Starbucks' clients have less money in their pockets than they used to. They may have lost their jobs or cut back on consuming luxury coffee like Starbucks. Furthermore, as the housing bust has unwound, whole neighbourhoods have changed. They will want to reconsider the placement of cafes. These are just several of a number of recommendations included below to help Starbucks weather this storm and once again get back on top of the coffee world. Starbucks is a very strong brand with a loyal following. They are well positioned to storm back to the top of the charts. Over the years, Starbucks has proved itself to be a very successful company. It is has expanded substantially and is a recognized brand. But the financial crisis and economic downturn had a severe impact on its revenue (see figure 1, appendix). Now is the time to consider a number of steps which can help Starbucks restore itself to its former glory. It is not a matter of simply returning Starbucks to the position it held before the crisis. Many things have changed in the marketplace since then. Success may well mean something different now. Starbucks must look around at a changing marketplace and seize new opportunities. In some cases it may have to shift its focus in order to maximize returns. What follows are five recommendations to ensure the Starbucks does not become a relic. The recommendations aim to help Starbucks focus on its customers and its future. Lower cost and rebrand The era of conspicuous consumption is over. The economic crisis made sure of that. It resulted in serious damage to national economies worldwide and the cuts that will have to result to bring down the deficit have not yet been made. Things are going to get worse before they get better. This is a problem because the price of Starbucks coffee is too high. Competition with MacDonalds may be negatively impacting Starbucks sales (Ordonez). The truth is that the climate has changed and cost is a big factor for many people these days. We need to see a small reduction in the price of a cup of coffee at Starbucks. That alone will be worth media attention and will be a kind of signal to consumers that Starbucks takes this issue very seriously. A lot of the coffee is overpriced and this overpricing is not sustainable with new competition in the market. Reducing the price even ten or fifteen per cent will show consumers that Starbucks is willing to change and adapt to new economic realities. This can be part of a rebranding that will make Starbucks more appealing to a larger audience. The communications element of branding is key to attracting more customers (Capon, 296). Currently, Starbucks is seen as a hipster place where the elites go to sip an expensive latte. There is no reason to lose this cache, but it makes sense in this economic climate to try to create a larger tent in which many different types of people can come and enjoy themselves. Starbucks needs to think long and hard about who it wants to attract in 2012 and beyond. The larger the customer base the more stable the company. It is important to remember that rebranding can be a risky proposition (Muzellec, et al, 802). Approach it with caution. Expansion into new markets Starbucks is seen primarily as an American company, with most of its cafes in North America and Western Europe. These generate a lot of ...
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(Recommendation Memo for Business Trend Essay Example | Topics and Well Written Essays - 1500 Words)
“Recommendation Memo for Business Trend Essay Example | Topics and Well Written Essays - 1500 Words”, n.d. https://studentshare.net/environmental-studies/19375-recommendation-memo-for-business-trend.