Case Study on Starbucks

case study on Starbucks
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This “case study on Starbucks” is about the journey to achieve the position they own today. 

It started when American coffee company and coffeehouse chain Starbucks has been at the top of its game for over years now. 

The brand needs no introduction after nearly five decades of ruling the coffee industry. 

Founded in Seattle in 1971, the company has established its foothold all over the globe and operates at 23,768 locations.

However, this cafe chain had seen its share of struggle through the course of becoming the best in the business. 

It was Howard Schultz’s wit and a business idea that nurtured the company into what it is perceived to be today.

 “Case study on Starbucks” starts with the aggressive expansion plan of Starbucks from the early years of Starbucks (1980) to the current year of 2020.

1. Starbuck in 80s to 90s

Under the leadership of Howard Schultz, Starbucks sought after an aggressive expansion in the late’80s and mid-’90s. When the organization opened up to the world in 1992, it had 165 Cafe.

After four years, Starbucks opened its 1,000th store including Japan and Singapore. 

Development was so aggressive that within a short period of time, only two years after, Starbucks opened its 2,000th Cafe.

2. Starbuck from 2000 to 2018

Consistent expansion plan helped Starbucks to achieve the first step of “Starbucks marketing strategy” and close deals all through the most recent two decades. 

Starbucks has had maintained its same-store deals development since 2010. 

The organization has now extended itself excessively far.

3. Starbucks in 2019

With more than 14,000 stores in the United States alone today, Starbucks has torn apart its own deals. 

The organization is pulling together and re-examining its extension. 

It is relied upon to screen 150 failing to meet expectations areas in 2019, three times the sum it commonly does.

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UNDYING COMPETITION AND NURSMEROUS COMPETITION                                        

starbucks Case studyStarbucks case study

“Case study on Starbucks” will not be completed without  a competitor’s analysis. 

Starbucks’ marketing strategy always added more chanter consistently. 

When Starbucks grew significantly within a span of 5 years, between 2000 and 2005, and its expansion plan supported by the fact that the number of stores in the US rose by 70% during that period.

This prompted other firms like McDonald’s and Dunkin’ Donuts to pick ideas from Starbucks and foray into the coffee market.

Starbucks marketing strategy

However, the journey to the pinnacle was not a smooth one as its alleged closest competitor, McDonald’s, targeted Starbucks with their advertisements for their high prices. 

To the dismay of the ardent followers of this specific coffee outlet, one of the hoardings by McDonald’s read “Four Bucks Is Dumb.”

ADDITIONAL ISSUES on the way to “Starbucks marketing strategy”

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The direct blow by McDonald’s was not all that Starbucks had to face as it was pulled down to the “middle spectrum” in order to make it compete with McDonald’s and Dunkin’ Donuts. 

In addition to this, the company also received competition from other high-end family-owned shops.

Apart from the constant competition, the rise in the price of the coffee beans in the 2000s also affected the business. 

This reduced the profit margin of Starbucks to a great extent. 

Moreover, the recession of the late 2000s forced the key Starbucks customers to cut back on their consumption.

STARBUCKS RISE

During such competitive a period, rethink and revive Starbuck’s marketing strategy and customer experience are the first two-step towards success. 

They serve millions of cups of coffee (and sugary ice cream shakes) each day. 

Yet, anyone can walk into any local Starbucks and another one an hour away and have the same experience.

1. NEW COFFEE CULTURE

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Starbucks gained momentum in the global cafe scenario mainly owing to their ability to distinguish themselves from other coffee establishments. 

Schultz made a revolutionary decision to bring Italian coffee culture to America and this apparently turned out to be the game-changer in terms of profits for the company. 

Also, Starbucks decided to use only high- quality Arabica Beans. 

To stand out in the market, the company decided to introduce signature sizes of drinks along with innovative coffee-based drinks.

2. CUSTOMER EXPERIENCE

Companies in every part of the world, irrespective of their target consumers, believe that customers are their company’s “most valuable asset”. 

Starbucks too prioritized the needs and wants of their target customers and ensured to deliver quality products and service to them. 

In this regard, the management decided to spend more on stylish interiors and give a sense of exclusiveness to the customers. 

Starbucks employees were given benefits as opposed to coupons in order to boost  productivity.

3. SOCIAL MEDIA STRATEGY OF STAR BUCKS:

The Success story of Starbucks started with massive followers on all the social media platform, Starbucks is the most loved Café worldwide.

SOCIAL MEDIA STRATEGY OF STARBUCKSSOCIAL MEDIA STRATEGY OF STARBUCKS

A) Followers on Facebook counted nearly 36.4 million. It is one the most sought out Café brand on Facebook.

Starbucks marketing strategy 2020

B) 11.7 million flowers on Twitter is proof of love and respect for one of the most creative brand.

C) 18.4 million fans on Instagram is the result of the unique social media strategy of Starbucks.

D) 261 thousand subscribers on YouTube can make jealous of any of his competitors.

Why Starbucks is so popular on Social Media Network

Starbucks’ marketing strategy is not completed without the new edge Digital marketing strategy of Starbucks. 

Starbucks realized the importance of Digital marketing and emphasizes it with innovative implementation planning.

1. Quality Content

Starbucks does follow the basic rule of 2/3 postings per day. Starbucks average posting rate is just 1. 

They do believe in quality content over quantity. Post engagement is more important for Starbucks. 

Starbucks’ focus is on knowledge, photos, and videos of customer experience.   

Inspiring videos is the strength of their social media posting.

2. Creativity in the content

Starbucks’ content is full of creativity with simplicity for its followers and fans to get engaged and motivated and feel fresh the same as after every sip of the coffee at Starbucks. 

Their captions are full of emojis, colors, and emotions which drive fans crazy to make posts viral.

3. Personal Touch

Starbuck social media strategy includes building  a connection with followers by responding to the comment on social media. 

Commenting and replying to fans make Starbucks more special.

4. Engaging Campaigns

Starbucks always believes in engaging campaigns. In 2018, Starbucks won the sliver IPA Effectiveness Award for social strategy. 

Here, Starbucks returned almost £4 in additional profit for every £1 invested. 

Since then Starbuck has started working on  a variety of strong social campaigning which contributes to continuing  the growth of Starbucks. 

Few popular social campaigns are like #UnicornFrappuccino #PumpkinSpiceLatte #Extrashotofpride #Redcupart.

Engaging Campaigns

#cloudmacchiato is the new Coffee by Starbucks. It is the coffee with light and airy with lawyers of fluffy foam. 

It is less liquid milk and fewer calories. Starbucks collaborated with Ariana Grande to introduce a permanent addition to its beverage menu. 

The two have teamed up to launch the Cloud Macchiato, a drink through a series of social media posts by the 25-year-old singer. 

Post went viral with 123 thousand likes and 21.1 thousand comments.

starbucks marketing strategy 2020Starbucks marketing strategy 2020

5. Customer Loyalty reward programs

In the Coffee industry, consumer behavior is greatly impacted by the level of attractiveness of loyalty programs that offer discounts and other advantages to loyal customers. 

Starbucks creates offers for their followers by using social media platforms. 

Users tag their friends and very soon it goes viral.

Back To Business

It was during the time of crisis when Howard Schultz re-joined Starbucks as the CEO in 2008 and made the necessary efforts to regain momentum. 

This “Case study on Starbucks” can’t be completed without innovative steps mentioned below to bring back the brand from low to high.

  1. Unique Social Media Marketing Plans
  2. Closing the least popular stores
  3. Cutting down the investment cost by laying off extra staff, most notably the top-notch executives
  4. Emphasizing on changing the face of the work culture of the company
  5. Teaching staff members to master the art of making better espresso
  6. Giving more power to its employees

Conclusion

“Case study on Starbucks” concludes by considering the records of the company in the past two decades, the company has grown significantly from being at $160 million in 1993 to reach $26.5 billion in 2019. 

This progress has been an outcome of its expansion across North America, Europe, and Asia.

Currently, the market cap of the company has swelled by nine times ($98.57Billion). 

Starbucks‘ market cap was $98.57 billion by the end of trading on Nov 1, 2019.

Starbuck’s marketing strategy started adapting to the dynamic business scenario has apparently worked out best for the company as they prioritized the satisfaction of their customers in order to build a strong customer loyalty base. 

“Case study on Starbucks” always depicts the rise and fall and then rise of the most loved brand in the world.

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Roshni bhure
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Roshni bhure

Great article on a great brand. thank you for sharing the valuable information for the coffee lover.

Raja
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Raja

thanks, sir for this valuable information about Starbucks. thank you for this amazing relevant information.

mayuri Choudhari
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mayuri Choudhari

Thanks, sir for sharing great description of the Starbucks. A really amazing article.