...analysis of coffee market. The purpose of this paper is to study the supply and demand mechanism through the case analysis of Starbucks in coffee market. This paper has three main sections. The first two section states the problems in coffee market and its ramifications. The first main problem is that Starbucks being the price maker in the oligopolistic coffee retail market, Starbucks exerts its market power to set its coffee retail price much higher than other coffee sellers. The second problem facing by the coffee retail market is unsteady supply of coffee beans. The third section states the proposed solution to the above two problems. Possible solutions for the first problem include introducing more sellers into the market, branding and product differentiation campaign by other coffee sellers and government intervention. Possible solutions for the second problem include backward integration and product diversification. Case Analysis Problem Definition 1 – Oligopolist Exerts Market Power over Prices Starbucks buys coffee beans at low prices but sells the coffee in retail market at relatively higher prices than other coffee retail sellers. This is what described as “buy low sell high” (Keat; Young, P. 61). Starbucks is able to buy low because of coffee beans prices goes down as a result of overproduction of coffee beans in 2000-2003. Starbucks is able to sell high because of its market position in coffee retail market as being an oligopolist. Starbucks being an...
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... Favorite Brand Paper Branding is more than just a company logo. When a person thinks about a company they should think about great service, great products and great prices. My favorite brand is Starbucks, because of their ability to stand out in every aspect of branding. Effective branding can give a company the edge needed in a competitive market. Branding tells your customers what kind of company you are and what they can expect from your products and service. In my opinion Starbucks has the best tasting coffee drinks. I also appreciate the fact that Starbucks offers free Wi-Fi in a comfortable atmosphere where I can work on homework. Starbucks is also good to their employees by offering tuition reimbursement and fair wages. The Reasons I am Passionate about the Starbucks Brand I have been a Starbucks customer ever since I can remember. The first reason I am passionate about Starbucks is because of the quality of their products. I love the taste of their coffee, teas, and food products. They also have a large variety of drinks available so a person never gets tired of the same thing. The second reason I am passionate about Starbucks is because of their customer service. I always receive fast and friendly service at Starbucks. The final reason I am passionate about Starbucks is because of their rewards program. The Starbucks reward program is designed to reward loyal customers for their purchases. The...
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...SWOT Analysis Starbucks Donnie Walker Mgmt 303 Starbucks SWOT Analysis Starbucks is a specialty coffeehouse chain that was started in 1971 in Seattle Washington. In 1982, Howard Schultz joined Starbucks, merging the Italian coffee shop culture with the pre-existing Seattle store. The coffee culture soared allowing for expansion of more Starbucks locations throughout the United States to develop during the 1990’s. Starbucks popularity allowed it to become the first publicly traded company. Starbucks continues to expand and currently has more than 15,500 locations in more than 43 countries. Starbucks mission statement is to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time (www.starbucks.com). One of the core strengths Starbucks possesses is its employee management and treatment. Starbucks employees are offered excellent benefits and pay. Starbucks offers a total pay packages called “your special blend”. This package includes: bonuses, 401(k) matching and discounted stock purchase options, adoption assistance and health coverage. Starbucks will help reduce out-of-pocket expenses for education. Very few companies are competitive with their pay and benefits package in this day. Starbucks is the exception and was ranked one of the top 100 companies to work for several years in a row. The appealing employment through Starbucks means less turn around for the company and more profit. Yet another core strength...
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...STARBUCKS BRANDING STRATEGY Presented By: Tanveer Ahmad Beigh Roll. No. 217 MBA The Business School Starbucks Corp., the world’s biggest coffee retailer, unveiled a new logo that drops the words, "Starbucks" and the "Coffee" , from their well-known green coloring encircling the iconic sea nymph at its centre. This is the fourth version of the logo since the company's beginnings as a small coffee shop in Seattle in 1971. Those prior versions of the logo helped build Starbucks into one of the world's best-recognized brands, and the company now feels it no longer needs to reinforce its name at every turn. Starbucks plans to bring the logo to stores in March on its 40th anniversary. No sooner the plans of the company to alter its logo have been announced, there has been a lot of ballyhoo on the various media regarding this change. The main reason for removing the company name from the logo is, according to Schultz (CEO of Starbucks), to free the mermaid – this is supposed to represent the firm’s ability to free themselves from the coffee market. The name ‘Starbucks coffee’ confines the market of the company to drinks and thus limits their growth potential. Let us consider the benefits of this branding strategy by Starbucks. As the change in the branding is the removal its verbal part, it removes a language barrier. Starbucks started...
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...Brand Management Brand Value Chain - The below diagram is a typical model of brand value chain. It follows the process of developing a brand. There are two lines in this model, first line shows the various stages of developing the value of company and the second line consists of the multipliers which strengthen the relationship between the stages. Generally there are four value stages and three multipliers in a brand value chain model but for explaining the case of Starbucks we have excluded the fourth stage and the subsequent multiplier. Marketing Program Investor Customer Mind-set Market Performance Marketplace Conditions Multiplier Program Quality Multiplier Value Stages Multipliers * Product * Location * Advertising * Employee * Clarity * Distinctiveness * Relevance * Consistency * Price Premiums * Price Elastics * Market Share * Expansion Success * Cost Structure * Profitability * Awareness * Attitude * Association * Attachment * Activity * Competitive Reactions * Channel Support * Customer Size & Profile Marketing Program Investor Customer Mind-set Market Performance Marketplace Conditions Multiplier Program Quality Multiplier Value Stages Multipliers * Product * Location * Advertising * Employee * Clarity * Distinctiveness * Relevance * Consistency * Price Premiums * Price Elastics * Market Share *...
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...In this assignment I will be comparing both Apple and Starbucks to find out how marketing techniques are used to market products. I will include an Ansoff’s Matrix, survival strategies, branding and relationship marketing. Marketing – is the process in which the producers of goods and services focus on satisfying the needs of the consumers. Also marketing is the social process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others. Growth Strategies – is a strategy aimed at winning larger market share, even at the expense of short term earnings. These consist of 4 broad growth strategies: * Product Development – is the creation of products with new or different characteristics that offer new or additional benefits to the customer. For example Apple updates their iconic iPhone by adding additional features like a bigger screen or a better camera. Starbucks also use product development, for example, when Starbucks released their ice frappes it only came out in one flavour, vanilla, but now they have made it better by adding different flavours like chocolate and Strawberry. But some stores in America do a bubble gum flavour for children. * Market Development – is a marketing technique aimed at increasing a company’s market in order to widen the customer base for the purpose of selling more products. For example Apple used to only sell in the USA because that’s where they were founded but now they have...
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...Strategic Organization of Starbucks Founded in Seattle Washington’s Pike Place Market in 1971, Starbucks has positioned itself to be the long contending leader of coffee. In fact, their very mission is to “inspire and nurture the human spirit – one person, one cup and one neighborhood at a time.” At first blush, it would seem as though Starbucks is taking a congenial approach towards being a brand that one can count on. To the contrary, congeniality did not make Starbucks the juggernaut of a company, coffee or otherwise, that they are today. Starbucks domination of the market is a direct result of their prowess to provide a great product all the while capitalizing on a product many Americans depend on daily. In fact, according to a competitor “Coffee is the second most consumed beverage on the planet after water. It’s the second most traded commodity after oil. People at work and home drink coffee all day, every day in almost every country around the world”. To that end, it is no wonder why Starbucks aggressively markets its product. Starbucks has single-handedly revolutionized the way in which America, and the world over, consumes, buys, and even orders its coffee. Upon closer review, one will notice that each and every decision Starbucks makes is a calculated effort to garner more and more of the market share. First we will examine Starbuck’s marketing strategy. Starbucks has forgone the conventional style of marketing. Instead it has relied on word of mouth its quality product...
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...Consumer Culture Theory, Consumer Agency and the Importance of Brands Summary of the Importance and Relevance of Topic Consumer Culture Theory (CCT) refers to the classification of a certain approach to studying consumers and the way that they consume. It was first coined in 2005 by Arnould and Thompson, and it specifically addresses the sociocultural, symbolic, experiential and ideological facets of consumption. Their work is the culmination of over a quarter century of research that treats consumer behaviour as a phenomenon worth studying. As we have come to develop the field of CCT, so too are we developing our understanding of the consumer, and the broader economy. The work of Arnould and Thompson has provided students of consumer behaviour with the necessary environment to debate, innovate and advance the field of study.1 CCT is important within the scope of consumer behaviour because it places a focus on meaning and identity creation; it delves deeper in the mentality that surrounds consumers in the marketplace, and an understanding of this mentality is useful to all that engage the market (buyers, sellers, producers, etc...). “CCT explores how consumers actively rework and transform symbolic meanings encodes in ads, brands, retail settings, or material goods to manifest their particular personal and social circumstances and lifestyle goals.”2 In understanding CCT, we understand the market in a broad sense, for example, acknowledging that marketing symbols are significant...
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...With the best position in the coffee shop industry in North America especial in America with 11,962 stores which kept increasing from 2011 (Statista , 2014). Starbucks is proving that it is a master of using model marketing, specifically in term of consumer behavior, and to establish their position in customer mind. Since the first coffee shop of Starbucks was settled down in Seattle, America in 1971 by English teacher Jerry Baldwin, history teacher Zev Siegl, and writer Gordon Bowker. It had been 43 years which is a long time to create a brand loyalty, a brand awareness, brand image for Starbucks which becomes a national brand, “In fiscal 2013, Starbucks had more than 3 billion customer visits to our more than 19,000 stores in 62 countries” (Starbucks, 2013). The truth about Starbucks have paid a lot of money to do research on international consumer behavior are paid off with a thousand of franchise stores have been spread out the world. In business perspective, Starbucks can be called a master of Marketing, and why that term is made up for Starbucks. In this project, our group would like to figure out the best marketing strategy of Starbucks based on the consumer behavior aspect which are in store environment element, product line extension, image of company, customer service, staffs’ communication way, using customers’ ego such as environment friendly, and sponsorship for local community. Store Environment When consumer think about Starbucks, the first mage which comes...
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...Case Study : Starbucks- Going Global Fast. Question 1 Identify the controllable and uncontrollable elements that Starbucks has encountered in entering global markets. Answer: Starbucks have encountered various controllable elements while going global. Controllable elements in marketing is the 4Ps – Product, Pricing, Promotion and Place. Starbucks have localised product for different regions where Starbucks have expand its business to. Localised product means products are created to suit the taste and culture of a particular country or region. Example in the case study, Starbucks developed espresso and latte which is less sweet than US counterparts to match with Asian taste. Starbucks in Asian region also serves green tea latte to suit Asian habits of drinking tea, especially green tea. The next controllable element Starbucks encountered is the pricing factor. Since Starbucks is going global, Starbucks have to have a good pricing strategy to suit every market. Pricing strategy can be in various forms like bundle pricing or discounts and rebates. Pricing also determine the target customer of the business. Starbucks in this case does not compromise on the price. Starbucks are adopting high end pricing rather than competitive pricing. Starbucks is confident that the coffee they serve will certainly worth the price customers pay for. Therefore Starbucks never lower the price as doing so will reduce its brand value. Instead Starbucks continue with the same price and serve...
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...Starbucks in Cambodia Introduction Globalization, a process of international integration from the interchange of world views, products, ideas and cultures which can benefit all countries that embrace international trade. With the right strategy to involve in international trade, a country can successfully grow economically, as well as socially. Cambodia is a country located at the central of Southeast Asia, with population of over 14.8 million people. With an open investment policy, Cambodia offers opportunities for creative entrepreneurs and dynamic businesses. It is evident through her rapid development and strong, positive growth over the last 15 years. It provides opportunities for foreign investment. In this paper, we will discuss the global coffee company-Starbucks Corporation and its potential expansion into Cambodian market. Starbucks Corporation is an American global coffee company and coffeehouse chain based in Seattle, Washington. Starbucks has developed an internationalization strategy to enable the company to open stores and franchises in countries across the globe. They provide unique tasting products and have improvised the recipe of traditional coffee according to modern tastes. While Starbucks was very successful in its domestic market, the leaders of the company sees the potential of foreign markets and planned to expand its business to foreign countries through globalization in order to fully utilize the potential that the company had. In 2003, Starbucks...
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...[pic] INTRODUCTION TO BUSINESS PROCESSES (BUSI 1333) [pic] ASSESSMENT GUIDE 2012-13 NB The assessment details contained in this document are the definitive details of your assessment for this course 2012-13. Please follow this guide and disregard information on assessment from any other document. Contents Page |Recommended texts |2 | |Course schedule |3-4 | |Assessment 1 |5-6 | |Assessment 2 |7-14 | |Generic Assessment criteria level 1 |15-16 | Recommended Course Texts: |Blythe, J. |2009 |Essentials of Marketing / 4E (4th Ed) |Pearson Education ltd | | | |E BOOK |978-0-273-7173-2 | |Slack, Johnson & |2011 |Essentials of Operations Management |Pearson Education ltd | |Brandon-Jones | |E BOOK |978-0-273-75242-4 | Course Schedule ...
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...Defining Marketing William Bice MKT/421 17 April 2014 Michael Bishop Marketing Defined Marketing plays a significant role in any successful business endeavor. Marketing is the way a business introduces products and services to potential customers. This introduction is the beginning or sustainment of the businesses relationship with its customers. The most powerful and successful marketing strategies can even have an effect on social behavior and attitudes. Effective marketing strategies often instill a feeling that somehow the target audience will be better off, or have a better life if they would just go out and purchase their product. Additionally some marketing strategies can instill a feeling perhaps guilt in would be customer that they are somehow missing out, or may not be the best person they can be unless they purchase the product. Shoes for example may imply an improvement in a customer’s athleticism. Or perhaps a pain reliever will work better than the rest. Maybe one of the most common marketing strategies is the promise of lower prices. According to “The American Marketing Association” (2013), marketing is defined as “the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large” (Definitions). The “Merriam Webster” (n.d.) website defines Marketing as “Activities that direct the flow of goods and services from producers to...
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...A) Type of business strategy: Tim Horton’s: Low-Cost Provider Strategy Broad Differentiation Strategy Starbucks: The Focused Differentiation Strategy Best-Cost Provider Strategy B) MVV Statements Tim Horton’s • Mission: “[Their] guiding mission is to deliver superior quality products and services for [their] guests and communities through leadership, innovation, and partnerships.” • Vision: ‘[Their] vision is to be the quality leader in everything [they] do.” • Values: “At Tim Horton’s we are making a true difference for individuals, communities and the planet, everyday” “Tim Horton’s is proud to support local community initiatives that make a difference.” For example, o Free swimming/skating; timbits minor sports; community clean ups; earn-a-bike program; smile cookie program; The Tim Horton Children’s Foundation. o Sponsorships; National Sponsorships; Environmental Stewardship; Aboriginal Relations; Animal Welfare; Tim Horton’s Coffee Partnership. Starbucks: • Mission: “To inspire and nurture the human spirit – one person, one cup and one neighbourhood at a time.” • Vision: Starbucks vision is “to establish Starbucks as the premier purveyor of the finest coffee in the world while maintaining our uncompromising principles while we grow.” • Values: “Starbucks Shared Planet is [their] commitment to doing business responsibly. Working to promote a better way of helping each other and the planet – by inspiring [their] customers and partners...
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...less satisfied with the services offered by Starbucks. People are getting the perception that Starbucks only cares about “making money” and “opening more stores”. To increase overall customer satisfaction, Ms. Day proposes that Starbucks invests $40 million to increase the labor of every Starbucks store. After careful analysis, we recommend that Ms. Day focus the investment on high traffic stores that are in need of improvement in the speed of service. Stores with low customers’ satisfaction scores should also get more focus than those with high satisfaction score. Additionally, part time workers should also be hired specifically for peak hour periods. On top of the $40 million investment, we would recommend that Starbucks hire a chief marketing officer in order to create synergy between the three marketing groups within Starbucks. Corporate should also re-train store managers in order to improve their soft skills. The managers will also be able to communicate the message of “customer first” to other “partners” in the store so that they can work on delivering good brand experience to the customers. Lastly, special promotion such as free cup after certain number of visits will create additional value for the customers. All of the above recommendations are for the sole purpose of addressing the decline in customer satisfaction at Starbucks. Market Analysis The outlook for the U.S. retail coffee market is extremely positive. Coffee consumption is on the rise in the United States...
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