...Innovation is the process whereby organizations use skills and resources to either develop new goods and services or introduce new production and operating systems to respond to the changing needs of customers (Jones, 2010). Much of Starbuck’s success hinges on incremental innovations (Jones, 2010). The company has one ear firmly planted on technological ground and has harassed incremental technological change (Jones, 2010). From a digital perspective, the Starbucks Digital Network (SDN) offers new, localized, and valuable content from the biggest names in news and entertainment. The SDN offers free subscriptions to The Economist, Wall Street Journal, for example. Brotman (Chief Digital Officer) states that SDN coupled with world class mobile platforms and the company’s in-house Wi-Fi strategy offers customers an experience second to none (Kanani, 2012). The company pays heed to customer preferences. For years Starbucks has maintained that dark roasts are much better than light rendering the business with the formidable task of convincing internal and external audiences that its lighter roast “Blonde” stood up to the company’s high standards. R&D revealed through the consumer research “sensory preference” map that 40% of U.S. coffee drinkers prefer lighter blends and dark roast drinkers fall within a small area on this map Starbucks seized the opportunity because it recognized a huge long-term growth prospect (Gertner, 2012). The company pays particular attention to its...
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...Globalization Starbucks is a global company. Globalization affects the four functions of management in many ways. Being that it is a global company there must be more use of the functions. It must be done on a larger scale than with a smaller company. The different sites have to communicate on the plans of action. It could affect the functions negatively , in that there are so many sites that need to be considered when planning. It could be hard to get all of the management team onboard at the same time., Technology Starbucks has always been on top of it in regards to technology. They are one of the first coffee places to offer free wi-fi. They are known for being an upscale coffee spot. This is where technology comes into play. Starbucks has to be on top of the technology scene being that they are a worldwide company. The functions can be affected by this fact. For the company to stay as successful as it is, they need to stay up to date with the latest technology. If it has the most up to date technology then it can interact with the stores with efficiency. Innovation Innovation parallels with technology. If the management team at starbucks is trying to get more innovative. They need to make sure they have younger management teams. The younger generations are able to think “outside of the box”. The younger generation is more up to date on the new technologies that are coming out. They have graduated recently so they know what the younger people are interested in. This...
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...Starbucks Company Learning Team A ECO365 Principles of Microeconomics University of Phoenix February 6, 2012. Prof. Carlos Mendez Starbucks Company Named after the first mate in Herman Melville’s Moby Dick, in 1971 the first Starbucks opens in Seattle. At the beginning we just wanted to be a small store, a retailer of whole and ground bean coffee, tea and spices. With a mission, to inspire and nurture the human spirit-one person one cup and one neighborhood at a time. The integration of Howard Schultz in 1982, as director of retail operations and marketing brought new ideas and products. In 1983 Howard travelled to Italy and was impressed with the espresso bar in Milan. He then convinced the founders of Starbucks to try the coffeehouse approach and the first Starbucks® Caffé Latte was served. By the 1990 a total of 84 stores were opened in the United States. In 1998 the Starbucks brand coffee could be found in supermarkets or in one of the 2,498 stores. Not only was the company growing but the ideas and new products had an impact worldwide. In 2001 with 4,709 stores opened an ethical coffee sourcing guidelines where implemented and on 2006 with 15, 011 stores the first paper beverage...
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...INTERNATIONAL UNIVERSITY COLLEGE Sofia PESTEL ANALYSIS FOR STARBUCKS COFFEE COMPANY Coursework in Business Environment Statement of originality We, the undersigned, declare that this coursework is our own original work. Student registration No: 101033 Signature: …………. 101047 Signature: …………. Program: Business Administration, Level 1 Lecturer: Prof. M. Malinowska The subject that we are going to focus on in the course work is a PESTEL Analysis on Starbucks Coffee Company. This analysis is aimed to familiarize the readers with the six types of factors that influence the activity of such a large and prosperous company as Starbucks. As we all know every business has its ups and downs but by taking into consideration what the influences are, better service and production could be achieved. The emphasis of this project is to discuss the major characteristics of a whole business and providing information about the way it functions. We will also talk about the reflection of Starbucks on the society all over the world. POLITICAL FACTORS Starbucks was established in Seattle, Washington, USA on March, 30, 1971. This is the largest coffeehouse in the world. Since the opening of the first Starbucks store, 30 years ago it becomes more and more popular. Till today Starbucks Co. owns 17,009 stores in 55 countries, which makes it one of the most popular places for a coffee drink. The following...
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... | |Starbucks Annual Report 2012-13 Assignment | | | |6/7/2013 | | | INTRODUCTION Executive Summary What was once a small coffee shop opened by Gerald Baldwin, Gordon Bowker, and Ziev Siegl in 1971, Starbucks Coffee Company has grown into the number one specialty coffee retailer. With over 20,000 coffee shops in more than 60 countries, of which 7,200 are licensed and franchised and 10,000 are owned, the company’s main objective is to establish Starbucks as the “most recognized and respected brand in the world.” “SBUX.” Has for purchase and roast high-quality coffees that we sell, along with handcrafted coffee, tea and other beverages and a variety of fresh food items, through company-operated stores also a variety of coffee and tea products and license trademarks through channels such as Starbucks brand, portfolio also includes Tazo® Tea, Seattle’s Best Coffee®, Starbucks VIA® Ready Brew, Starbucks Refreshers™ Beverages, Evolution Fresh™, La Boulange bakery brand and the Verismo™ System by Starbucks. Their objective is to maintain Starbucks standing as one of the most recognized and respected brands in the world...
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...Abstract Starbucks is one of the world’s most powerful and recognizable brands. Since its creation in 1987, Starbucks has managed to revolutionize the coffeehouse industry by marketing expensive, high quality coffee. However, while the company faced significant growth in the early 2000s, Starbucks has recently started experiencing difficulties, as some of its stores face saturation both in the domestic and in the international market. The purpose of this paper is to analyze the reasons that have led to these problems; to identify the key factors that distinguish the company as an international giant, as well as to explore different options that could be undertaken in order for the company to further establish its position as a leader in the coffee industry. Introduction Starbucks is a Seattle based company that has grown to an international leader, operating in over 50 countries with 17,651 stores worldwide (Starbucks, 2012). Starbucks has been able to gain such a large share of the market by catering specifically to a well-defined target audience and by offering unique experience. The history of Starbucks and its expansion is a model for other businesses to look up to. 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 without a doubt a well-known success story all over the...
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...products or marketing programs. Starbucks uses socio-economic segmentation in consumer markets, concentrating on social classes. 1. Young urban adults, particularly the business class population who works in offices and wants to have a cup of coffee with a good atmosphere and facilities, are the main segment it focuses on. According to Howard Schultz, Chairman of Starbucks, this segment is what the company refers to as its “core customers”, educated, average age of 42, and average income of $90,000. (The New York Times, 2006). They are people of diverse income and age groups that possess varying tastes and interests. Starbucks focuses on embracing diversity by providing good customer service and also by offering a large base of products that cater to different appeals. They are willing and interested in trying new products and innovations and by primarily reaching this target segment; it would then be easier to persuade other age groups to try Starbucks’ products. 2. Teenagers like college students are not its target group as teenagers do not necessarily have the money and if they do, are not as willing to spend their money on a pricey cup of coffee. Although teenagers are a large segment, they do not fit in to the image that Starbucks is creating. In addition they are not high consumers of coffee products and Starbucks does not advertise to the youth in general. 3. Middle aged to senior citizens is also not a good target segment for Starbucks. Senior citizens are inclined to...
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...Author: Group 2 Course: Operation Management SERVICE QUALITY IN STARBUCKS COFFEE An in-depth study ABSTRACT This report has been prepared to analyze the processes and strategies such as control of operations systems, design and planning of Starbucks. Theoretical frameworks have been applied to evaluate the company’s operational strategy in terms of its products and services offering. While the report considers Starbucks overall strategy, it also focuses on the daily operations of Starbucks franchises. The study evaluates how Starbucks has been able to position itself as a leader in its market segment and analyses the strengths and weakness in the company’s existing strategy. Upon dissecting various aspects of the company’s processes, it provides an appreciation of the company’s efforts to continuously evolve in the changing market conditions by incorporating new product design and being innovative to stay at parity with its competition. Finally, upon identifying the areas of improvement in the company’s existing strategy, the report conclusion discusses about lesson learned and possible recommendations that can be incorporated in order to further ensure operational efficiency thereby maximizing profits and increasing its value offering. Page 1 of 31 Table of Contents ACKNOWLEDGEMENT .............................................................Error! Bookmark not defined. ABSTRACT ..........................................................
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...Strategic Marketing Plan for the Starbucks Coffee Company Table of Contents Introduction and background 3 Company mission, company objectives 3 Market definition and product or brand background 4 Evaluation of results and conclusion about problem 5 Situational Analysis 5 Internal analysis 5 Customer analysis 7 Industry analysis 8 Competitor analysis 11 Distribution and supplier analysis 11 SWOT analysis – Confrontation Matrix 12 Choice of option 13 Marketing objectives/ expected results 13 Marketing strategy 13 Target audiences 14 Brand and product position 14 Decisions regarding marketing mix elements 15 Objectives for marketing mix elements 15 Strategies and tactics for marketing mix elements 15 Financial indicators and budges 16 Evaluation criteria 16 Sources 16 Introduction and background Company mission, company objectives The first Starbucks café was opened in 1971 in Seattle’s historic Pike Place Market. It was only a small café, but it offered some of the world’s finest fresh-roasted whole bean coffees. The company’s name derives from Moby Dick, the novel was written by the American author Herman Melville in 1851. Starbuck is the first mate on a whaling ship named ‘Pequod’, he is an intelligent Quaker (religious group) and he is from Nantucket. The name evoked the romance of the high seas and the seafaring tradition of the early coffee traders. Starbucks chairman, president and chief...
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...Starbucks Student Name Course Instructor Date Starbucks The Starbucks Corporation has enjoyed phenomenal growth since its early days in 1971 as a quaint coffee shop in Seattle, Washington. The rise of Starbucks can be directly attributed to the following factors; the emphasis placed on product quality, high employee standards, and creating the perfect cup of coffee (Coffee.org, 2013, pg.1). Starbucks has a reputation of caring about the community, environment, and people. “We aim to foster a better future for farmers and a more stable climate for the planet. Doing this helps create a long-term supply of the high-quality beans we’ve been carefully blending, roasting and packing fresh for more than forty years.” (Starbucks, 2013, pg.1). The company has a loyal customer base willing to pay premium prices for Starbucks products. Starbucks has strategically located its stores in the community, which is a competitive advantage. Starbucks is ahead of most competitors when it comes to financial strength and profitability. One of the strongest advantages of Starbucks they have years of experience delivering quality blended, premium coffee to its customers that are met with a warm atmosphere, which results in incomparable customer service. Starbucks products may be more expensive than those offered by the competition, however, their customer service, different brands of coffee and community connections offset. The customers of Starbucks have shared the experience as a community...
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...STARBUCKS QUESTIONS For Question 3, provide financial calculations to support your recommendation. I recognize that it is early days in the program so do your best to consider the numbers. 1) At the time of the case, why had Starbucks been so successful? Reasons; 1. With the public offering, raising $25 million. The proceeds allowed Starbucks to open more stores across the nation. 2. From a retail perspective, a successful branding strategy by creating an “experience” around the consumption of coffee. To enforce its exacting coffee standards, Starbuck; : controlled as much of the supply chain as possible in high-traffic, high-visibility settings such as retail centers, office buildings, and university campuses : worked directly with growers in various countries of origin to purchase green coffee beans, : oversaw the custom-roasting process for the company’s various blends and single-origin coffees : controlled distribution to retail stores around the world. : by creating an effective atmosphere and customer service, referred to as “customer intimacy” 2) Summarize the research presented in the case in terms of the key implications for Starbucks management. What concerns should they have about the results? 1. Sound financial records. Starbucks profitability has been rising for the past few years. 2. Starbucks has a strong brand reputation associated with quality coffee and excellent customer service. Its brand...
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...Certified Coffee which is designed by Transfair US. The purpose of this initiative is to ensure that farmers will get reasonable return on their crops and we can say suppliers are powerful today. But Starbucks has already made a long term contract with some of suppliers so supplier bargaining power will be less effective for Starbucks. In starbuck their bargaining power of suppliers is low because Starbuck already control as much of the supply chain as possible in market. Starbuck get highest-quality coffee in world, that sourced from the Africa, Central and South America and Asia- Pacific regions. It is because Starbuck have various suppliers so that they can negotiate with a reasonable price. Starbuck tak perlu resau tentang utk mdpt bekalan bahan mentah, jika salah satu supplier mereka tidak mau membekalkanya.ini adalah kerana starbuck mempunyai pilihan lainh utk suppy mereka bmentah. PROBLEMS Product innovation New products were launched on a regular basis for example, Starbucks introduced at least one new hot beverage every holiday season, but its seems not meet their customers satisfaction. Refer to Exhibit 10, customers that satisfied with new and innovation beverages only shows 2nd last lowest percentage that is 13%. Its shows that customers not interested with new product innovation. The new product development process generally operated on a 12 – to- 18 month cycle, during which the internal research and development ( R&D) team tinkered with product formulations, ran...
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...Starbucks management system Compared to other Australian coffee shops Alexey Andiev Starbucks Fail in Australia • MGT 210• 12 November 2012 Alexey Andiev • e-mail:alexeyandiev@gmail.com • American Business School of Paris 1 What makes Starbucks different from its competitors? 1) With two registers and a full staff, Starbucks can churn through 220 customers/hour. "From the moment a customer walks through the door, we want to get them through in 3 minutes," a longtime Starbucks manager tells us. "Or 3-5 minutes if it's busy." This statement represents that Starbucks is oriented towards efficiency. 2) The store claims to serve 87,000 different drink combinations, all of which a barista can make without hesitation. Baristas manage complex orders with the innovative Starbucks shorthand, or Beverage ID Code, which is written in marker on every cup. For example, a Double Chocolate Chip Light Frappuccino is DCCFL. Giving its clients variety of choice, Starbucks adds innovation to the coffe culture. 3) Starbucks baristas undergo over 30 hours of training on everything from Frappuccino technique to the origins of coffee beans. 4) Most stores have upgraded to the Swiss-made Mastrena, designed to make "the highest-quality, consistent shot of espresso that will be second to none". 5) Baristas who work at least 20 hours/week are eligible for health insurance. This could have something to do with the famously cheery demeanor of "partners". Of course this isn't cheap. In 2009 health...
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...Introduction Starbucks has evolved over the years into a retail giant, branching out into new areas and partnering with other giants to get their brand to the masses. There are several reasons why Starbucks is on top of their market, one being the meticulous attention they pay to details. Starbucks prides itself in providing the highest quality product with excellent customer service. Coffee beans were imported from all over the world and freshly roasted in shop. The premium coffee company has a loyal following of coffee and tea consumers imbibing something like a million drinks per week at its 16,000 stores worldwide. The stores were constructed to give the customer a unique and intimate experience upon every visit. The java giant has earned the title of the world's largest coffeehouse company. But Starbucks is also one of those companies people love to hate. Whether it's the issue of recyclable cups, Fair Trade coffees, labor rights, corporate social responsibility, predatory business tactics, or over-roasted coffee, there's no shortage of strong anti-Starbucks sentiments these days. The collected data was not only showing a lack of image and product differentiation between Starbucks’ products and other smaller coffee chains but also a discontent with customer service. The branding strategy followed by the coffee company had three main components. First was the coffee itself that was believed to be the highest-quality coffee in the world, sourced from Africa. The second...
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...international operations of Starbucks company. 1. Provide brief examples of strategies at the level of business unit implemented by this firm over last five years. Throughout the startup of Starbucks with the CEO, Shultz, the focus has always been on the people. The strongest strategy to surround himself with good people and not to compromise. This strong belief in his people and the promise of good benefits and stock programs, was a well calculated and well-reasoned business decision early on (www.umsl.edu). It was Shultz’s belief that it was better to give the employees a sense of loyalty so that they can train newcomers and become veterans who can train the next round of newcomers…thus saving the turnover that many of the fast restaurants and small shops experience. CEO Shultz’s belief to “Pour your heart into it…one cup at a time” brought in the introduction of lattes and cappuccinos. The business strategies for product branding and product differentiation, price competiveness, and offering the Starbucks store card that will allow for rewards for being a customer…all provided uniqueness and growth for the store. Increasing multiple stores in same communities created storefront advertising and brand awareness, while saving advertising costs elsewhere. Where most stores will segregate themselves from region to region, this strategy proved strong in putting the Starbucks presence around every corner. Core strengths carried on from earlier Starbucks business plans, were great...
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