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Rationale Became profitable in the 1980s and hasnt stopped ever since

It is the 5th largest name in the fast-food industry according to Forbes, 2014.

With more than 26,000 stores in 72 countries

5000 stores to more than 15,000 stores in a span of 10 years

Studying a brand this vast is a fascinating opportunity.

Brand Profile Starbucks Corporation - an American global coffee company based in Seattle, Washington

Found in 1971, was a roaster and retailer of whole bean and ground coffee, tea and spices with a single store in Seattles Pike Place Market.

President and CEO - Kevin Johnson

Today, connect with millions of customers every day with exceptional products and more than 24,000 retail stores in 70 countries.

Source: Starbucks.com

TIMELINE

1971Present

1971Starbucks opens first store in Seattles Pike Place Market.

1982Howard Schultz joins Starbucks as director of retailoperations& marketing

1987Il Giornale acquires Starbucks and changes its name to Starbucks Corporation

1991Becomes the first privately owned U.S. company to offer a stock option program

1995

Begins serving Frappuccino blended beverages.

Launches Starbucks VIA Instant

2009

201724,000 retail stores in 70 countries.1987

2011

1971

1992

Source: Starbucks.com

MISSIONTo inspire and nurture the human spirit one person, one cup and one neighbourhood at a time.

Key components:Inspire and nurture the human spiritOne person, one cup and one neighbour at a time

Source: Starbucks.com

Geographical Approach

With more than 24,000 stores in 70 countriesSource: Starbucks.com

As of April 2016, Starbucks operates 84 outlets in 7 cities of IndiaState/RegionCityNo. of OutletsFirst outletDelhiNew Delhi1824 January 2013Delhi NCRGurgaon610 July 2013MaharashtraMumbai2619 October 2012Pune98 September 2013KarnatakaBangalore1022 November 2013Tamil NaduChennai58 July 2014TelanganaHyderabad51 October 2014

Organizational StructureStarbucks has a matrix organizational structure.

Hybrid mixture of different features from the basic types of organizational structure.

Main features of Starbucks organizational structure:Functional structureGeographic divisionsProduct-based divisionsTeams

panmore.com

Types of merchandise DrinksCappuccinoEspressoNon coffeeFrappussino

FOODSandwichPastry/CakesMuffinsCookies

AccesoriesMugsDrinkwareCold DrinkwareMachinesAccessories

Variety of products

PricingStarbucks uses Value based pricing strategy. They increase 1% price, which raises the profits by an average of 11%.

Service offeredPerforms as a hybrid organization Both- a consumer service provider as well as a tangible finished goods manufacturer.Range of service offered:

Clean storeCustomized coffeeConvenient locationTreated as valuable customerFriendly staffCoffee taste/ flavorHighest quality coffeeFast service

Appropriate pricesFreshest coffeePleasant ambienceKnowledgeable staffPlace to relax, meet friendsInvolved in the communityWide selection of non coffee beveragesNew, innovative beveragesGood selection of merchandise

Size of the storeThe average size of a stand alone and mall outlet of Starbucks can vary from 3000-3500 sq ft.

However, there are smaller formats around the world like drive throughs and airport cafes with area aorund 1000-2000 sq ft.

Size of the store (INTERNATIONAL)The average Starbucks store size varies depending on urban versus suburban location.

Biggest Starbucks Store: The Willy Wonka Factory Of Coffee, Seattle(15,000-square-foot)

Smallest Starbucks Store: Espresso shot, New York City(500 square feet)

Store DesignSustainable design and build methodologies are part of our DNA.Each store uses one of four design concepts:Heritage ArtisanRegional Modern Concept

Visual MerchandisingDim lighting, focus lights close to tables and product displays, brighter lighting behind the counter.

Separate column for the brand merchandise.

One big fixture has food displays, payment area and the delivery area, rest of the store for sitting.not very consistent with the themes

Connaught place store has a very rusty and wooden feel whereas the pacific mall outlet feels like a proper restaurant.

Choice of locationStarbucks, finds locations where there is enough traffic to support running the business.

Sophisticated off-the-shelf tools, find traffic patterns, income in the area, all sorts of demographic and psychographic information.

In India,Found in High Streets and Malls for upper section of society, due to their relatively high prices.

BasisStarbucks GK1,MblockStarbucks Pacific MallLocationHigh StreetMallSquare Feet Area1500 Sq ft3700 Sq ftNumber of Employees10 overall5 OnDuty14 Overall8 On DutyVariety Of Merchandise Starbucks offer a rage of products like Coffee, Handcrafted Beverages, Merchandise and Fresh Food . Starbucks offer a rage of products like Coffee, Handcrafte dBeverages,Merchandise and Fresh Food.Timing9am- 12am10 am -10pmPricingThe Menu of Starbucks is same all over India hence the pricing is sameThe Menu of Starbucks is same all over India hence the pricing is sameStore LayoutFree FlowFree FlowCustomer ServiceThe service was fast .Friendly Employees and the customers were completely satisfiedEmployees were humble and fast. Every customer was attended to carefullyVisual Merchandisingstore was like other high street outlets i.e simple and Modern .The windows were big and a lot of sunlight was coming in .The Siting had Sofas , chairs and tall chairs . set up like a restaurant than a to-go coffee place. The windows were big and there was a lot of sunlight coming in The walls, lamps and stools gave a very wooden-earthy feel to the outlet.

Comparison of stores

Advertising StrategiesModes of Advertising:

Radio TV Billboards Parties Big, Juicy Paintings Nationwide Coffee BreakPublic Performances Charitable Contributions Green initiatives

Starbucks in Movies(Above the line)

Devil wears Prada(2006)Fight club(1999)Sex and the city (2008)

Social networking sites(on the line)37.32million Facebook likes6.56 million Twitter followers2.98 million Instagram fans2.86 million Google+ followers160K Pinterest followers32K YouTube subscribers

Print media and TV commercials(Below the line)

Campaigns(Above the line)

Howard Schultzlaunched My Starbucks Idea in 2008 to help increase the companys focus on the customer and what they want.

In 208, Starbucks Coffee Company and (RED)TM announced a multi-year partnership, a portion of the proceeds from STARBUCKS (PRODUCT)RED products will go to the Global Fund to help save lives in Africa.

In 2011, As part of its long-term dedication to the relief and recovery efforts following the devastating earthquake and tsunami that struck Japan

Sales PromotionLoyalty cards

Customization of outlets for comfort.

Local touch to caf like copper in Pune, handcrafted fabric in Delhi.

Regular addition and subtraction to menu.

Digital connect with consumers.

Personal sellingFree sampling of new products to customersSending of newletters

EventsStarbucks brings mobile payment to India with the launch of the mobile app. 15 March 2017

Starbucks unveils a modern tea experience with the debut of Starbucks teavana in India. 18 January 2017.

Tata Starbucks announces five-day work schedule. 2 May2016

Tata Starbucks Leadership changes. 17 December2016

Tata Starbucks hosts thefirst coffee championship in India. 27 August2015

The Tata group and Starbucks coffee company strengthen global partnership with multiple new commitments. 27 June2016

Public RelationsStarbucks took the advantage in the social network craziness by positioning itself in Facebook and Twitter.

-Starbucks has penetrated the smart phone industry by being part of Blackberry, iPhone and Android applications.

-To stimulate the interest of its customers, Starbucks initiate My Starbucks Idea (www.starbucksidea.com) for customers to share their ideas and Flickr to share pictures.

ADVERTISING

The campaign #MyMood#MyStarbucks asks consumers to share their mood and what beverage suits their mood best to receive two free customizations on their next visit.

SALES PROMOTION

My Starbucks Rewards, customer loyalty program is an effective tool to implement most sales promotion initiatives in practice.

PUBLIC RELATION

Starbucks totally involves themselveson Facebook, Twitter, mobile application, online partnerships

DIRECT SELLINGEmployees are well trained in providing advice and information about the products. They also know how to build a relationship to each customer in a individual way.Samples of new drinks launched are distributed to try the flavour .

PERSONAL SELLING

Starbucks keeps on updating their loyalty customers with emails ,messages and letters

INTEGRATED MARKETING COMMUNICATIONPLEASE REFER TO THE RETAIL MIX FOR DETAILED INFORMATION OF THE ELEMENTS OF IMC.

Perceptual Mapping

High Quality Coffee Low Quality Coffee Good Environment of the StoreBad Environment of the Store

Brand identity prism

Physique:Green&White logoWide range of coffeePersonalised coffeeNames on the cups

Relationship:LoyaltyAdaptive ProximityFriendly

Personality:Quality OrientedTraditional

Culture:Socially Responsible Commitment Focus on Traditions& Relationships PassionReflection:Well Connected Finest Coffee Experience Productive

Self Image:Empowered Individual PassionateTraditionalWealthy

Picture of SenderPicture of ReceiverExternalisation

Internalisation

4 PsProductsTATA will supply premium Arabica and Robusta coffee to all stores.

Starbucks exclusive, innovative packaging will be used to keep the coffee hot for a longer time.

They have a variety of flavours in hot and cold coffee.

They also offer customization of the coffee as per the customers

There is also a variety of tea available along with a number of eatables like cake and bagels.

PriceThe prices are relatively higher as compared to competitors.

The premium pricing aims at creating a rich brand image.

Place

With 73 stores in almost 5 years

Most of the stores have been located in malls and airports

Their main criteria for store locations is footfall or highly trafficked streets

PromotionThe brand is not as big when it comes to promotion. They are not seen on the big screens or television.

They engage more with their customers

They also focus on digital media

My Starbucks Reward Program is a loyalty program that allows customers to redeem points that they earn from buying their products

Website of Starbucks Coffee Company has a lot of visitors and customers can get information easily.

Facebook page of starbucks india has more than 8 lacs likes and is very responsive to their followers.

Twitter handle of Starbucks India more than 55K followers and people are constantly engaging with the twitter handle

Starbucks Experience is a phrase they use to market themselves. They promise to offer a delightfulexperience with high quality coffee. The phrase markets itself through word of mouth mostly by the loyal customers

Innovative LED display:

Before opening their first store in Delhi, starbucks placed a big screen outside the stores space. The screen flashed tweets by people who truly love coffee and starbucks in real time.

Partnership with Truly Madly

Starbucks partnered with Truly Madly, a dating app and hosted an event on the 13th of february, right before Valentines Day. they offered pre-loaded gift cards to winners of a competition from the event.

Business model

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