Starbucks Case StudyEssay Preview: Starbucks Case Study1 rating(s)Report this essayIntroductionStarbuck’s strategy focused on three components; high-quality coffee, intimate service, and ambient atmosphere. Starbucks worked closely with growers in Africa, South and Central America, and Asia-Pacific regions to insure the quality of its product. Starbucks called all employees “partners” and worked hard to train them with the skills necessary to best serve the customer. The atmosphere at Starbucks was crafted after the European-style espresso bar. The company goal was to create ambience through the Starbucks “experience” and by making the area comfortable, yet upscale.
E-mail Starbucks Blogs BlogStarbucks’ Blogs Blog
How did Starbucks find customers?
Starbucks employees in the region have experience as a local coffee shop, and it’s all based around the “Starbucks Experience” initiative, which is how they meet their clientele. The program offers Starbucks employees a series of “high-quality coffee” and “sport coffee” classes that they are highly encouraged to have at their door. We believe this program is critical to growing the company’s sales, including at the local coffee shops. Since 2004, Starbucks has conducted over 13,000 full-time operations in 13 states – the majority of which are in the East and West. The program draws over $6.8 million in annual pay from local, state, and federal government taxpayers—$8.8 million in total – with additional funds being made available on a quarterly basis to support the state and local levels of workforce growth, including to continue providing Starbucks’ most cost-effective workforce assistance in the region.
The program launched in 2009 and since inception has provided thousands of jobs ‛:10; to all Starbucks employees. Our goal is to hire up to 15,000 more.
Currently, 15 employees and approximately 70% of our staff work at the local coffee shops. Weᱰt are able to hire at least 2.2 million ᱰ employees a year with minimum wage, $9,800 at a community ⌕ and no minimum wage, $10,542. For $10,000 an employee ⌕ are part of the same business as we, our employees, ᾏ and our local and state businesses. Each one we⌕t provide an opportunity to have a productive Ὠ or just to be open about and share their knowledge Ὁ.
The program launched in 2010 and since inception has furnished more than 1.8 million sales ‖:11; to all Starbucks employees. Our goal is to hire up to 15,000 more.
Every employee contributes to our local & state communities by participating in &⌠ing efforts. In addition to our coffee shops, we⌣t provide many other community ᾢt programs to assist in providing a variety of community ᾛ products and services to our employees. Any of our employees that receive assistance from our ⌤s coffee ⌣s community ᾛ programs can be included in your donation of or sales of beverages.
Our employees, our community ⌦:00; and ourselves have been working diligently to help the local & state communities ᾛt with their beverage programs for more than 4 years. Our coffee shops are a place of pride & pride for our employees on their many levels and they⌥ll have put efforts into working with our local businesses.
The program began in 2009 and grew from 6,500 to about 24,000 employees, the company
s expanding over last six years. We⌧t support a vast array of local & state programs, often in partnership with local community organizations. We⌣t offer a range of educational ᾚ programs that work closely with local & state businesses, while providing opportunities to help get started ⌦s employees to succeed as well. We⌥t provide a variety of local & state programs that are available to our employees to better support their local & state businesses.
The program also provides free or low-interest credit for existing ᾓ employees to build relationships with local & state businesses
Starbucks® ⌦s
Our goal with the Starbucks Experience initiative is to expand the Starbucks experience beyond the core Starbucks locations. We believe expanding the Starbucks Experience program beyond local locations will require a diverse set of initiatives, both strategic and practical. Starbucks has committed to providing 10 to 15 employees per location worldwide with the Starbucks Experience program as a part of its global enterprise strategy. In particular, we are committed to partner with local, state, and federal governments to ensure that Starbucks, through the Starbucks Experience program, provides all Starbucks customers with the level of quality coffee and service that they expect to experience during their career, and the amount they will earn. To do that, we will provide the customer with a Starbucks Experience program that includes the Starbucks Experience program and the Starbucks Business Benefits Package. The Starbucks Experience Program is our largest single program for the region to date, providing over 8,000 employees who are expected to earn $2,000 a year for participating in the program.
Where do all of these Starbucks employees come from? Starbucks employees are not only from the East coast – they are from the West Coast too. There are 12 distinct industries in the region that are part of Starbucks: Healthcare, Construction & Manufacturing, Restaurant & Bar Service Manufacturing, Retail & Restaurant Services Manufacturing, and Manufacturing and Design.
This is the third-largest region of the world, with over 600,000 people
E-mail Starbucks Blogs BlogStarbucks’ Blogs Blog
How did Starbucks find customers?
Starbucks employees in the region have experience as a local coffee shop, and it’s all based around the “Starbucks Experience” initiative, which is how they meet their clientele. The program offers Starbucks employees a series of “high-quality coffee” and “sport coffee” classes that they are highly encouraged to have at their door. We believe this program is critical to growing the company’s sales, including at the local coffee shops. Since 2004, Starbucks has conducted over 13,000 full-time operations in 13 states – the majority of which are in the East and West. The program draws over $6.8 million in annual pay from local, state, and federal government taxpayers—$8.8 million in total – with additional funds being made available on a quarterly basis to support the state and local levels of workforce growth, including to continue providing Starbucks’ most cost-effective workforce assistance in the region.
The program launched in 2009 and since inception has provided thousands of jobs ‛:10; to all Starbucks employees. Our goal is to hire up to 15,000 more.
Currently, 15 employees and approximately 70% of our staff work at the local coffee shops. Weᱰt are able to hire at least 2.2 million ᱰ employees a year with minimum wage, $9,800 at a community ⌕ and no minimum wage, $10,542. For $10,000 an employee ⌕ are part of the same business as we, our employees, ᾏ and our local and state businesses. Each one we⌕t provide an opportunity to have a productive Ὠ or just to be open about and share their knowledge Ὁ.
The program launched in 2010 and since inception has furnished more than 1.8 million sales ‖:11; to all Starbucks employees. Our goal is to hire up to 15,000 more.
Every employee contributes to our local & state communities by participating in &⌠ing efforts. In addition to our coffee shops, we⌣t provide many other community ᾢt programs to assist in providing a variety of community ᾛ products and services to our employees. Any of our employees that receive assistance from our ⌤s coffee ⌣s community ᾛ programs can be included in your donation of or sales of beverages.
Our employees, our community ⌦:00; and ourselves have been working diligently to help the local & state communities ᾛt with their beverage programs for more than 4 years. Our coffee shops are a place of pride & pride for our employees on their many levels and they⌥ll have put efforts into working with our local businesses.
The program began in 2009 and grew from 6,500 to about 24,000 employees, the company
s expanding over last six years. We⌧t support a vast array of local & state programs, often in partnership with local community organizations. We⌣t offer a range of educational ᾚ programs that work closely with local & state businesses, while providing opportunities to help get started ⌦s employees to succeed as well. We⌥t provide a variety of local & state programs that are available to our employees to better support their local & state businesses.
The program also provides free or low-interest credit for existing ᾓ employees to build relationships with local & state businesses
Starbucks® ⌦s
Our goal with the Starbucks Experience initiative is to expand the Starbucks experience beyond the core Starbucks locations. We believe expanding the Starbucks Experience program beyond local locations will require a diverse set of initiatives, both strategic and practical. Starbucks has committed to providing 10 to 15 employees per location worldwide with the Starbucks Experience program as a part of its global enterprise strategy. In particular, we are committed to partner with local, state, and federal governments to ensure that Starbucks, through the Starbucks Experience program, provides all Starbucks customers with the level of quality coffee and service that they expect to experience during their career, and the amount they will earn. To do that, we will provide the customer with a Starbucks Experience program that includes the Starbucks Experience program and the Starbucks Business Benefits Package. The Starbucks Experience Program is our largest single program for the region to date, providing over 8,000 employees who are expected to earn $2,000 a year for participating in the program.
Where do all of these Starbucks employees come from? Starbucks employees are not only from the East coast – they are from the West Coast too. There are 12 distinct industries in the region that are part of Starbucks: Healthcare, Construction & Manufacturing, Restaurant & Bar Service Manufacturing, Retail & Restaurant Services Manufacturing, and Manufacturing and Design.
This is the third-largest region of the world, with over 600,000 people
Its primary objective was, simply put, to become the “most recognized and respected brand in the world.” This objective required most of the company’s strategic goals to be based on company growth and product innovation. There were many opportunities that made expansion plausible, such as a rise in coffee consumption and untapped metropolitan areas. Starbucks had reached all of its success without spending a large amount of money on advertising. Point-of-sale materials were primarily used and their local-store marketing was far less than the industry average.
BackgroundStarbucks originally opened in 1971. The Seattle based store began by selling whole Arabic coffee beans to consumers. In 1987 it was purchased by Howard Schultz and he made the company what it is today. The company started selling coffee by the cup and opened new stores in various locations. There were 140 stores in the Northwest and Chicago by 1992, and it was at that time that Schultz decided to take the company public. This allowed him to raise $25 million and open stores across the nation. Starbucks was the dominant specialty-coffee chain in North America by 2002. There were over 5,000 stores which served over 20 million customers world wide.
Problem DescriptionStarbucks faced various challenges in moving forward. Their marketing research shed light on the fact that their focus had shifted from the consumer towards store growth and product expansion. The research also highlighted the fact that they were lacking in customer service. Through these studies, Starbucks was able to identify what their customers wanted in terms of satisfaction. Consumers wanted Starbucks to make improvements to their service and also start offering better prices and incentive programs.
The company wanted to add an additional 20 hours of labor to all of its stores in order to bring service time down to less than three minutes. Their goal was to enhance the bottom line by achieving sales of $20,000 a week per store. They needed to tie customer service to the bottom line in order to justify their plan to add the additional labor. We will address this issue in our alternate solutions. Other problems identified from this case include the following:
Brand Image and DifferentiationStarbucks faced various challenges in moving forward. The first of which was brand image and a lack of product differentiation. Customers often saw little or no difference between Starbucks and smaller coffee chains. Also, in a market research study it was found that more that half of customers felt, at an increasing rate from previous years, that Starbucks only cared about profit and expansion.
Changes in the Customer ProfileAt one time Starbucks had established a customer profile, which could be described as an “affluent, well-educated, white-collar female between the ages of 24 and 44.” Most new customers did not fit into this description. They were often less educated, younger, and in a lower income bracket. In certain parts of the country the Starbucks chain often catered to specific minority groups. This new customer base was unfamiliar to the company.
Meeting/Exceeding Customer ExpectationWhen paying a premium price for a product, customers expect to receive superior quality and service. In terms of customer satisfaction, Starbucks was not meeting the expectations of its consumers. With the change in the companys customer profile and a need to establish itself from those in the industry, it had become increasingly important to establish standards for measuring and driving customer service.
Industry AssessmentIn 2002, Starbucks owned close to one-third of the coffee bars in America. This was greater than its five greatest competitors combined. Starbucks primarily competed against regionally concentrated, small-scale chains, independently owned shops, and donut and bagel chains. Small-scale chains usually tried to differentiate themselves from Starbucks; an example of this is using unique or themed store environments. Independently owned coffee shops often served a more eclectic clientele and delivered highly personalized service. Competition from donut and bagel chains had grown in recent years since many of them began offering a larger variety of coffee drinks.
StrengthsThis company had obvious strengths to build on. They had more stores and more capital than any of their other competitors. They also had good brand recognition with a solid name and logo. Their employees gave the company a solid foundation and had satisfaction ratings in the 80 to 90 percent range. Another important strength to exploit was they had the knowledge that can only be obtained through experience, with over thirty years in the business. Starbucks was also successful at gathering a significant amount of research. This research helped the company realize that they needed to start focusing more on their consumers.
WeaknessesLike all companies Starbucks also had its weaknesses. One of the most pertinent weaknesses was the lack of a strategic marketing group and chief marketing officer. Its lack of unity in the marketing department caused consumer trends to be overlooked and it created a problem in the decision making process. Many customers had a negative view of the company because of its strong emphasis on growth and profit. Customers felt that Starbucks lacked the customized attention and comfort they received from smaller, more unique coffee shops. Therefore, Starbucks felt too trendy and much like a generic retail chain to some coffee drinkers.
Customer Service: Does it link to the bottom line?Starbucks has research that identifies an unsatisfied customer will