Products In 1994, after months of meetings and experimentation, PepsiCo and Starbucks entered into a joint venture arrangement

to create new coffee-related products for mass distribution through Pepsi channels, including cold coffee drinks in a bottle or can. In October 1995 Starbucks partnered with Dreyer's Grand Ice Cream to supply coffee extract for a new line of coffee ice cream made and distributed by Dreyer's under the Starbucks brand. Market strategy Starbucks is mainly a first mover company. They see trends and interests of their target market first, and adapt to meet those initial needs. Targeting Starbucks targeted office workers, with middle to high incomes, who had a desire to purchase premium products. Schultz wanted Starbucks to become the Third Place, the place between home and work where people could gather, relax and interact with one another so they were vigilant about their quality control to meet the high expectations. When Starbucks launched, they used this undifferentiated marketing strategy and they created and maintained the marketing mix considering the market as a single segment. A major difficulty in using this targeting strategy is developing the brand to satisfy all consumers (ibid.). Starbucks used their services without compromise in quality for attaining this. Positioning Starbucks tried to position themselves as a premium product in the coffee industry by creating a high standard, introducing innovative products and providing excellent service. They mainly concentrated on the quality and constantly involved in improving the quality, though the products were priced high they always delivered the promised quality to their consumers. They introduced seasonal products to maintain the premium brand image and to create differentiation from other coffee shops. Promotion The company spends very little on advertising and depends on word-of-mouth promotion.Starbucks try to keep their focus balanced between the college age, post-graduation and young family age, and the 30-40 year olds. Starbucks already has a strong presence on Facebook, Twitter, and many others. They keep watch on the trends and try to address the customers accordingly, they organize a big community event prior to the opening of its stores. Artworks were designed to boast each citys personality, and it was used on commuter mugs and T-shirts. Customer loyalty Employees are trained to connect with customers and focus on customer intimacy. Greet customers with a smile. Enthusiastically welcome customers into the store.

Making changes in the order apart from the menu how the customer wants. Try to remember customers names and orders if they are frequent customers in order to keep them happy which may go beyond store rules 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 drink.

Location Starbucks stores were located in office buildings, downtown and suburban retail centers, airport terminals, university campus areas, or busy neighborhood shopping areas convenient to pedestrian foot traffic. Only a select few were in suburban malls. Store layout Starbucks stores have a local appeal in their design they follow a concept design method and call their stores as sandboxes, they make sure that their design reflect the coffee heritage of their first store in Seattles historic Pike Place Market with worn wood, stained concrete or tile floors, metal stools and factory-inspired lighting. Large community tables, club chairs and wood blinds evoke a turn-of-the-last-century feeling. They make sure that each store would convey the right image and character. They also make sure that their stores also appear upscale yet inviting, and also provide facilities like offering live music, wi fi facility, Goal: To make customers want to linger Social AppealOffer a sense of community, a place where people can come together Physical layout Seating areas to encourage lounging Appear upscale yet inviting Aromas Smoking is banned in all stores Employees are asked to refrain from wearing perfumes or Colognes, and prepared foods are kept covered so Customers would only smell coffee aromas. Sounds Play soothing CDs that are also for sale Often offer live music Expansion to india MUMBAI, India Starbucks aims to open 50 outlets in India by year's end, through a 50-50 joint venture with Tata Global Beverages, the companies said Monday. Tata Starbucks Ltd., as their venture is known, hopes to capitalize on the rising aspirations and fattening wallets of many Indians, who are eager to partake of the globallatte life. "What we are seeing is an evolution in lifestyles," said R.K. Krishnakumar, vice chairman of Tata Global Beverages. "In some ways the distinctions between the developed world and the developing world are blurring."

He said the partners would initially invest 4 billion rupees ($80 million), with the first outlet to open in Mumbai or New Delhi by September. Long known as a nation of tea drinkers despite a rich tradition of coffee in the south India has embraced coffee house culture with a vengeance. Last year, India had 1,600 cafes, up from just 700 in 2007, according to Technopak Advisors, which expects India's $170 million cafe market to grow 30 percent a year, adding up to 2,700 more outlets over the next five years. "We're going to move as fast as possible in opening as many stores as we can so long as we are successful and so long as we are embraced by the Indian consumers," said John Culver, president of Starbucks China and Asia Pacific. Unusually, the stores will be cobranded "Starbucks Coffee: A Tata Alliance." The companies will also develop a tea for the Indian market under the Tata Tazo brand. Last January, Starbucks signed an agreement with Tata Coffee, a unit of Tata Global Beverages, to source and roast coffee beans in India. The alliance with Tata could help ease one of the main burdens for retailers in India: the high cost of real estate. Krishnakumar said the joint venture would open outlets at properties owned by group companies, for example at the Taj chain of luxury hotels. Culver said the company would also look at opening outlets in shopping malls, office parks, universities, airports and train stations. The alliance will also help Tata Global Beverages expand its international footprint. All coffee beans for the cafes in India will be sourced from Tata Coffee, which also hopes to ramp up exports to regional Starbucks outlets, Krishnakumar said. He said other Tata Beverage brands, like Himalayan water, should also find their way into Starbucks outlets globally. Culver said Starbucks did not consider trying to go it alone in India, despite the government's recent decision to allow foreign companies to operate single-brand retail outlets without a local partner. A storm of populist fury forced New Delhi to pull back a parallel proposal that would have allowed multi-brand retailers, like Wal-Mart, to open retail outlets with local partners. "We never considered 51 percent," Culver said. "When we looked at the opportunity to enter India, understanding the complexities of the market and the uniqueness that is India, we wanted to find a localbusiness partner." Starbucks currently operates over 17,000 stores in 57 countries. Its India venture will face competition from existing players like Cafe Coffee Day, which dominates the market.

Technopak founder Arvind Singhal said India's flourishing cafe culture has less to do with coffee than a social need for clean, safe gathering places for young and old alike, who often live in cramped quarters. "India doesn't have too many places for people of any age to just go out," he said. "It's not about a coffee culture. It's a gathering place where people can sit and meet." He added that Starbucks' entry, however much delayed, is likely to fan competition and speed the proliferation of coffee shops. It could also help boost flagging investor confidence in India. "It's almost like an endorsement that India's still a good story," he said.