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 world. Starbucks sells whole bean

coffee, a variety of cold blended beverages, freshly brewed coffee, premium teas, various food

and pastry items, beverage related equipment and accessories, as well as a line of CDs.

The growth and success of Starbucks

Starbucks owns nearly one-third of America’s coffee bars. Almost all of Starbucks’

locations in North America are