Empirical Study: Starbucks Essay In Taiwan.

Discuss About The Empirical Study Starbucks Coffee In Taiwan?

Marketing mix is an essential tool for analysis of any organization. It throws light on the 8 important Ps of the business. These 8 Ps form the backbone of any organization and it is imperative that these are clear in the minds of the marketers as well as their customers. This report throws light on the 8 Ps of Starbucks which is a leading café chain spread across the globe. The report also consists of various recommendations suggested upon the 8 Ps of Starbucks along with a brief upon the contemporary issues that affect the organization.

Starbucks was founded in Seattle, Washington in the year 1971 and has been a leading name in the coffee industry since then (Schultz, 2012). Currently, the brand operates in over 23k locations across the globe. The company was founded by three friends, Gordon Bowker, Jerry Baldwin and Zev Siegl. The brand is largely well known for its coffee, effective service, ambience and quality of products. Starbucks, as the organization often says, has aimed to create a third place for people between their workplaces and homes. The Starbucks ambience is positive, friendly, comfortable and highly efficient. The couches are comfortable and all the outlets are equipped with a sufficient number of charging points and free Wi-Fi (Tu, Wang & Chang, 2012). 

Starbucks offers a range of products in the line of hot and cold beverages and snacks. One of the most easily available and widely demanded product of Starbucks is their ‘Cappuccino’. The product can be modified by asking to add additional flavors like caramel, hazelnut or vanilla. It is a hot beverage and owing to high amount of caffeine, it is desired by most people as a refreshing beverage. Cappuccino was also one of the most basic products of Starbucks which is being offered since the inception of the brand.

Target market includes those set of customers whose needs and demands the business expects to fulfill. It is important to know your target customer in order to be able to effectively cater to their needs (Armstrong, Kotler, Harker & Brennan, 2015). Owing to the wide variety of its products, Starbucks caters to a huge target market. Primarily this target market involves young men and women who spend their leisure time at Starbucks. They consider the café as a place where they can spend time with their friends and family. Secondly, the office going professionals are also targeted by the brand. The free Wi-Fi and numerous laptop and phone charging points are a clear advantage and has led to people conducting various official meetings in the café. Lastly, small children have been catered to by the brand with their customized offerings like warm milk, hot chocolate and shakes.

Selected Product

This is the primary aspect of any business. Starbucks has a huge product line which is inclusive of hot and cold beverages and snacks. The product referred in the report is the classic cappuccino offered by Starbucks. It is a strong coffee and can be customized by adding additional flavors or coffee shots. It is largely available and demanded as it is the most primitive form of coffee which is loved by all. Over a period of time, Cappuccino is becoming a necessary good in the lives of people owing to rise in coffee addiction.

Starbucks was founded in Seattle but is currently present in over 23k locations across the globe. The café has entered various countries by either opening up franchisees or by entering into joint ventures with already existing brands. This has been largely fruitful for Starbucks and has led to their growth and development as a brand.

Starbucks aims at opening up its outlets in largely commercial locations like malls and airports. This also enhances the brand’s presence and awareness and leads to a larger footfall (Kotler, 2015). The strategic finalization and placement of Starbucks outlet is intentionally done to attract a large number of customers at the heart of various cities.

Starbucks products are priced differently in different countries. However, overall the brand has adopted premium pricing strategies to attract the niche customer segments targeted by the brand (Haskova, 2015). The leading competitors of Starbucks are Café coffee day, Barista coffee, Costa coffee and Dunkin Donuts. On an average Starbucks products are priced higher than all these competitors. Being a global brand, currency fluctuations of different countries also impact the pricing of products in that country.

Promotional activities are conducted by businesses in order to reach out to their consumers and enhance their brand’s awareness to a large set of customers. Promotional activities also enable companies to set the right positioning in the minds of the consumers and leads to an improved brand image of the company (Kotabe & Helsen, 2014). Starbucks has adopted various promotional strategies to promote its goods to consumers of the target market. Few such strategies are as below:

This is one of the leading promotional tools adopted by companies. Social media marketing refers to organizations promoting their products and services to their customers through various social media platforms like Facebook, Instagram, Pinterest, Snapchat and Twitter (Boone & Kurtz, 2013). These social media platforms are becoming a bridge to enable a two way communication between the organization and its customers. It also enables businesses to reach out to a large number of customers through a single channel. Starbucks is extremely active on all these social channels and has garnered immense traction among customer spread across different parts of the globe. This is one of the biggest advantages of social media marketing (Tuten & Solomon, 2017)

Target market

Television advertisements and ads published on newspapers are a source of one way communication for organizations. These channels are highly effective in reaching out a large audience in the matter of a few seconds (Boyland & Halford, 2013). Starbucks television ads are creative, effectively timed and have a high TOMA score (Top of mind awareness). They are published in leading newspapers and channels of different countries and are widely accepted by people.

Starbucks has also placed various billboards and hoardings across different geographies to grab attention of passerby’s and enhance its brand awareness. Billboards are large and easy to eye and hence an interesting content placed on the board will be easy to register (Boyland & Halford, 2013).

Starbucks strategically places these billboards to ensure attention from customers for the maximum possible time.

Processes form the core of any business and help organizations in improving their service delivery, production speed and inventory management (Khan, 2014). Starbucks’s service delivery is efficient owing to competent staff. Once the order has been placed, the wait time ranges from 5 minutes to 15 minutes for the order to be presented on the table. If there is a complaint with the food, the staff immediately fixes the issue and replaces the order at no additional charge. Starbucks has also tied up with various food delivery organizations and consistently follows up with them regarding the speed of delivery. Starbucks also ensures appropriate behavior of all their staff members. They have dedicated vendors to supply them the raw materials for their products and have maintained long term positive relationships with them.

People associated with the organization effectively include all their direct stakeholders including their employees, customers, founders, investors and board of directors. The organizational culture of any business is the result of the people associated with the business. The culture adopted by Starbucks is one of its biggest strengths. Their organization working experience is fun, creative, responsible and largely flexible. The organization believes in open channels of communication that build trust. Employees are trained to treat all their customers well and the similar culture is seen across all their outlets.

The physical evidence demonstrated by Starbucks includes its office space as well as various outlets spread across the globe. The outlets are marked by a grand Starbucks logo on its entrance and various interesting quotes placed on their walls. The couches are specially designed for the brand to ensure comfort of their customers. Wi-Fi is installed across all outlets and provided to customers free of cost. Starbucks offices are placed in every country of its operations and employs a large number of people from across the world (Wirtz, 2012).

Marketing mix analysis

Customer reviews of Starbucks on their website, social media as well as delivery giants like Zomato are also a physical evidence of the company’s growth and success. Their personalized coffee mugs with the customer’s name on it have garnered immense buzz across various social media platforms also form a part of the physical evidence demonstrated by Starbucks (Gordon, 2012).

Since its inception, Starbucks has partnered with various leading brands across the globe to enhance their presence and competence in the market. While expanding onto international boundaries, Starbucks also gets into various join ventures with established local businesses. Starbucks also has various community centers like Seattle sounders FC and The Seattle foundation for their humanitarian works. They are also the official partners of the upcoming Special Olympics to be held in 2018.

In order to enhance its digital presence, Starbucks has also partnered with Spotify, a leading music application. In India, Starbucks has entered into a joint venture with industry leader Tata Corporation. Similarly, in Japan, the brand has tied up with Sazaby Inc. These partnerships have helped the company’s growth and brand awareness leading to an improved brand image.

Starbucks is a highly successful coffee chain which is well known for the high quality of its products and excellence in customer service. Many strategies adopted by the company have hit the nail on top in an effective manner. However, there is still room for improvement. Few recommendations for Starbucks are as below:

Introduction of more products as per the changing needs of the people is recommended to Starbucks to make sure that the company is able to fulfil the needs of their consumers. Example making products that are gluten free or vegan can largely impact their customer base. Serving food specifically prepared for lactose intolerant customers can also lead to improved sales and help the brand target this niche market as well.

Starbucks already has over 23k outlets across the globe. However, drive through or take away facility can be installed to target those consumers who do not wish to park their cars and enter a facility for a cup of coffee. This improvement will help in increasing sales for Starbucks and will lead to an added convenience for the consumers.

At present Starbucks products are premium priced. Therefore, introducing competitive pricing for certain products can help in increased sales and an improved target market (Mooradian, Matzler & Ring, 2013). Loyal customers could also be provided with Starbucks cards where they could earn points on every purchase and redeem those points in their next purchase.

Place

Starbucks has effectively pushed the social media envelope effectively and has a prestigious following of a large number of members across every platform. Snapchat and live features of Instagram and Facebook can be further utilized to be able to cater to an improved target market (Vaterlaus, Barnett, Roche & Young, 2016). Starbucks already adopts to various customer engaging strategies on Twitter and Facebook. The brand could now focus on bringing in more use generated content leading to enhanced trust.

Starbucks process must be maintained the same through consistent training of employees and deeper relationships with their vendors. Installation of an even more effective inventory management tools might lead to reduced wait time for consumers. However, such a strategy can be recommended post a cost benefit analysis.

Increased number of trainings for employees and efforts put in to ensure a higher employee retention are recommended. The organization must at all times ensure that the increased internationalization does not impact the organizational culture of the firm across all their offices and outlets.

The physical outlets and offices of Starbucks are highly competent. A drive through and pick up zone can be installed in the outlets for added convenience of customers. The products offered could also be modified to suit the changing social needs of people. The billboard ads must be creatively designed and changed every two months for increased retention in the minds of consumers. The logo of the brand, coffee cups and outlet infrastructure must be maintained as it currently is.

The current partnerships of the firm must be maintained. Starbucks could aim at attaining a higher share in their joint ventures. More partnerships would be formed with increased expansion and Starbucks must aim to build profitable and long term relationships with these partners.

Social media interactions of Starbucks are prevalent across all social media platforms like Facebook, Instagram, Twitter and Pinterest. The brand has effective pushed the social media platform and targeted the desired set of consumers in their spaces. Social media has also helped Starbucks build a two way communication directly with their customers. The brand has demonstrated effective social listening skills and continues to respond to customers on these platforms. These social media interactions are highly beneficial for organizations in gaining transparent feedback. At the same time, user reviews on these platforms can lead to an improved brand image in the minds of its consumers.

The increase in social media interactions is evident in the current scenario and it is imperative that organizations take advantage of these interactions to mark a significant presence for the consumers. Social media interactions have made the industry rather transparent and it has become easier to analyze the strategies of competitors as well. Starbucks has extremely competently managed its social media image and this has led to a positive image and goodwill for the brand across boundaries.

Price

Globalization is a concurrent phenomenon and has made the world a flat place. Globalization has also made the flow of information, people, goods & services, technology and brands (Beck, 2015). Globalization has enabled brands like Starbucks to begin and succeed in their international journey. Today, Starbucks is present across 5 continents and this is a benefit of Globalization. Through this, Starbucks has sold various franchises and entered into successful joint ventures. The look, feel and even the culture of Starbucks outlets has remained the same throughout the world.

Globalization has also increased the disposable income of people across the globe and has made Starbucks affordable leading to increased business for the brand (Pieterse, 2015). Today, the brand is renowned among a lot of people and leading businesses are willing to collaborate with Starbucks. The enhanced awareness of the brand and its widespread reach is the gift of globalization in the world.

Conclusion

Starbucks is a leading coffee chain that was founded in Seattle. The product in discussion is its cappuccino. The brand has its presence wide across various countries. This report discusses the 8 Ps of marketing for Starbucks. The products of the brand range between hot and cold beverages and snacks. These products are premium priced to attract the niche customer segment. Starbucks specifically designs its outlets to make it comfortable for its customers with prompt availability of services.

Starbucks aims are creating a third space for its customer between their homes and jobs. As the firm often says, that they don’t sell coffee, they sell an experience. This experience is largely cherished by their customers. The organizational culture of Starbucks is also fun, lively and highly flexible. The efficiency of their processes ensure prompt service and satisfied customers.

Interaction through social media and increasing globalization are leading contemporary issues that have helped the brand reach out to a much wider audience (Shankar, Carpenter & Farley, 2012). Globalization has made it easier for Starbucks to mark its presence in international boundaries. While social media interaction has enabled the brand to build a deeper and stronger connect with their customers.

References

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