Business Policies and Strategies of Starbucks Coffee Company

Starbucks Coffee Company 

Starbucks Coffee Company has grown to become one of the biggest coffee house enterprises in the world. The company boasts of several strengths that have enabled it to stay competitive in the market. The company emphasizes on specialty coffee products that are aimed at enhancing customer experiences. The company constantly seeks to grow its market share by venturing into new markets ( Taecharungroj, 2017 ). The company has also focused on penetrating new markets, as well as offering products to customers drawn from different market segments. Additionally, the company has adopted a sustainable and responsible sourcing policy that is geared towards differentiating the company’s products from those of the competitors (Wen, 2016). While competitors focus on reducing prices, Starbucks Coffee emphasizes on providing a warm, friendly, and ambient environment that people enjoy. The company has also invested a lot in the innovation of its product mix in order to meet the ever-changing customer needs. 

Mission Statement 

Starbucks Coffee’s mission statement does not even have anything to do with coffee, like many other coffee chains. The mission of Starbucks is “To foster great social connections by creating lasting memories”. The mission statement implies that the company’s brand focuses on building more impactful ideology. The mission statement will eventually promote the establishment of a warmer company culture that places significant importance on meaningful social connections. The company will endeavor to create an ambient environment that will support creation of meaningful and impactful social connections among customers. The company targets customers who wish to share great moments with colleagues and loved ones. 

Vision Statement 

Generally, the primary focus of any vision statement is to help brands navigate the often challenging market conditions. This explains why some of the organizations may alter or modify their vision statements over time. Starbucks vision is “To make Starbucks a strong global brand providing quality and memorable customer experience”. The vision statement outlines the company’s strategic direction. The company aims to become the leading brand globally in terms of providing quality and memorable customer experience. The vision statement does not mention coffee anywhere. This is meant to allow the company to pursue diversification strategies in order to increase its revenue streams. 

Goals and Objectives 

Specific, measurable, achievable, realistic, and time-bound goals and objectives form the basis of successful businesses. Goals and objectives not only clarify the purpose of the business, but also help in identifying the necessary actions. The goals and objectives of Starbucks include growing the number of stores, elevating the coffee experience, driving the demand for at-home coffee, and extending digital engagement. 

Increasing the Number of Stores 

Starbucks seeks to increase the number of its stores by 12 percent in the next three years. This will help the company to expand its footprint around the globe. The company will focus on establishing stores in the outer edges of urban and sub-urban areas, particularly in densely populated cities like New York, Seattle, and Boston. This will improve Starbuck’s store penetration. However, much focus will be on overseas markets, as the company is facing the threat of cannibalization. 

Elevating the Coffee Experience 

Starbucks will offer highly customized and elevated experiences in order to position itself as the most preferred coffee shop worldwide. On top of its current offerings, the company will introduce Roasteries and Reserve Stores. The Roasteries will be targeted at premium customers who desire different types of coffee experiences such as clover, pour-over, and siphon. The Reserve stores will have double the square footage of a normal store. The company intends to establish 200 Roasteries and 500 Reserve stores in the next three years. 

Driving the Demand for At-Home Coffee 

Starbucks will establish the consumer good department that will help in driving the demand for at-home coffee. By partnering with companies such as Pepsi, the company will be able to expand it ready to drink coffee segment. The strategy is expected to increase company revenue by 5 percent in the next three years. 

Extending Digital Engagement 

The company plans to extend its digital engagement. The company is set to increase its mobile transaction by 50 percent in the next four years. This will promote a seamless digital experience for customers, hence increasing customer satisfaction. The company also intends to launch digital marketing through a smart phone app. The customers will be able to make their orders and payments online. The digital platform is expected to account for 30 percent of the company’s transactions. 

Industry Analysis 

The fast food industry plays a significant role in the global economy. The companies in the industry are required to comply with country specific legal and political requirements. However, hygiene and quality regulations vary significant across countries. For instance, the United States government requires firms in the industry to include calorie information on their products as a way of promoting healthy eating. 

The profitability of the individual firms primarily depends on efficient operations and effective marketing strategies. However, large companies like Starbucks have several advantages such as wide capital base and marketing capabilities. MacDonald’s leads the pack in the fast food industry followed by Starbucks. While the brand value of MacDonald’s is $126.04 billion, Starbucks has a brand value of $44.4 billion. Starbucks is followed by Subway at $18.77 billion. 

SWOTT Analysis 

Trends 

There are several important trends in the fast food industry that will influence business for Starbucks. The various trends include ingredient transparency and customer service. Customers are increasingly requiring firms to indicate the ingredients and their source. Thus, Starbucks has to indicate the ingredients on its products. This has been as a result of a focus on healthy eating. Customers are also concerned about the quality of service offered by firms in the industry. Poor quality of service affects sales negatively. As such, the company will focus on delivering quality and memorable customer experiences. 

Perceptual Map 

The perceptual map seeks to position the products in the minds of consumers relative to those of the competitors. It is a visual technique that shows how the average target market consumer views the positioning of the competing products. Price and quality will be the two determinant attributes used in the perceptual map. The map will assure the customers that they will get value for their money. The x-axis represents prices while the y-axis represents quality.

References 

Wen, S. (2016). Marketing strategies: Starbucks in China. 

Taecharungroj, V. (2017). Starbucks’ marketing communications strategy on Twitter. Journal of Marketing Communications , 23 (6), 552-571.