Starbucks Coffee Company - Research Paper Example

This is a persistent human behaviour, whether there was Starbucks or not. Some people go to bars, but coffee shops provide a great alternative. The fact that Starbucks took this behaviour and institutionalized it was a strategic success. b. Development of long-term buyer-seller relationships (Griffin, 2011: 498) Starbuck’s aim was ‘to create a relevant, emotional and intimate experience’ in order to build trust with the consumer (Jain, 2009: 3). By creating a unique relationship that cannot be matched by having just another cup of coffee in another coffee shop, customers seek to relive the pleasant personal experience by returning repeated to the same brand. c. International marketing mix (Griffin, 2011: 498) Schultz, who conceptualized Starbucks’ renowned business model, developed his concept from observing Italian coffee bars and was impressed that each had its own character (Jain, 2009, p.1). Starbucks has grasped the universality of appeal in what was an Italian custom, and replicated this in all the countries the company was able to successfully market to. d. Value creation in its operations process (Griffin, 2011: 347) In the case, it was said that Americans will not pay a high price for coffee (Jain, 2009: 2), but Starbucks was able to overcome that, because customers found value in the store ambience and the service, which actually comprise its operations process.

Cleanliness, a relaxing atmosphere, prompt and courteous service are as much a part of the product as the coffee itself, for which reason people find value in it to pay a high price for it. 2. SWOT Analysis in point form. Strengths Ability to accommodate customers’ requests (‘just say yes’): Enhanced customer satisfaction and brand loyalty. Store ambience and design: Created a comfortable atmosphere that encouraged repeated and long-term seller-buyer relationship that reinforced brand loyalty.

Strong employee culture: Generous benefits keep employees engaged and high employee morale encourages innovativeness and pleasant staff-customer interaction. Weaknesses Too many stores located close to each other tended to cause stores to ‘cannibalize’ each other’s customers The competitive advantage is essentially replicable. Unlike manufacturing which can patent its product design or manufacturing process, what Starbucks offers – coffee blends, ambience, service – can be replicated by others, as it already has.

Opportunities Expansion to international markets; emerging market such as China and India, allows the firm alternatives to its already saturated market. Innovations in coffee preparation could further be explored, such as the Frappuccino developed by its staff. Threats Strong competition has posed challenges not only for coffee but tea and other products Economic weakness discourages personal consumption spending. Environmental and anti-globalization activism targets multinationals like Starbucks. 3. Compensation provided baristas Starbucks’s compensation package was described as generous because it included health benefits for both full-time and part-time employees who rendered 20 hours of service per week, and also provided them stock options which is a gain-sharing plan (Griffin, 2011: 258).

The advantages to the company were enhanced