Analysis of Starbucks Frappuccino-a brand extension of Starbucks

1. Starbucks Frappuccino

2. Content
• About the company
• Product category
• Brand extension: Starbucks Frappuccino
• Market share and growth of Starbucks
• Marketing Mix: 4 P’s
• STP
• Starbucks mental map
• Starbucks perceptual map
• Comparative frame of reference and POP-POD
• Brand resonance model for Starbucks

3. Manufacturer: Starbucks Corporation
https://www.youtube.com/watch?v=nn0bB9A9n4c
Founded in 1971
in Seattle, WA
Largest coffeehouse
company in the world
21,536 stores in 65
countries and
territories, including
12,218 in the US
HISTORY OF STARBUCKS

4. Starbuck’s category extension
USING ITS BRAND EQUITY AS LARGEST COFFEEHOUSE IN THE WORLD
TO VENTURE INTO
STARBUCKS LAUNCHED

5. Ready to drink coffee US Market
199.30 205.70
238.60
286.50
350.40
378.00
399.20
417.80
433.60
0.00
50.00
100.00
150.00
200.00
250.00
300.00
350.00
400.00
450.00
500.00
2009 2010 2011 2012 2013 2014 2015 2016 2017
RTD coffee market in US
Off-Trade volume in mn liters
Source: GMID
Tremendous growth
and projected to
grow further in the
coming years

6. Birth of Starbucks Frappuccino
1996: Partnered with PepsiCo to make RTD bottles
1995: Launched Frappuccino in 550 stores in U.S. & Canada
1993: Starbucks experienced slow down in summers
Source: frappucinno.com

7. “We were so
confident of
our product
that we didn’t
even test-
market it,” -
Schultz in his
book, Pour
Your Heart
Into It.

8. Timeline of Starbucks Frappucino
Source: frappucinno.com

9. Timeline of Starbucks Frappucino
Source: frappucinno.com

10. Starbucks and Frappuccino market share
72%
15%
Market Share of Starbucks Corp in
RTD coffee (2014)
Starbucks Corp
Monster Beverage
Corp
WhiteWave Foods Co
Rockstar Inc
Campbell Soup Co
Starbucks
Frappuccino
49%
Starbucks
23%
Monster
15%
Market share of Frappuccino in RTD
coffee
Starbucks
Frappuccino
Starbucks
Monster
International Delight
Rock Star Roasted
Source: GMID

11. Starbucks and Frappuccino growth story
0.00
20.00
40.00
60.00
80.00
100.00
2009 2010 2011 2012 2013 2014
81.80 83.20 79.20
70.60 68.70 72.30
Starbucks in RTD coffee in USA
0.00
10.00
20.00
30.00
40.00
50.00
60.00
70.00
2009 2010 2011 2012 2013 2014
66.60 65.80
59.10
53.40
46.40
49.30
Frappuccino in RTD Coffee in USA
Source: GMID

12. Marketing Mix
Product Price Place Promotion

13. Marketing Mix-Product
Price Place Promotion
“The Frappuccino transformed it into a haven for moms and office workers,” -Taylor Clark in Starbucked.
P
R
O
D
U
C
T

14. Product variety

15. Place
Marketing Mix-Price
Product Promotion
P
R
I
C
E

16. Price of different flavors
(9.5 ounce each)

17. Marketing Mix-Place
PromotionProduct Price
P
L
A
C
E

18. Intensive distribution
Captured variety of channels including e-retail

19. Marketing Mix-Promotion
PlaceProduct Price
Starbucks has traditionally spent very little on advertising
P
R
O
M
O
T
I
O
N

20. Starbucks advertising
• Slogan- “Uniquely Starbucks”
• Print advertisements and hoardings
• Discounts and schemes to attract new customers

21. STP
Segmenting
Targeting
Positioning

22. Segmenting
Behavior
(user
status)
• Coffee lovers
• Neutral to coffee
Psycho-
graphic
(Lifestyle)
• Walk to coffee
shop
• Drink at
home/workplace
Demo-
graphics
• Age
• Gender
• Occupation

23. Target segment
Not avid coffee
drinkers
Like to drink coffee
at home/workplace
Housewives who
stock chilled drinks
at home
Targeting

24. Competitive frame
of reference
• Convenience in storage
• Refreshing drink for
summer
• Variety in flavors
Positioning

25. Positioning
Low price
High price
High variety in
product-line
Low variety in
product-line
Perceptual Map
Starbucks
FrappuccinoMcCafe
Monster
Dunkin
Donuts

26. POP & POD
• Coffee
• Tasty
• Brand name
• Premium
Points of Parity
• Cool drink
• Ready to drink
• Non-aerated
• Available in multiple flavors
• Convenient to store
Points of
Differentiation
Positioning

27. Starbucks mental map

28. Positioning
Convenient Chilled
Customized Cool/trendy

29. Frappuccino brand building

30. Recap
• About the company
• Product category
• Brand extension: Starbucks Frappuccino
• Market share and growth of Starbucks
• Marketing Mix: 4 P’s
• STP
• Starbucks mental map
• Starbucks perceptual map
• Comparative frame of reference and POP-POD
• Brand resonance model for Starbucks

31. MADE BY :
TIMSI GUPTA
IIM LUCKNOW
PGP30401
SUBMITTED AS PART OF COURSE
“BRAND MANAGEMENT"
TAUGHT BY
PROF. SAMEER MATHUR