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Swot analysis :
Strenghts :
The main strengths of Starbucks come from the companys brand image as well as the high
visibility that the company has in various markets. Additionally, Starbucks also has experienced
and competent workforce that ensures that quality services are offered to the customers. The
existing relationship with supplies of coffee beans also means that Starbucks is able to get
quality coffee all year round.
Weakness :
Even though there are a few weaknesses, the main weakness can be argued to come from the
companys overreliance on its CEO since its inception implying that the company might struggle
if the CEO was to leave Starbucks.
Opportunities :
One of the major opportunities for the company is that there exist various high potential markets
that the company can expand its operations into.
Threats :
The ever increasing number of the competitors in what can be described as an already
overcrowded market can be argued to be one of the major threats to Starbucks.
The Desired target market :
Starbucks Coffee Company was founded in 1971, in Seattle - selling high-quality green
coffee beans, they opened their first store coffee bar concept in 1984, and from there expanded
over the years to become one of the most innovative companies when coming to their marketing
strategies.
Starbucks Marketing (and why the innovation may be suitable)
Starbucks has succeeded in bringing the Italian concept of coffee houses to USA and then to the
whole world. The idea was brilliant but the strategies were also outstanding:
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Adaptation strategy: they always added new flavors, new drinks, new muffins and cakes.
They reached over 87.000 possible drink combinations and are even offering convenient
products in supermarket nowadays.
Starbucks coffee shops became a place trendy to be: for ambiance and experience ,
through the warmth and comfort offered, the friendly baristas, the perfect cup of coffee
Overall Starbucks has maintained a competitive advantage since creating its original blue
ocean of bringing quality, bistro-style coffee choices to the masses. In order to stay current it will
need to focus on its core competencies and avoid spreading themselves to thin. To avoid
competitors such as McDonalds and other coffee chains, they will need to create new value
innovation by enhancing the customer experience by investing in online content and
interactivity. Rather than creating more new products, I think their strength lies in their brand
and by enhancing the connection to their loyal customers, they will separate themselves from
McDonalds and others.
Financials:
A D-Table will cost arround 2500 Euros
No advertising fees, web based advertising (Youtube,Facebook,Starbuck Web site)
Each Starbucks coffee shops will have to pay only 15*2500$ =37500$ to have 15 DTable.
Benefits are expected to double starting from the first year.
Factors that motivate Starbucks to invest in the D-table
Before deciding either to invest or not, the management should analyze either this project is
profitable or not and if it is an effective and efficient tool that support the business to achieve its
objectives also it should analyze the industry where it operates. There are many questions should
be answered before deciding:
Do competitors have this service or its a differentiation factor for us?
Does this service create value to customers or not?
Does it help us to target new segments or not?
Does it increase our profitability and volume of sales?
In this project, we are talking about the D-table, which is a new service that can be offered by
Starbucks. The D-table builds and maintains the profitable lasting customer relationship, because
there are many people who will benefit from its business and entertainment furthers, they dont
need to bring their heavy laptop with them, they can access their online accounts, listen to music,
watch movies, do business conversations while enjoying the tasty coffee and the amazing
environment of Starbucks shops.
This enjoyable environment will keep current customers coming to us and the number of
interested people to discover new technology as well as business people who want to do online
meeting will increase also. This increase in customers numbers will increase our sales which
increase our revenue and profits.
No competitor currently is using this new service, which will gives Starbucks a differentiation.
Starbucks will be the different enjoyable environment for students, families, couples, IT lovers,
business people and other.
The investment in this project is very expensive; it requires millions of dollars, which
makes the entrance and the competition with Starbucks very difficult. This investment increases
the industry level, because the new service combined with the tasty coffee will give Starbucks a
strong position in the market.
All satisfied people will talk about this new service; it will be the talk of people. These
positive conversations will improve the reputation of Starbucks. Moreover, it will participate in
the increase of share prices in the stock market.
Corporate Benefits
There are many benefits for Starbucks from the D-Table. It will be able to gather
information about customers in order to fill the Customer Relationship Management database,
which allows Starbucks to analyze the customers orders to launch targeted and direct marketing
campaigns by promoting what satisfies their expectations. Moreover, they will be able to receive
the customers feedbacks, which support Starbucks R&D team to improve their products and
services in order to offer what people expect.
The operations process at Starbucks shops will be more organized, because customers will not
take the line to order and the employees will not be pressed by the direct receiving of orders.
The D-table is an effective and efficient media to advertise what Starbucks has of new products
and services.
Costumers benefits
One of the most important costumer benefits is the fact that the consumers can easily
order and purchase the Starbucks products using the D- Table. Moreover, the contactless card
payment functionality. All of that allows customers to have an enjoyable time without having to
queue whether it is to make an order or to pay their bills.
Another great opportunity for costumers is that they can get more information about the
products nutritional value calculated directly by the table.
There is also a direct access to activities for both adults and children such as watch movies or
games directly from the D-Table and a variety of games for the children.
The table also gives the customers the opportunity the recreate and customize their coffee time
by simply modifying the color of the D-table or even more by take virtually a coffee with a
friend(s) in the other side of the globe enabling the Starbucks call application and the ID of the
participants.
Starbucks is offering:
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Tangible products: coffee, beans, tea, food, cold drinks, bottles and mugs.
Intangible products: Relieved atmosphere, decoration, internet access within their coffee
shops.
Augmented products: By aiming for providing the best services and products, for
example they motivate the staff and the employees and encourage them to enhance
customers experience.
D-table technology enters within this category of products, because its a commodity that has
both the primary physical attributes and the non-physical attributes that are added to increase the
value of all Starbucks products it will then allow the company to attract more people, and to
make its brand image unique.
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D-table is going to change this already pleasant and enjoyable place into an extraordinary
spot where magic happens, where people can work, enjoy themselves, and easily take and pay
their orders etc This will definitely take the customers experience to a whole new level and
boost-up the mouth-of-word already operating over the company almost everywhere in the
world.