Starbucks Corporation
Type
Starbucks Corporation is recognized as a public retailer and premier roaster of specialty coffee worldwide. It was founded in 1971 and it is headquartered in Seattle, Washington. The company purchases, roasts and sells high quality bean coffees along with Italian style espresso beverages, rich brewed coffee, cold blended beverages, selections of premier tea, and a variety of complementary food items. In addition, the company accredits its brand names via the chattel investors, authorities, and certified vending stores. The corporation has business divisions including the U.S.A., CPG and intercontinental.
Competition
The specialty coffee segment is huge and consequently competitive. Many investors enter the industry to get a portion of the profit. Starbucks is considerably stable given that it has operated and dominated the specialty coffee segment for years. The company appears to have an invariable aim for the fresh market competitors.
However, companies such as Folgers, Coca-Cola, Kraft Foods, and Pepsi are amongst the foodstuff and nourishment retail-power sources that offer substitute products. These companies spend millions in promotion only with the aim of overshadowing one another and appear improved. The vicious rivalry in the specialty-coffee retail segment benefits the consumer given that extra product lines continue to emerge at low prices.
Ownership
Starbucks Corporation is an express public retail business, a producer, and an exporter of specialty coffee. In fact, it is more of a wholesale stockpile besides being a publicly traded corporation. Initially, Starbucks was privately owned in the city of Seattle, which hosted the company’s center of operations and the roasting plant. Now, Starbucks is a publicly owned corporation.
Level of service /employees
The coffee drunk at Starbucks is inert but sweet. The employees convey the knowledge and fervor regarding specialty coffee. In order to improve the level of services offered, the employees undergo special training at Starbucks. The employees gain knowledge on the varieties and ways of making specialty coffee consumed at Starbucks. In most cases, the workers prepare coffee based on the customers’ needs. The preparation procedures take time but effectively increase the chances of boosting sales. However, it is not acceptable for the workers to prepare drinks containing milk that a consumer can carry to or from the store owing to health concerns. Service delivery becomes easy given the poke-yoke method that enables the customer to relay an order at the back of the espresso inn.
Product assortment
Starbucks product range depends on the customers’ quality requirements on coffee drinks. The fresh coffee drink has autonomous demand since the product has high precedence at Starbucks. Fresh coffee is perishable and only prepared on order. For freshness, the consumers would require hot coffee. Nevertheless, in order to set up ecological goals, Starbucks initiated double cupping and corrugated holders to evade hot-coffee finger burn problems. Conversely, the Pike-Place light roast coffee has recently helped the clients who hardly consume bitter coffee. This has improved the corporation’s sales despite controversially infuriating the coffee connoisseurs.
In contrast, the low-fat milk has the propensity of making an espresso drink taste watery. Thus, its preparation requires informed decision. The organic milk could come from cows lacking growth hormones instead of the pricey certified organic milk. Equally, the additions of syrup to a coffee drink help Starbucks in achieving the condition of flavored milk. The other product is cold coffee, which is a blended ice beverage initially readymade in California.
Pricing
Starbucks Corporation ensures that the prices of its products are flexible for its success. In order to illustrate this fact, Starbucks coffee products are currently the leading selling products offered at similar price to the inferior quality brands without altering quality. Starbucks products are differentiated to attract low costs, which reduces the prices charged for each coffee product. Hence, the prices are unmatched and affordable for various consumers. A particular variety of coffee product is offered in different sizes to ensure all classes of individuals can afford it.
Competitive advantage
Starbucks Corporation has competitive market strategies that help it to be strategically positioned in the international markets. The strategic approaches employed by this corporation are custom planned actions that fit the industry environment and its identifiable conditions. The company earns above average returns since it found the unique ways to differentiate and deliver superior products to its clients. Starbucks has appealing store ambiance, superior client services, flavorful coffee drinks and convenient locations that make it to stand out amongst other market competitors that sell coffee. Starbucks gained competitive advantage in the entire ready to drink coffee industry through these inimitable market strategies.
There are a number of untold coffee shops, which have tried to emulate the competitive strategy applied by Starbucks. However, not even a single coffee shop has managed to attain similar levels of market success. Through selecting the unique differentiation strategies to offer superior value to the clients while determined to attain operative excellence, Starbucks is able to achieve long-term brand-loyalty. This rather makes it very hard for other competing companies to succeed by just replicating Starbucks strategic international market approach.
Indeed, the strategies dubbed as “Me too” as applied by other corporations can hardly be anticipated to provide stellar performances and competitive advantage. However, if the copycats possess competencies and resources, which allow them to offer superior values to the clients as compared to other corporations offering similar value using identical international market strategic approaches, then they can achieve similar competitive advantage.
The pace at which Starbucks fared its market ascension materialized to be as incredible as the alterations the corporation designed in the customary brand marketing conception. The company is renowned to take the global oldest products and modify them into differentiated, value laden and lasting brands. Besides, most Starbucks products are differentiated to attract low costs, which further offer a source of potential and sustainable competitive advantage to the company.
At the international markets, the low cost of producing the unmatched differentiated products makes Starbucks to overcome the external environmental changes. The differentiated products are difficult to replicate given that they are of unusual positive brand image, based on technological capability, innovative design, extraordinary service and exceptionally high quality. These clearly validate the premium prices charged on each coffee cup, which by far exceeds the differentiation costs.
Target market profiles
Starbucks targets adults in all classes of people including those who fall within the high, middle, and low-income classes. The categories can afford the range of premium coffee products sold by the company. The primary targets in this profile are workers and homemakers inherently in charge of purchasing foodstuffs.
Starbucks also targets teenagers or youths with products such as premium coffee. Additionally, the company indirectly targets children through their parents with most of the company products.
Layout
From Starbucks report, the managerial formation seems to be rather horizontal but well designed and efficient. This works well within the environs where Starbucks trades take place. All Starbucks outlets have both the subordinate and retail administrators provided each outlet could accumulate weekly revenues amounting to twelve thousand U.S. dollars. There are various subordinates and reallocation controllers in each organization level.
However, to preserve client familiarity, distinctive and external consistency, the Seattle head office makes decisions regarding the structure and arrangement of each outlet. The outlines for the outlets are decided in the head office to ensure consistency. Every outlet receives an outline slip wherever an internal outlet formation or novel services and goods are launched.
Workmates thereafter carry out their duties of rearranging the retail outlets founded on the novel outlines. Moreover, the manner in which trade objects, drinks and tartlets are organized in the trade fair areas are established via the company plan. This warrants that whichever retail outlet a client visits, the peerless foodstuffs mixture, ambiance and arrangement for Starbucks is maintained.
Starbucks atmosphere
Starbucks ambiance is strategically ideal when targeting certain groups of customers. The location of Starbucks stores tends to be in a fully equipped atmosphere that every customer would wish to spend more time in such stores. In fact, it has comprehensive guidelines including no smoking, provides outlets for electronic equipment, as well as offers comfortable furnished seats. The prototypical atmosphere therefore makes it certain for the consumers to be comfortable when consuming Starbucks coffee products. Besides, the stores have nice music that creates an atmosphere for consuming coffee.
Location
The establishment of Starbucks in the fiscal 1971 aimed at developing an organization, which is the leading seller of the world’s first-rate coffee. Its foundation started in Washington at Pike-Place souk situated in Seattle. It has operated in more than fifty nations with most of its strong presence in the UK, Canada, Japan, China, Portugal, Poland, Kuwait and Bulgaria. Starbucks Corporation has amplified its operational stores internationally. The stores range from seventeen stores that it boasted of in the fiscal 1987 to more than 16,635 retail outlets it currently manages in over fifty states. Most Starbucks operating retail stores are spread universally with over 11,000 stores found in the United States and nearly 6,355 opened internationally.
Grounds for being fond of Starbucks outlets
Consumers’ contentment: At Starbucks Corporation, consumer pleasure appears to be extremely vital. From the retail outlet doors to the final food chip, the clients have the impression of exclusivity as they consume products offered by this company. Undeniably, coffees from Starbucks Corporation provide every ground why consumer servicing is crucial.
Perfect and innovative coffee cups: The history of Starbucks clearly depicts that the company places more weight on the quality of products offered. While coffees products tendered are slightly dear than anticipated, Starbucks coffees are famous for quenching the client’s thirst with their alluring, loaded scent and zest. The coffee cups comprise of inventive and artistic dreams that attach value to Starbucks operations and foodstuffs. Originality enables Starbucks to add different aromas to its coffees, additional foodstuffs to its menu and became the first company to offer online facilities in its retail outlets.
Third-place: Since its inauguration, the promotion plan for this company has been tailored towards designing a decisive outlet for all clients going between their residential places and offices. The creation of such a calming and distinctive atmosphere and experience for individuals and groups materializes to be very important for this corporation given that it is a resilient model that strongly attracts and retains most customers.
Smart partnerships and the creation of Starbucks communities: This Corporation is recognized for its strategic creation of joint ventures. This implies that to increase its global market dominance, smart business partners that Starbucks has formed helps it to augment its twelve-monthly sales. Furthermore, marketing approach adopted by Starbucks has been extended to produce a community about its various coffee products.