10/21/2021 Assignment #4 – Service and Sales GEPS 2018

Service and Sales GEPS 2018

Assignment #4
Publicado por KOTLER2018 el ABRIL 25, 2018
1. Try to identify the most relevant topics in chapter 4 that appear in this business case.

The existence of a core product and several supplementary service. Starbucks bases their activity in
provides a high quality coffees as core product and complement it with several supplementary
services such as deserts and other sweets products.

A product line that covers the entire range of products under the Starbucks logo and associated with
the premise of quality and customer service that professes the brand. Big part of their success
depends of the quality service that they provide instead of their products

A service of order-taking with whom the customer can access to differents discounts and benefits.
Another element that Starbucks offers and that differentiates it from other coffee chains is the offer of
a brand experience service based on a premise of exclusivity.

The New Service Development adopted by Starbucks It also allows us to clarify the good harmony
between the image of the market and the aspirations of product quality and service that the company
aims to obtain.

Starbucks Business case

Apply the flower of service model to this business case. Describe the flower model: core and
supplementary components.

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Information: Starbucks manage several channels to keep their customers informed about their
products and services, their main channels are their web page and the application, this channels give
information opening hours. careers, locations,, products,corporate responsibility, coffee products and
how to prepare the best coffee.

Consultation: Starbucks offer training and inspirations to their employees regarding the service they
need to offer, this include coffee knowledge, how the beverages should be prepared and how is the
customer intimacy is needed to fulfill the Starbucks culture.

Order Taking: Starbucks offer a membership card so that customers can accumulate points after their
purchase and receive extra products, they also offer a broad menu with a wide variety towards food
and beverage, their order wait delivery consist in writing your name and within 5 mint your order
will be ready.

Hospitality: Their cafes usually include restrooms, tables and some sofas with magazines and some
coat rackets, they also have some add ones where you can have some sugar, napckings, and different
toppings and they offer security system with cameras in their shops.

Safekeeping: The maintenance of Starbucks is very good, they keep their cafes clean, the counter is
always organize, there is a self.cleaning system were usually customers clean their tables, but if some
customer don’t clean there is always someone keeping the service quality.

Exceptions: Starbucks offer in their web site a part for complains and suggestions, complains usually
are made presencialy in their shops, which have a quicker response, they also provide information
about ingredients and food allergies that customers must be aware

Billing/Payment: Starbuck manage their billing process quite standard, the have digital terminals
that connects directly with the financial transaction, invoice are generated after the payment.

Which is the branding strategy that Starbucks is following?  

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Starbucks wants to achieve maximum recognition. They not only strive to ensure that the client
knows what the company is doing, but also strives for a brilliant image. Through the 4P analysis we
can see clearer on what aspects Starbucks makes its emphases and what makes Starbucks brand that
recognizable.

Product – Company always emphasizes that all their coffee drinks are made from grains that meet
strict ecological, economic and social quality standards. Starbucks established a strong and profitable
competitive advantage of its product line by broadly differentiating coffee and the related products.
In addition to the existing 30 types of coffee beverages, Starbucks has expanded its range and now
offers cakes, salads, various sandwiches and yoghurts. In order to reach a larger audience, company
began to sell tea drinks, so now not only coffee lovers can enjoy the Starbucks atmosphere and
quality products. Accordingly, the product line expanded through the introduction of innovative
products such as “Frappuchino”, “Wild sweet orange” tea, “Tazo” tea and others. Moreover,
Starbucks tries to adopt its product range to every marker they want to enter.

Moreover, individual approach is an essential component of Starbucks strategy. “Latte for Arina!”
shouts out in a coffee shop. I approach the counter and take a glass of coffee on which my name is
written. It is a trifle, but you feel needed. This famous trifle in many ways created a cult image of
Starbucks as people are attracted by the brand’s personal attitude, even such simple and
unsophisticated.

Price – Starbucks products price positioning comes out from the following “high quality at a
moderate cost.” Nevertheless, the company’s pricing strategy is to set higher prices for the product
than those of competitors to impart an image of elitism. Starbucks products are more expensive than
competitors because the perception of the company’s products is represented as high-quality and the
best. Starbucks maintains strict quality control of its coffee as well as customer serving.

Place – in 1994 Starbucks set a new goal for itself: “to approve Starbucks as the world’s leading
supplier of high-quality coffee, preserving its commitment to its uncompromising principles as it
grows and develops.” Starbucks always searches for very well-viewed and high-traffic areas for new
coffee shops locations and rely on the three main factors: demographic, financial indicators and the
potential of the brand. As soon as client sees the mermaid logo he knows what to expect: soft
armchairs, free sockets for use or computer recharging, wireless Internet access etc. The company
realized that people come to its coffee shops not just for coffee, but for something more – for a special
atmosphere. People communicate with each other, read, learn, and listen to music while they drink
coffee. Knowing this, coffee shops try to make their outlets more or less unique to create this special
atmosphere. Starbucks focuses on a large number of comfortable places for sitting that disposes
people to stay longer than they expected.

Promotion – Starbucks did not compete for the audience on media channels. Therefore, for each new
market, they usually plan at least one big event to celebrate their appearance and then transfer the
funds to charity. For example, after September 11 at Starbucks coffee houses in New York,
Washington and Pennsylvania for rescuers coffee was brewed for free. This type of promotion allows
Starbucks to strengthen the image of the company as well as inspire and attract both potential and
visiting visitors.

Since 1993, Starbucks has been producing flyers that give customers the right to free half a pound of
coffee as soon as they embark on a round-the-world trip to taste coffee from different parts of the
world. In some other cities, Starbucks invites people to try five different drinks, after which the visitor
was offered a free mug. Starbucks always has printed materials that contain information for those
who want to know more about coffee. Company also promotes various Starbucks cards: from

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Starbucks Card eGift to Starbucks Rewards. When a customer buys gift cards, he not only shows
loyalty to the brand, but also provides the company with free advertising and brings new customers.
While Starbucks Rewards allows you to keep regular customers from encouraging them and
reinforcing your brand. Starbucks also provides cards for corporate sales that are used for various
awards, for example to show the employee appreciation for a well done job or it is given as a gift to
the customer or supplier.

Another important fact of Starbucks’ positioning is that the company protects the environment. While
other suppliers are positioning themselves in a similar way, no one does it on a scale similar to
Starbucks. Buyers and customers pay attention to those companies that actually help the
environment. Starbucks advertising strategies were also one of the key factors. The company found
that advertising on a local scale is much more effective than nationwide. Most of the company’s
advertising materials are distributed in printed form, since the target market of the company is
educated people who read more than the average person.

Take a look at the doc “Starbucks Corporation Full Case Study” (References) Can you improve the
business case incorporating the 3 additional P for services?

Process – Install self-serve kiosks (figure 1) like many McDonalds are already doing.  This could
speed up the people processing of the customers. They should also include the complete product line
of Starbucks and also incorporate an option for the clients to custom-build products adjusted to their
individual likings

Physical Environments – build the interior of Starbucks stores according to a standardized design. If
all stores are more or less similar in interior appearance, the customer might feel more comfortable
because he/she is acquainted with the place and it feels familiar to him/her. Since the Starbucks
stores are the flagships of the brand, they should also make sure that their stores, including the
restrooms, are always tidy and clean as this additionally increases the customers’ perception of the
quality of the brand.

People – The positive interaction between the customers and the employees is of crucial importance
for customer satisfaction. In order to further improve this, Starbucks should provide customer service
training for their employees. They could also go one step further and train their employees to be
coffee specialists which would enable them to counsel people about the different beverage options.
By this, they could assist them in choosing the most fitting product for them.

3.  Nespresso Business case

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Apply the flower of service model to this business case. Describe the flower model: core and
supplementary components.

The flower of service model differentiates between the core service/product and supplementary
services. The supplementary services are again separated into facilitating and enhancing
supplementary services. In the center of the flower is the core service/product of the business which
in case of Nespresso are the coffee capsules and the coffee capsule machines. This core is surrounded
by the outer petals or leaves of the flower. Each petal represents one of the supplementary services
(see picture below).

The detailed description for the supplementary services of Nespresso are listed in the table below.

Supplementary services:

Facilitation supplementary services Enhancing supplementary service

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Information

· 6600 customer-facing Nespresso

specialist that can help and advice
on anything
· Store maps signs (machine gallery,
tasting area, grand crus)
· 24/7 global online boutique
· Global network of Customer
Relationship Centres – on call
Nespresso coffee specialists 24/7
· Personalized advices providing
technical assistance
· Electronic queuing system inside
the store
· Confirmation of order placing via
email and phone
Consultation
· Coffee Room inside the boutique allows to enjoy coffee
tasting with a specialist
· All the specialist pas through  training programs in order
to be able to advice on coffee or machine selection and now
how to service the customers
· Detailed description of each type of capsules on the
website
· Online-chat or FAQ options available via website
· Machine repair service
· Different programs for professionals, clubs and
sommeliers
· Recipe suggestions, Nespresso accessories and special
orders for club members

· A tracking number allows you to

check the status of your parcel
anytime

Order-taking

· Nespresso Membership Club and

mobile phone applications
Hospitality
· Around –the-clock order-taking
· Orders can be placed by toll-free, · At the entrance of a bounties there is always an assistant
telephone, email or over the Internet and security that will greet you and will help with the right
· After prompt standard delivery direction
within two business days or pick-up
· Boutiques have a great and modern design
point
· Staff wears black and white uniform
· In-store pick-up option within few
· Guest Wi-Fi service
hours
· At the end of the purchase a cup of coffee is always
· Self-service for Club members
offered
inside the stored
· By placing an order once via the
online boutique the system will
remember your preferences

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Billing

· Fast billing process with printed Safekeeping

invoice when buy in the store
· Parking for vehicles
· Via online store e-receipt and then
· Security in each shop
printed invoice inside delivery
parcel

Payment

·       Invoice
Exception
·       Credit Card
· Return in original condition and packaging within       14
        Visa | Master Card days after receipt of the order
        AMEX | Diners Club · Offer the highest quality and most sustainable portioned
·       SEPA coffee worldwide
·       Nespresso Gift Card · Capsule recycling collection system in-store
·       Automated check-out system in
store
·       Cash payment

Which is the branding strategy that Nespresso is following?

Nespresso, like Starbuck, is basing its differentiation strategy on two main elements. The first is to
develop a quality brand image that provides customers with an element of differentiation from the
competition. This quality is linked both to the product itself and to the experience of acquiring
Nespresso products.

The access to shops is already showing signs of quality, as both the infrastructure and the treatment of
the sellers reflect a higher status than the rest of the coffee capsule purchasing chains. In addition, the
online service provided by Nespresso is also a differentiating element as it meets high quality and
efficiency standards in the delivery of high quality products.

On the other hand, Nespresso’s brand strategy is based on the development of experience through
the existence of elements such as the Nespresso Club or the magazine, elements through which the
customer has a perception of purchasing products such as coffee and machines but also
complementary services associated with them that demonstrate higher quality indices than the rest.

In short, Nespresso’s differentiation strategy is based on developing a brand development strategy

under the premises of quality.

Can you improve the business case incorporating the 3 additional P for services for Nespresso?

Process: Nespresso can improve their processes by having different channels to their business model,
they can implement more partnerships with restaurants and airlines to offer their products as
complements to other services and have a bigger approach to the market.

Physical environment: Nespresso can implement a coffee shop like Starbucks, where people can
experience the Nespresso experience and enjoy their products, we think that adding this to their
services will increase their customers experience by being able to have a physical space where they
can try all their different product portfolio.
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People: Regarding the people, we think nespresso can improve their business model by sharing their
knowledge with the customers, they have a section in their web page where they explain the different
types of coffee, but having special workshops of sharing all the knowledge behind coffee can give
Nespresso more customer intimacy and enhance their membership club with more services.

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