KS: Delivering Customer Service

Richie Bhattarai

Introduct ion Objective:

To establish Starbucks as the most recognized and respected brand in the world Year 1971 : Starbucks was established Year 1982: Schultz joined Starbucks marketing team Year 1987 : Schultz acquired Starbucks Year 1992: 140 stores in the Northwest and Chicago and was successfully competing against small scale coffee chains. Raised $25 million through public offering

Introduction ( Contd ..)

Year 2002 : Dominant specialty coffee
brand in North America

Sales risen at a CAGR OF 40% Net earnings increased AT CAGR of 50%

Over 5,000 stores around the globe serving 20 million unique customer Opening on an average 3 stores a day

Spent minimal dollars on advertisement

Factors Behind The Success Of AStar Vision : Bucks Clear

- Starbucks to be Americas third place

Inviting atmosphere Good Leadership

Mission / Objectives : To establish Starbucks as the most recognized and respected brand in the world Strategy :
- Consistency in Quality through Backward Integration - Integration - Excellent Service
- Partner Satisfaction -

Anywhere , everywhere , goodc offee ontherun

Reach Product Variety New concept low competition Focus: Starbucks was Customer successful because it placed value to the customers first in its value proposition

Diksha Singh

Positioned as most recognized brand

Until 2006 , Starbucks was leading roaster and retailer of specialty coffee - ROR was 31 % while industry average (S&P) was just 10.2% - Earning grew by 36% p.a.

Schultz left the positio n of CEO

- Introduces the Starbucks Card - Licensing agreements ( national Fair trade )

Opens first Farmer Support Center

Launches paper beverage cup

2000

2003

200 4

200 6

After 2008 , drop in Starbucks position due to global recession - ROR was 23 % while industry average (S&P) was just 7.4% - Earning continued to grow by 30% p.a.
- Stock price up by 165 % from 2009 ( $8 . 27 to $21 . 91 ), outperforming the S & P 500 return of 56 % . -Launches Ready Brew Coffee . -Increase in profit more than eightfold -World s largest buyer of Fair Trade Certified due to high coffee . customer s -Opens Starbucks Farmer participation Support Center -Additional lower -Most engaged brand in calorie options to social media meet the need of the customers . - Offers free Wi - Fi nationwide 2009 2010

- Schultz returns as chief executive officer . - Acquires Coffee Equipment Company - Launches MyStarbucksI dea . com 2008

- Expand in China at a rapid rate - Offers Seattle s Best brand in Subway and Burger King fast - food restaurants . - Forecasted growths in 2011 are around 16 % with 18 % growth in 2012 . - Offers mobile payment apps , e - gifting on its Face book page . - A new store design in addition to the company s new log which no longer includes the company s name . - Signs MoU with Tata Coffee for Strategic Alliance in India - Enters into strategic manufacturing , marketing , distribution and sales relationship with Green Mountain Coffee Roasters , Inc . - Recent news in on Starbucks to take over its one of the major competitor , Peet's Coffee & Tea Inc ( PEET . O )

2011

1971

1987

1992

2011

Bishal Bhattarai

SWOT Analysis
Strengths

Product Innovation Established brand name Top 50 fortunes worlds most admired companies list Retail Expansion Being a brand associated with the specialty/gourmet coffee

Weaknesses
Overly dependent on a single product line as a competitive edge Many outlets has been closed Strong presence in US only Ignored internal assessment

Opportunities
Eight states in US without single company operated Starbucks Co-branding with other companies Increase in coffee consumption Emerging international market/countries

Threats
Company image of caring money only Emerging competitors Customers bargaining power Consumer trends of being health conscious

Bikash Shrestha

Recommendations
Maximum emphasis on customer satisfaction Should try to promote and increase the use of storedvalue card (SCV) Needs to be environmental friendly and decorate the stores environmentally

Recommendations ( Contd ..)

More emphasis on Advertising and Promotion Focus on the Coffee More emphasis on Product Innovation rather than lowering price

Thank You