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ROLL NO A 10
JULY 2012-2014 BATCH
Starbucks is an international
coffeehouse chain based in the
Starbucks is the largest coffeehouse
company in the world with13279
stores located in the US and 20891
stores in 62 countries.
1971-The first Starbucks opened in Seattle, Washington,
on March 30, 1971 by three partners Gordon Bowker,
Jerry Baldwin, and Zev Siegl.
1987- In 1987, the original owners sold the Starbucks
chain to former employee Howard Schultz who rebranded
his Il Giornale coffee outlets as Starbucks and became
the CEO of the company.
1992- Company went public and Initial public offer issued
in the stock market in June 1992.
2002-Fourtune magazine named Starbucks as one of the
“100 Best Companies to Work for”.
Financial Results for 2012
Revenue US$ 13.29 billion
Operating income US$ 1.99 billion
Net income US$ 1.38 billion
Total assets US$ 8.21 billion
Total equity US$ 5.10 billion
In the beginning “ Establish Starbucks
as the premier purveyor of the finest
coffee in the world while maintaining
our uncompromising principles while
Now “ To inspire and nurture the
human spirit - One person, One cup,
and One Neighborhood at a time."
Specialty coffees sold at retail
through supermarkets (Nestle)
Kraft General Foods
Coffee – mocha , lattes
Coffee-related accessories and equipment including
thermoses, mugs, packaged ground coffee and hot
chocolate, are also products sold at Starbucks.
Tea- Tazo brand in tea.
1 “Perfect Cup of Coffee” – Their coffee, even if priced
slightly more expensive than expected, is famous for
satisfying customers with its rich, delicious taste and aroma.
2 “Customer Satisfaction” –. From entrance to the store to
the very last drop of their coffees, it is a must that customers
feel the uniqueness of enjoying their Starbucks coffee
3 “Creating a Starbucks Community” – Starbucks started a
community website, My Starbucks Idea, designed to collect
suggestions and feedback from customers.
“Innovation” – They’ve added different flavors to their coffee,
more food on their menu, free weekly song or app download from
iTunes, free Wi-Fi internet usage, free birthday drink.
“Brand Marketing” – The Starbucks marketing strategy has always
focused on “word-of-mouth” advertising and letting the high
quality of their products and services speak for themselves.
“Monopolistic”-Some of the methods Starbucks has used to expand
and maintain their dominant market position, includes buying out
competitors' leases, intentionally operating at a loss, and
clustering several locations in a small geographical area
for saturating the market.
Just Say Yes” policy in order to keep the customer happy.
• Example: Always compensate dissatisfied customers with a
Starbucks coupon entitling them to a free drink
• Example: Give a customer a free refill if he/she spills their
My Starbucks reward program allows members to earn a free
drink after every 15 purchases at participating Starbucks stores.
Starbucks Card – It is a stored-value card for customers to use
Most stores are located in high-trafficked,
high-visibility areas, such as:
1ƒ Office buildings
2ƒ Downtown and suburban retail centers
3ƒ Airport terminals
4ƒ University campuses
5ƒ Busy neighborhood shopping areas
convenient to pedestrian traffic
Usually price and quality determines the value of the
product. Starbucks always tried to deliver high value to the
consumers by buying quality beans, assuring that their
staff got effective & efficient training, and mostly,
creating an environment to enjoy coffee. For this,
Starbucks’s customer had to pay more; it was expensive.
To keep the competitive edge, the company also began to
implement other value added services like, introducing $3.95
"breakfast pairings," which includes breakfast items along
with a coffee (2010). This is to target the price conscious
STARBUCKS IN INDIA
Starbucks had entered the Indian market in October
2012 and currently operates five stores in Mumbai
and four outlets in New Delhi.
Tata Starbucks Ltd, the 50:50 joint venture between
Starbucks Coffee Company and Tata Global
Beverages Ltd. launched the latest outlet at Select
City Walk Mall.
Tata Global Beverages vice chairman R K Krishna
Kumar had announced plans to open 50 cafes in
the country in 2012, entailing an investment of Rs
Segmenting and Targeting
Starbucks uses demographic
segmentation(markets by age, gender,
income, ethnic background, and family
life cycle) as well as geographic
segmentation (markets by region of a
country or the world, market size,
market density, or climate)
Starbucks„ main target market is men
and women between the ages of 25-44,
which accounts for almost half (49%) of its
Young adults, aged 18-24, are the next large
group that Starbucks targets. They bring in
about 40% of Starbucks' sales.
Starbucks also uses geographic
segmentation. Starbucks is located all
around, specifically in upscale locations,
near offices, and near many college
Target Marketing for young
adults (aged 18-24 )
Starbucks target this group through the
growth of technology and innovative
Starbucks positions itself as a place
college students can hang out, study,
write papers, and meet people.
Target Marketing for Men
and Women (aged 25-44)
Starbucks targets this group by offering certain
drinks that appeal to them.
Starbucks targets this group creating the “third
place” to go to between home and work by
creating this unique and relaxing “experience” and
“atmosphere” as customers within this range tend
to have high income and professional careers
Starbucks has positioned themselves
as a highly respected brand.
The Starbucks company has positioned
itself in a way that it can distinguish their
products from competition, which gives
them an advantage.
Their positioning strategy is customer
based, which allows them to give the
best customer service.
Starbucks hold onto their sustainable
competitive advantage in terms of their
customer satisfaction as well as their
Starbucks marketing strategies even
though unusual has been very
successful since last 40 years.
As long as Starbucks fulfills its
customer’s wants and needs, Starbucks
will continue to be a leading force in the