Post on 04-Jun-2018
8/13/2019 GURILEM Starbucks Final
1/40
DELIVERING CUSTOMER SERVICE
8/13/2019 GURILEM Starbucks Final
2/40
GURILEM
Rany Reza Deru Joddy
8/13/2019 GURILEM Starbucks Final
3/40
VIDEO INTRO
8/13/2019 GURILEM Starbucks Final
4/40
1971
Founded byBaldwin,Bowker, andSiegl
1982
HowardSchultz joinedthe marketingteam
1988
Owned bySchultz
1992
Went public
HISTORY
8/13/2019 GURILEM Starbucks Final
5/40
VISION
To be the third place
8/13/2019 GURILEM Starbucks Final
6/40
Product
Highest qualitycoffee from Asia,Central & SouthAmerica, Pacific
Merchandise
People
Service frompartners (barista)
Customerintimacy
Our goal is tocreate anupliftingexperience
Place
The atmosphere
The aroma
Interior, invitespeople to linger
Building a senseof community
Creating experience
BRAND STRATEGY
8/13/2019 GURILEM Starbucks Final
7/40
PRODUCT
8/13/2019 GURILEM Starbucks Final
8/40
77%
13%
6%4%
Coffee Beverages
Food Items
Whole Bean Coffees
Equipments &Accessories
SALES
(2002, North America)
8/13/2019 GURILEM Starbucks Final
9/40
DISTRIBUTION CHANNEL
Office Retail Campus
8/13/2019 GURILEM Starbucks Final
10/40
Small-scale SpecialtyCoffee Chains
Regional
Differentiation onstore environment
Independent SpecialtyCoffee Shops
Wide range of food
and beverages Satellite TV and
internetconnection
Donut & Bagel Chains
Different product
offerings Coffee as
complementaryproduct
COMPETITION
8/13/2019 GURILEM Starbucks Final
11/40
PeopleRetail
ExpansionProduct
InnovationService
Innovation
KEY SUCCESS FACTORS
8/13/2019 GURILEM Starbucks Final
12/40
Partners = barista
17-23 years old
Generous policy
Health insurance
Stock option
Lowest turnover rates(only 70%)
Knowledge sharing
All senior executives had totrain and succeed asbaristas
PEOPLE
8/13/2019 GURILEM Starbucks Final
13/40
TRAINING
HardSkills
SoftSkills
Partner
8/13/2019 GURILEM Starbucks Final
14/40
Partner satisfaction leads to customer satisfaction
The success of a new beveragedepended on partneracceptance
recognizingregular customers and providingpersonalizedservice
PARTNERS
8/13/2019 GURILEM Starbucks Final
15/40
Become the most recognizedand respective brand in the
world
Ultimately have 15,000international stores
RETAIL EXPANSION GOALS
8/13/2019 GURILEM Starbucks Final
16/40
The rising of coffeeconsumption in US
109 million people in USnow drank coffee everyday
The markets biggest growth
to drinkers of specialtycoffee
Coffee consumption tookplace outside of the home
Still 8 states in US without
specialty coffee shop The business was far from
reaching saturation levels inexisting market
OPTIMISTIC GROWTH PLANS
8/13/2019 GURILEM Starbucks Final
17/40
38%
62%
Market share of Specialty
Coffee in US (2000)
Starbucks
Others42%
58%
Market share of Specialty
Coffee in US (2002E)
Starbucks
Others
50%50%
Market share of Specialty
Coffee in US (2005E)
Starbucks
Others
8/13/2019 GURILEM Starbucks Final
18/40
Area demographic
Coffee consumption
level
Competition
intensity
Real-estate
availability
SELECTING RETAIL SITES
8/13/2019 GURILEM Starbucks Final
19/40
*Tinkered
withproduct
formulation
Ran focusgroup
Conductedin store
experimentMarket test
NEW PRODUCT DEVELOPMENT PROCESS
8/13/2019 GURILEM Starbucks Final
20/40
Ergonomic flow of operation
Handcrafting speed
Partner acceptance
NEW PRODUCT SUCCESS FACTORS
8/13/2019 GURILEM Starbucks Final
21/40
SERVICE INNOVATION
8/13/2019 GURILEM Starbucks Final
22/40
No unifiedmarketing
department
Shiftingbrand image
amongcustomers
Decliningcustomer
satisfaction
MAIN PROBLEMS
8/13/2019 GURILEM Starbucks Final
23/40
PotentialNew
Entrants
Substitutes
BuyersBargainingPower
SuppliersBargainingPower
COMPETITION
8/13/2019 GURILEM Starbucks Final
24/40
New Entrants
Low barriers toentry
Generic product
Costly in fastretail expansion
Different pricingstrategy
Substitutes
Varioussubstitutes ofcoffee (tea,beverages,
candies)
Low switchingcost
Lower priceoffered
Healthy issues of
coffee
Buyers
Low switchingcost
Many otherchoices for coffeeproducts
Price sensitivity
Searching fordifferentatmosphere
Suppliers
Many suppliersfor qualifiedcoffee
Low switchingcost
Volume-basedpurchasing(volume isimportant tosupplier)costrelative to totalpurchase
Marketdetermines thecommodity price
COMPETITION ANALYSIS
high high high
8/13/2019 GURILEM Starbucks Final
25/40
The market is still far from saturation Starbucks is not a single-player
Drinking coffee becomes part of life-style
Opportunity for product differentiation
HIGH INDUSTRY ATTRACTIVENESS
8/13/2019 GURILEM Starbucks Final
26/40
8/13/2019 GURILEM Starbucks Final
27/40
The combination of those competencies are
difficult to imitate by competitors
CORE COMPETENCIES
Product People Place THEBRAND
8/13/2019 GURILEM Starbucks Final
28/40
No Chief of Marketing Officer
3 separate groups of marketing department
gather and analyze market data
develop new products and manage the menu andmargins
develop the quarterly promotional plans
Everyone has to get involved in a collaborative
marketing effort
LACK OF STRATEGIC MARKETING DEPARTMENT
no one was really looking at the big picture
8/13/2019 GURILEM Starbucks Final
29/40
SHIFTING CUSTOMER PERCEPTION ON BRAND
Customer-Oriented
Everywhere
Good coffee onthe run
Place to meet
and move on Convenience
oriented
Accessible andconsistent
Capitalist
Starbucks
cares primarily
about money Starbucks
cares primarilyabout buildingmore stores
8/13/2019 GURILEM Starbucks Final
30/40
Affluent
Well-educated
White-collar
24-44
Younger
Less well-educated
Lower income than
established customers
Visited the store less
frequently
THE CHANGING CUSTOMERS
establishednewer
8/13/2019 GURILEM Starbucks Final
31/40
Baby Boomers(1946-1964)
Work-centric
Independent Goal-oriented
Competitive
Generation X(1965-1980)
Individualistic
Tech-adapt Flexible
Value work-lifebalance
Generation Y(1981-2000)
Tech-savvy
Family-centric Achievement-
oriented
Team-oriented
Attention-craving
legalcareers.about.com
CHARACTERS OF GENERATION
8/13/2019 GURILEM Starbucks Final
32/40
How could Starbucks make you feel more like a valued customer? %
Improvements to Service 34
Friendlier, more attentive staff 19
Faster, more efficient service 10
Personal treatment 4
More knowledgeable staff 4
Better service 2
Offer better prices/incentive programs (total) 31
Free cup after X numbers of visits 19
Reduce prices 11
Offer promotions, specials 3
Other (total) 21
Better quality/variety of products 9
Improve atmosphere 8
Community outreach/charity 2
More stores/more convenient locations 2
Already satisfied/Dont know 28
FACTORS DRIVING VALUED CUSTOMER PERCEPTION
8/13/2019 GURILEM Starbucks Final
33/40
THE IDEAL CUSTOMER
Generation X with this
demographic
College degree
SES AB
Regular/social coffee
drinker
Like to hang out after-
work
The reason Because the trend is
expanding to the
younger generation
more promising market
8/13/2019 GURILEM Starbucks Final
34/40
Faster service Internet service
Provide atmosphere supporting both relaxing &workingenvironment
Better price Membership
Special offerings
Discounts
TumblerCredit card
Special holidays
HOW TO SATISFY THE IDEAL CUSTOMER
8/13/2019 GURILEM Starbucks Final
35/40
Should Starbucks make the $40 millioninvestment?
Add moreemployees
Createinnovation incoffee making
process(coffee
machines)
Do storeImprovement
(interior &facilities)
Giveprivileges to
frequentbuyers
Maximize theuse of
databasesystem (sales& customer
profile)
THE QUESTION
Yes!
8/13/2019 GURILEM Starbucks Final
36/40
Adapt localcharacteristic /taste (ex : Mexican foodsmenu on South USA states)
Periodic researchinconsumer behavior &preferences
Retain customers bycontinuous promotionprograms (ex : free x after ydrinks)
Create eventsto promoteand engage customers-partners relationship (ex :coffee tasting)
RECOMMENDATIONS
8/13/2019 GURILEM Starbucks Final
37/40
Gen Y
College students
young office workers
Tech savvy
Linger for studying,
socializing, gathering
TODAY AT STARBUCKS
8/13/2019 GURILEM Starbucks Final
38/40
In service marketing, its important to monitor
changesthat happen in consumer demographic &
behaviorto create dynamic, up-to-date strategy.
Therefore, company can give better service. Customer engagement is the foundation taking
place in every service encounter. Therefore, it is a
mustthat thefront-line people represent thevalue and knowledge of the company at the best
level.
LESSONS LEARNED
8/13/2019 GURILEM Starbucks Final
39/40
VIDEO OUTRO
8/13/2019 GURILEM Starbucks Final
40/40