differences provide by product differentiation can serve a major role in building a loyal consumer base.
There are many barriers that prevent other firms from competing with Starbucks on the global coffee market. One example would include the issues related to developing economies of scale. When new firms enter the market they will have to contend with the competition in regards to the product prices and production costs. Starbuck has established a well-managed global supply chain that can deliver excellent coffee to fifty million customers in fifty one countries each and every week (Cooke, 2010). Starbucks has industrialized its supply chain so systematically that it serves as an exemplary system for other firms in different industries to try to aspire to (Locke, 2011). Thus for any entrant to attempt to compete on the scale in which Starbucks does it would take either an enormous investment in capital which few other firms are even capable of.
Any new entrant would have to be at least fairly price competitive. Therefore they would either have to build comparable quantities of scales or accept a reduced margin. Starbucks comprehensive supply chain would most probably mean that any potential competitor would have higher production costs for raw materials with would result in a disadvantage. Such disadvantages would not only affect the supply chain costs but they would subsequently affect production, marketing, research and development and many other business functions. Basically, any firm wishing to try to compete with Starbucks on a global scale would have to try to develop a market from a significantly disadvantage position.
The only potential competition for Starbucks would be limited to local markets or markets that Starbucks has not entered. For example, in some markets local coffee shops may have a certain home territory advantage that Starbucks might find it difficult to break through. Having to compete with this level of localism would require high levels of customization and thus would be difficult for Starbucks compete on that level. Starbucks must operate on a more standardized model so that there is only flexibility to make only moderate changes to suite local markets. However competitors within local markets are generally highly fragmented and relatively unorganized. Therefore they do not necessarily pose any type of significant threat to Starbucks on a global level.
Starbucks target markets are positioned mostly in proximity to their retail locations. These locations are consequently chosen by areas that are likely to have significant numbers of consumers who have above average disposable incomes. There are often Starbucks that are positioned around office centers which attract repeat clientele given their proximity to the coffee chain. Malls are another popular target market for Starbucks as shoppers generally stop at a retail outlet or sometime a Starbucks kiosk to recharge while they are fatigued from walking around. In some locations there is drive through Starbucks however most have large lounges that can serve as their target markets “third place.” In the big box stores where Starbucks competes directly against lower priced brands the target market is often the same as the retail location. Starbucks focuses on customers who prefer a premium grade coffee and also has sufficient disposable income to purchase such luxury items.
4 P. Analyses
Starbucks sells gourmet coffee through its retail stores as well as many related items such as pastries and coffee accessories such as mugs and thermoses. The organization also has an ecommerce product line in which can be directly mailed to any individual customers. There are customer loyalty items as well as gift cards that work to support the online aspects of the business. Furthermore, they have also introduced a line of coffee meant for residential use that is distributed through the retail stores as well as many big box chains.
Product differentiation is closely related to brand identification and brand equity which represents a focal point for Starbucks product mix. To differentiate their products they have made substantial investments and provided immense amounts of capital over the course of time to establish a level of customer loyalty that is unlikely to be replicated by any other firm. Brand identification is a result of costly advertising and customer service over time that makes consumers loyal to one brand (Conway, 2011). Starbuck product mix and branding efforts have been successful which is evident by their record of tremendous growth throughout the years.
Starbucks, since its inception, has always followed the concept of complete ownership of branding, processes, and control over all of its retail spaces. This has allowed them a significant amount of control over issues such as quality and their customer service experience. However, when the global economy fell into a recession, Starbucks was profoundly obstructed due to the fact that its products represent a luxury good to most customers. As a result Starbucks was forced to close many corporate owned retail locations (Jargon, 2010).
Location may be one of the most fundamental pieces of the equation for retail premium coffee shops. As opposed to being loyal to any one brand, it is reasonable to believe that location may be one of the most significant factors that from the consumer perspective. It is unlikely that the quality of coffee would bring anyone to venture a crossed town to purchase a single cup of coffee. Generally consumers will just go for the best option that happens to be in there immediate environment. Though there may be a small portion of the consumer base that would be willing to go the extra length to get a cup of coffee from their favorite brand, this segment is most probably fairly low.
Price is most likely one of the least significant variables that a consumer will consider when purchasing coffee. Even premium coffee most likely does not account for a large portion of a typical consumer’s disposable income in their target market. As long as Starbucks is at least in the ballpark in regards to the prices that they charge for the various coffees that it offers then it is unlikely that premium coffee drinkers will use price as their primary basis for any purchase decisions. However, during the global recession it was reported that may people would forego premium coffee altogether and replace it with homebrewed coffee or lower cost alternatives such as the coffee brands that are found at fast-food franchises or at convenience stores. Therefore even though consumers might not necessarily price shop for premium coffee brands at the retail locations, under some circumstances they will find substitute products that are in different price niches. The products sold through big box stores might fall under a different model however. These products are in competition to products that are available in the same isle in the supermarket locations. Thus proximity has some effects since Starbucks charges a price premium.
Starbucks coffee has had a long history of creative promotions. However, there marketing campaigns are generally unconventional. It is very rare to ever see a Starbucks billboard advertisement, magazine or newspaper ad, or even a poster (Kembell, 2002). Instead of a more traditional path, Starbucks chooses to use predominantly social network channels to promote its products. It relies heavily on word of mouth advertising. Starbucks works to create tribal communities that can use Starbucks retail locations as a “third space” to meet at or just to hang out and relax (Moore, 2006). Therefore these strategies often work to make Starbucks go viral in the communities or locations in which it develops retail locations. From the success of the retail spaces, the other products also benefit from this approach as the brand loyalty has already been built.
One trend that was identified that has worked to define a new point in history is the rise of populist movements worldwide. First it was the Arab Spring, then Occupy Wall Street, and the massive protest throughout the U.K (BBC News, 2011). These populist uprisings have reached record heights and numbers that haven’t been seen in over a half a decade or in some countries much longer. As a result of these populist movements, it seems that a significant portion of the public consciousness has shifted towards are more collectivist position which will have significant consequences on business into the future. Many of these populists’ movements had an underlying theme by the protested organized and stated their contempt for corporations and corporate greed.
As a result of a shifting social conscious, it is reasonable to believe that corporations should work swiftly to fine tune their corporate social responsibility (CSR) capabilities and messages. It is reasonable to believe that since the public consciousness has shifted that an increasing number of consumers will be investigating the corporate business processes and activities to try to find out information about how the organization operates behind the scenes.
Coffee also represents a sensitive industry in many consumer segments because much of the production of the coffee beans is done in developing countries. In these agricultural-based countries labor is incredibly cheap and the coffee farmers live at sub-substance levels in many cases. Starbucks has already has acquired some bad publicity in regards to the lack of social responsibility that it has shown towards many of its partners in the downstream supply chain (Reynolds, 2010). Despite various failures in social responsibility, Starbucks has developed an incredibly well established stance on social responsibility that was enacted after previous transgressions were made public (Starbucks Coffee, 2011).
Therefore, given the new trends and public consciousness and the increasing salience of CSR demands from consumers and other corporations and coupled with the fact that the competition has a well-developed program already in place; Starbucks should work quickly to promote its dedication to social and environmental sustainability. CSR practices have been based on a framework of creating sustainable production methods as well as supply chains that treat people ethically as well as place ecology as one of the most imperative considerations in the process. Negative publicity associated with lack of corporate responsibility has brought major corporations to the verge of bankruptcy in recent years. Scandals such as Nike and Martha Stewart are two examples among a number of examples.
Additionally, Starbucks can actually add value to your products and further differentiate them through CSR marketing campaigns. However, the catch to this is that your CSR messages have to be deemed credible by the consumer. Generally it is the case that consumers are skeptical of CSR promoting marketing messages unless it is a “good fit” (Jahdi & Acikdilli, 2009). A good fit is defined as a marketing strategy that is identified as reliable and credible by the customers. Furthermore organizations that are don’t fit the criteria in terms of credibility could actually result in a counterproductive impact on the target market in regards to a CSR message. Instead of adding value, it might be regarded as more of a public relations trick than to be deemed as an authentic dedication to social or environmental causes.
Therefore it is recommended in light of the changing political landscape that have emerged recently, that Starbucks take another look at their CSR stance. If they find that their organization stands room for improvement then they should rectify there questionable practices as soon as possible. Starbucks should also consider implementing more social and environmentally oriented projects in the areas in which its supply chain operates. Thus they should go beyond a reactive approach to CSR and try to be proactive in their dedication to these issues. Not only will this improve the supply chain, but it will also stand to add value amongst consumers.
Starbucks has had a long history of using creative marketing techniques to further its business objectives. It is rare to see Starbucks engaged in any form of marketing that could be considered traditional. However, it seems that much of the social fabric has changed and may be reaching new levels of ethical scrutiny of corporate activities. Starbucks has had a mixed history in regards to CSR. It should examine its operations to ensure that there are no ethical transgressions whatsoever. Then it should be more proactive in the areas in which the supply chain operates by creating projects that tackle certain environmental or social causes. Finally, once the organization has ensured its CSR position internally, it should leverage this in new marketing campaigns to add value to consumers.
BBC News, 2011. Time unveils Person of the Year: The Protester. [Online]
Available at: http://www.bbc.co.uk/news/world-us-canada-16184196
[Accessed 20 December 2011].
Conway, M., 2011. Brand Loyalty: Starbucks’ Die-Hard Customers. [Online]
Available at: http://prthoughts-marki.blogspot.com/2011/02/brand-loyalty-starbucks-die-hard.html
[Accessed 20 December 2011].
Cooke, J., 2010. From bean to cup: How Starbucks transformed its supply chain. [Online]
Available at: http://www.supplychainquarterly.com/topics/Procurement/scq201004starbucks/
[Accessed 20 December 2011].
Jahdi, K. & Acikdilli, G., 2009. Marketing Communications and Corporate Social Responsibility (CSR): Marriage of Coveinience or Shotgun Wedding?. Journal of Business Ethics, 88(1), pp. 103-113.
Jargon, J., 2010. For Starbucks, a New Retail Mix. [Online]
Available at: http://online.wsj.com/article/SB10001424052748704557704575437730148951528.html
[Accessed 21 December 2011].
Kembell, B., 2002. Starbucks Marketing Strategy Unconventionally Effective. [Online]
Available at: http://www.voteforus.com/starbucksmarketingstrategy.html
[Accessed 21 December 2011].
Locke, D., 2011. What Your Supply Chain Can Learn from Starbucks. [Online]
Available at: http://blog.sourcinginnovation.com/2011/04/13/what-your-supply-chain-can-learn-from-starbucks.aspx?ref=rss [Accessed 20 December 2011].
Moore, J., 2006. Tribal Knowledge. [Online]
Available at: http://tribalknowledge.biz/notes-updates/starbucks-mailbag-1/
[Accessed 20 December 2011].
Reynolds, J., 2010. Coffee chains fall short on social responsibility. [Online]
Available at: http://www.marketingmagazine.co.uk/News/MostEmailed/1007943/Coffee-chains-fall-short-social-responsibility / [Accessed 21 December 2011].
Starbucks Coffee, 2011. Being a Responsible Company. [Online]
Available at: http://www.starbucks.com/responsibility [Accessed 20 December 2011].
Get Professional Assignment Help Cheaply
Are you busy and do not have time to handle your assignment? Are you scared that your paper will not make the grade? Do you have responsibilities that may hinder you from turning in your assignment on time? Are you tired and can barely handle your assignment? Are your grades inconsistent?
Whichever your reason is, it is valid! You can get professional academic help from our service at affordable rates. We have a team of professional academic writers who can handle all your assignments.
Why Choose Our Academic Writing Service?
- Plagiarism free papers
- Timely delivery
- Any deadline
- Skilled, Experienced Native English Writers
- Subject-relevant academic writer
- Adherence to paper instructions
- Ability to tackle bulk assignments
- Reasonable prices
- 24/7 Customer Support
- Get superb grades consistently
Online Academic Help With Different Subjects
Students barely have time to read. We got you! Have your literature essay or book review written without having the hassle of reading the book. You can get your literature paper custom-written for you by our literature specialists.
Do you struggle with finance? No need to torture yourself if finance is not your cup of tea. You can order your finance paper from our academic writing service and get 100% original work from competent finance experts.
While psychology may be an interesting subject, you may lack sufficient time to handle your assignments. Don’t despair; by using our academic writing service, you can be assured of perfect grades. Moreover, your grades will be consistent.
Engineering is quite a demanding subject. Students face a lot of pressure and barely have enough time to do what they love to do. Our academic writing service got you covered! Our engineering specialists follow the paper instructions and ensure timely delivery of the paper.
In the nursing course, you may have difficulties with literature reviews, annotated bibliographies, critical essays, and other assignments. Our nursing assignment writers will offer you professional nursing paper help at low prices.
Truth be told, sociology papers can be quite exhausting. Our academic writing service relieves you of fatigue, pressure, and stress. You can relax and have peace of mind as our academic writers handle your sociology assignment.
We take pride in having some of the best business writers in the industry. Our business writers have a lot of experience in the field. They are reliable, and you can be assured of a high-grade paper. They are able to handle business papers of any subject, length, deadline, and difficulty!
We boast of having some of the most experienced statistics experts in the industry. Our statistics experts have diverse skills, expertise, and knowledge to handle any kind of assignment. They have access to all kinds of software to get your assignment done.
Writing a law essay may prove to be an insurmountable obstacle, especially when you need to know the peculiarities of the legislative framework. Take advantage of our top-notch law specialists and get superb grades and 100% satisfaction.
What discipline/subjects do you deal in?
We have highlighted some of the most popular subjects we handle above. Those are just a tip of the iceberg. We deal in all academic disciplines since our writers are as diverse. They have been drawn from across all disciplines, and orders are assigned to those writers believed to be the best in the field. In a nutshell, there is no task we cannot handle; all you need to do is place your order with us. As long as your instructions are clear, just trust we shall deliver irrespective of the discipline.
Are your writers competent enough to handle my paper?
Our essay writers are graduates with bachelor's, masters, Ph.D., and doctorate degrees in various subjects. The minimum requirement to be an essay writer with our essay writing service is to have a college degree. All our academic writers have a minimum of two years of academic writing. We have a stringent recruitment process to ensure that we get only the most competent essay writers in the industry. We also ensure that the writers are handsomely compensated for their value. The majority of our writers are native English speakers. As such, the fluency of language and grammar is impeccable.
What if I don’t like the paper?
There is a very low likelihood that you won’t like the paper.
- When assigning your order, we match the paper’s discipline with the writer’s field/specialization. Since all our writers are graduates, we match the paper’s subject with the field the writer studied. For instance, if it’s a nursing paper, only a nursing graduate and writer will handle it. Furthermore, all our writers have academic writing experience and top-notch research skills.
- We have a quality assurance that reviews the paper before it gets to you. As such, we ensure that you get a paper that meets the required standard and will most definitely make the grade.
In the event that you don’t like your paper:
- The writer will revise the paper up to your pleasing. You have unlimited revisions. You simply need to highlight what specifically you don’t like about the paper, and the writer will make the amendments. The paper will be revised until you are satisfied. Revisions are free of charge
- We will have a different writer write the paper from scratch.
- Last resort, if the above does not work, we will refund your money.
Will the professor find out I didn’t write the paper myself?
Not at all. All papers are written from scratch. There is no way your tutor or instructor will realize that you did not write the paper yourself. In fact, we recommend using our assignment help services for consistent results.
What if the paper is plagiarized?
We check all papers for plagiarism before we submit them. We use powerful plagiarism checking software such as SafeAssign, LopesWrite, and Turnitin. We also upload the plagiarism report so that you can review it. We understand that plagiarism is academic suicide. We would not take the risk of submitting plagiarized work and jeopardize your academic journey. Furthermore, we do not sell or use prewritten papers, and each paper is written from scratch.
When will I get my paper?
You determine when you get the paper by setting the deadline when placing the order. All papers are delivered within the deadline. We are well aware that we operate in a time-sensitive industry. As such, we have laid out strategies to ensure that the client receives the paper on time and they never miss the deadline. We understand that papers that are submitted late have some points deducted. We do not want you to miss any points due to late submission. We work on beating deadlines by huge margins in order to ensure that you have ample time to review the paper before you submit it.
Will anyone find out that I used your services?
We have a privacy and confidentiality policy that guides our work. We NEVER share any customer information with third parties. Noone will ever know that you used our assignment help services. It’s only between you and us. We are bound by our policies to protect the customer’s identity and information. All your information, such as your names, phone number, email, order information, and so on, are protected. We have robust security systems that ensure that your data is protected. Hacking our systems is close to impossible, and it has never happened.
How our Assignment Help Service Works
1. Place an order
You fill all the paper instructions in the order form. Make sure you include all the helpful materials so that our academic writers can deliver the perfect paper. It will also help to eliminate unnecessary revisions.
2. Pay for the order
Proceed to pay for the paper so that it can be assigned to one of our expert academic writers. The paper subject is matched with the writer’s area of specialization.
3. Track the progress
You communicate with the writer and know about the progress of the paper. The client can ask the writer for drafts of the paper. The client can upload extra material and include additional instructions from the lecturer. Receive a paper.
4. Download the paper
The paper is sent to your email and uploaded to your personal account. You also get a plagiarism report attached to your paper.
PLACE THIS ORDER OR A SIMILAR ORDER WITH US TODAY AND GET A PERFECT SCORE!!!