Starbucks
Overview of Starbucks Starbucks purchases and roasts high-quality whole bean coffees and sells them along with fresh, rich-brewed, Italian style espresso beverages, a variety of pastries and confections, and coffee-related accessories and equipment primarily through its company-operated retail stores. In addition to sales through our company-operated retail stores, Starbucks sells whole bean coffees through a specialty sales group and supermarkets. Additionally, Starbucks produces and sells bottled Frappuccino® coffee drink and a line of premium ice creams through its joint venture partnerships and offers a line of innovative premium teas produced by its wholly owned subsidiary, Tazo Tea Company. The Companys objective is to establish Starbucks as the most recognized and respected brand in the world. To achieve this goal, the Company plans to continue to rapidly expand its retail operations, grow its specialty sales and other operations, and selectively pursue opportunities to leverage the Starbucks brand through the introduction of new products and the development of new distribution channels. Questions for Discussion • What is the core product that Starbucks offer? ... • How would you classify the Starbucks product using the marketing considerations for a consumer product outlined in the chapter? What individual decisions has Starbucks made? • How has Starbucks dealt with issues of brand equity, customer equity and brand positioning? • Is Starbucks a product or a service? How are the concepts of service marketing important to Starbucks? • What marketing recommendations would you make to Starbucks as it continues its international expansion? Research and Analysis Report Core, Augmented and Actual Product After a few weeks of research and analysis, I have found out that Starbucks provides services rather than just selling their specially brewed coffee. Starbucks’ core product would definitely be their high-quality whole beans, which are brewed only with the best equipment. Starbucks started out as a small time coffee house in Seattle, while coffee prices were dropping dramatically, competitors started to buy cheaper beans like Robusta beans. Starbucks saw this as an opportunity for growth; they started to focus on only the best beans, the Arabica beans. Starbucks started to brew coffee with the Arabica beans and it proved to be a success for them. ... Starbucks didn’t see coffee as just coffee instead they seen it as a services to the consumers who are looking to find the best brewed coffee which Starbucks provides. Starbucks coffee is has always been rich because, Starbucks will often taste and compare their coffee to one another. Starbucks would taste a few coffees at a time to compare its aroma, acidity, body and flavor. The aroma is the first hint of how the coffee would taste like because the sense of smell creates a taste that actually make Starbucks high-quality whole bean brewed coffee so satisfying. ... Lastly, flavor would is the utmost important melding of aroma, body and acidity which creates an overall impression that Starbucks only uses the best high-quality whole coffee beans. Starbucks augmented product would be their location which are strategically located in city areas and shopping centers. Starbucks has done intensive research on each area before they build their outlets. ... This made customers feel very pleased to patronize Starbucks. Starbucks augmented product would also to be able to communicate with its customers knowing their wants. Starbucks is trying to build a long-term relationship with its customers so that they would keep visiting Starbucks, not only for their coffee but also for their great services. Starbucks doesn’t only get their customers thru advertisements but also thru word of mouth of customers that have visited Starbucks and experience its added-value coffee. Starbucks recognizes each individual customers taste or preferences so that each time they visit they’ll still have the same feeling of warmth and smell the aromatic smell of the Arabica coffee beans, while relaxing to a cup of their favorite coffee at their favorite shop. Starbucks actual product would have to be the drinks and food that they sell in the outlets. Starbucks knows that customers who visited their outlets would not only love to have their coffee but also to have some cakes or cookies with it. ... Starbucks also sells mugs, CDs’ and provides Christmas cards to customers who are too busy to buy cards to wish their special someone or who enjoys the nice ambiance and would like to have their coffee served in their own mug. In each Starbucks outlet, there are also pictures of Third world farmers in its publicity. Starbucks knows that each individual has their own preferences of coffee differing on the richness, the amount of milk or the taste, which motivates Starbucks to add in more and more choices of different coffee mix in their menu.