COMPANY PROFILE

Starbucks ’ history began in 1971 at a street in Seattle’s historic Pike Place Market. It
was here where Starbucks opened its very first store, which offered fresh-roasted coffee beans,
tea, and spices from around the world for their customers to take home. Starbucks’ name was
inspired by the classic tale, “Moby-Dick,” evoking the seafaring tradition of the early coffee
traders. Starbucks then expanded to Chicago and Vancouver, Canada, and then on to California,
Washington, D.C., and New York. By 1996, the brand crossed the Pacific to open its first store
in Japan, followed by Europe in 1998 and China in 1999. Over the next two decades, Starbucks
would grow to welcome millions of customers each week.

Starbucks is committed to the highest standards of quality and service, embracing the
heritage while innovating to create new experiences to savor. It takes many stakeholders in the
process of creating the perfect cup of coffee – from the farmers who tend to the red-ripe coffee
cherries, to the master roasters who create the best from every bean, and to the barista who
serves it with care. The employees – who they call partners – are at the heart of the Starbucks
experience. Therefore, the company is committed to making its partners proud and investing in
their health, well-being, and success, and to creating a culture of belonging where everyone is
welcome.

MISSION AND VISION STATEMENT

Mission
Starbucks mission statement is “to inspire and nurture the human spirit – one person, one cup
and one neighborhood at a time.”

Vision

To establish Starbucks as the premier purveyor of the finest coffee in the world while
maintaining our uncompromising principles while we grow.

GOAL AND OBJECTIVE

Starbucks business destinations are to procure great benefits and do beneficial things on
the planet through their responsibilities in giving top-notch items and administrations. The
espresso goliath utilizes its reliability program to adjust clients to bigger business objectives and
targets, for example, downloading the Starbucks application to utilize their "Request and pay"
framework, pursuing their Starbucks Rewards Visa card, or attempting new items and
administrations. To make a Starbucks experience that makes individuals come for the espresso,
remain for the mood and climate, and return for the association; To fabricate a picture separate
from more modest espresso chains. Organization pioneers are created to lead multicultural
groups of people with assorted points of view and bits of knowledge that guarantee organization
development and further develop assistance conveyance for clients. The organization looks to
develop associations with an assorted organization of providers through essential local area
relationship-building. Starbucks additionally endeavors to be open and authentic in its
collaborations with providers, workers, and clients. This is reflected in the organization's mission
to drive execution without forfeiting individual and corporate humankind.

STARBUCKS BUSINESS/ PRODUCT PORTFOLIO:

Products:
Starbucks offers a range of exceptional products that customers enjoy in our stores, at home, and
on the go.
Coffee:

More than 30 blends and single‐origin premium coffees.

Handcrafted Beverages:

Fresh‐brewed coffee, hot and iced espresso beverages, Frappuccino® coffee and non‐coffee
blended beverages, Starbucks Refreshers, smoothies and Tazo® teas.
Merchandise:

Coffee‐ and tea‐brewing equipment, Verismo System by Starbucks, mugs and accessories,

packaged goods, music, books and gifts.
Fresh Food:
Baked pastries, sandwiches, salads, salad and grain bowls, oatmeal, yogurt parfaits and fruit
cups.
Brand Portfolio:  
Starbucks Coffee, Seattle’s Best Coffee, Teavana, Tazo, Evolution Fresh, La Boulange and
Torrefazione Italia Coffee.
BCG MATRIX OF STARBUCKS

STAR:
 Starbuck’s food business vertical has surely been the STAR for the company. With plans
to double its food business by 2021-2022, the company is experimenting with its food offerings
and options. Its hot breakfast sandwiches complemented the brand’s signature coffee offerings so
well.

Embracing the high customer demand for protein and healthy snacks, the company
launched Sous Vide Egg Bites, which saw more than 60% jump since its launch in January 2017.
The company has been able to create its own niche in the food industry catering to its own
specific customer group.

CASH COWS:

The CASH COW for Starbuck’s is its coffee business. The bread winner for the
company, coffee business has grown leaps and bounds all these years, helping the company post
strong financial numbers.

Despite facing competition the company has been able to create its own set of loyal
customers. It’s overall coffee drinking experience that distinguishes the company from the rest.
Starbucks has been instrumental in changing the way we consume and interact with coffee.

QUESTION MARK:

Starbucks offers Tumblers, Mugs, and T-shirts to its customers, with most of them being
limited edition, seasonal, and often sell out within days. Due to the brand’s exclusive and
premium positioning, customers take pride in owning Starbuck’s merchandise.

There is still a long way to go for Starbucks in terms of creating a strong footprint in
clothing and general merchandise industry. For this reason, the best place for Starbuck’s
merchandise is in question mark quadrant.

DOG:

Starbuck’s packaged goods business is the most recent business vertical of the company.
The company signed a deal with Nestle to market Starbucks Consumer Packaged Goods and
Foodservice products globally, outside of the company’s coffee shops.

Starbucks Consumer Packaged Goods is operating in a low growth market and currently
holds a low market share. The uncertainty that this business vertical holds in the future is the
reason it is considered as a Question Mark for the company.
STARBUCKS SWOT Analysis
Starbucks is one of the world's most well-known brands and one of the world's largest
foodservice companies. It has become associated with rich lifestyles and high-end coffee drinks.
It has grown at a rapid pace in recent decades, and its premium beverage variety, marketing
acumen, and strong customer loyalty have helped it maintain its position in the market.

Here we look into the unique strengths, weaknesses, opportunities, and threats for this company:

Strengths

1. Strong Brand Image

Starbucks is one of the most well-known and well-respected consumer brands in the world.
Consumers are strongly loyal to this company and continue to contribute to its longevity,
with practically uncountable shops across the United States and lineups around the corner for
the most drive-thrus. By making coffee a "luxury" product rather than a "common"
commodity, it was accountable for a lot of things. In addition, it maintains a strong brand
presence through popular products and active public relations campaigns. Starbucks is one of
the world's top five most admired companies. (Fortune)
 2. Strong financial performance

Starbucks has seen a significant increase in the number and density of locations in its core
regions as a result of all of this consumer enthusiasm, which has resulted in strong sales
results year after year. In a given year, Starbucks would often open thousands of outlets,
overwhelming the market and driving out competitors. Over the last few years, even
emerging countries like China have seen rapid growth. Starbucks had approximately 31,000
locations throughout the world. (Statista)

3.     Growth in stores

Starbucks has mastered the art of supply chain management, which necessitates a large
volume of business as well as a high volume of merchandise. It gets its coffee beans from all
across the world, guaranteeing that customer demand is always met. A total of 30 nations are
used to obtain Starbucks' coffee beans, including Central and South America as well as Asia
and the Pacific Islands. (Business Insider)

4.   Acquisitions

Starbucks is no exception to the rule that smart corporate acquisitions may strengthen an
already strong company. A few of the ways it has brought existing brands into the corporate
fold seamlessly include the purchase of existing companies like Seattle's Best Coffee,
Teavana, Tazo, and Ethos Water. These are just a few of the ways it has brought existing
brands into the corporate fold seamlessly. (Statista)

5.    Treating employees well

The organization has a reputation for treating its employees properly, with a focus on their
well-being and respect. It has received praise from the industry for its treatment of employees
and has frequently made headlines for its efforts to raise wages for its frontline workers. One
of the most well-known companies is Starbucks. (Forbes)

6.   Diverse product offerings

      Starbucks has established hundreds of exclusive beverage options that are intimately linked to
the entire brand, such as the ever-popular pumpkin spice latte, for such a fundamental food
item as coffee. Consumers can also advertise their commitment to the company by purchasing
branded stuff, and supermarket goods allowed them to carry their favorite mixes to their
homes or offices rather than relying entirely on the restaurant. Over 350 million cups of
Starbucks' pumpkin spice latte have been sold. (Mashable)

Weaknesses

1. Volatile supply costs

 The price of Starbucks coffee beans is directly proportional to the price of its coffee. It likely
acquires higher-quality beans because it advertises itself as a purveyor of exquisite coffee
goods, and any increase in the cost of purchasing the raw coffee beans itself must be passed
on to the user in some way. If coffee prices continue to rise, some consumers may be turned
away if they are forced to pay more at the register. With a 164 percent increase in price from
2007 to 2011, and a total 20% growth from 2007 to 2020, coffee bean prices have varied
substantially over time. (Business Insider)

2. High product prices

Even a standard cup of coffee costs a lot more than at other places, and there are a lot of different
drinks and customization possibilities. For individuals who regard coffee as a necessity rather
than a luxury, preparing coffee at home or at work is also far less expensive. It can be tough to
overcome this reputation and justify high prices, and Starbucks has to do it on a daily basis.
Starbucks items are on average 38% more expensive than those sold by competitors. (Business
Insider)
 
3. Product can be easily imitated

Despite its intimate ties to coffee, the product is a staple in many countries around the world.
Coffee is drunk almost everywhere, with dozens of large chains and tens of thousands of smaller
eateries offering it on their menus, as well as individuals buying it directly from a store.

Starbucks should do a better job promoting itself as the preferred choice over alternatives that
may be significantly less expensive and/or aren't as appealing to consumers who simply want a
"regular" cup without customizations.
Starbucks has a two-thirds share in the specialty coffeehouse market. (Forbes)
 
4. Unhealthy choices

Starbucks offers a variety of drinks that are heavy in calories and sugar, making them extremely
unhealthy if you drink them on a regular basis. Consumers might simply choose a product with
less ingredients, but the corporation has built its reputation on flavored and sweetened items that
appeal to their taste buds. This problem will be solved by providing healthier options and recipes
that have been modified. There are 510 calories and 85 grams of sugar in a Starbucks cinnamon
roll Frappuccino. (Business Insider)

5. Product recalls

Product recalls, like any other food or beverage firm, can be disastrous if not handled quickly
and appropriately. Selling a product that contains foreign pollutants or allergens can not only be
harmful to the user, but it can also be a PR disaster for the company. To minimize future damage
 to its brand name, it is critical to prevent errors and fix them as soon as possible. In 2016,
Starbucks recalled two food items due to allergy contamination. (CNN)

 
6. Avoidance of European taxes
In various European markets, Starbucks has been chastised for failing to pay product taxes. This
resulted in a huge public relations disaster that may have had a long-term impact on the
company's reputation. Other bigger mistakes may cost the organization enormous social and
financial capital, even if there were no long-term ramifications for the company as a whole.
According to reports, Starbucks did not pay any taxes on its £1.2 billion in sales in the United
Kingdom.

Opportunities

1. Expansion into developing markets

Starbucks already has a significant presence in the United States, and its position in China is
steadily improving. In order to establish a better global brand reputation, it can use these
triumphs as a blueprint for expanding into new markets, learning from the experience, and
connecting with additional people. It may maintain its incredible track record of expansion by
becoming the first or largest player in key markets.

Starbucks is present in 83 countries throughout the world. (Investopedia)

2. Further product diversification

Starbucks is well-known for a few goods, but the company could perform even better if it looked
into additional niches for specialty items. In addition to coffee, it can look at additional beverage
options that can be added to the original coffee product, as well as wholly new goods like teas,
sodas, and flavored waters. Its culinary selection could also be expanded to provide customers
with more options. Customer satisfaction at Starbucks is 78 percent. (Statista)

3. Partnerships with other companies and brands

Starbucks can take advantage of the advantages of a collaboration with other established firms by
co-branding some products with those from other companies or cross-promoting other brands in
its stores. When this type of partnership is done properly, it strengthens both businesses' public
reputation and can improve both parties' sales. Nestle and Starbucks have collaborated on a line
of coffee creamer products that will be available in commercial stores. (CNN)

4. Diving into the latest coffee trends

 For the most part, Starbucks has stayed on top of consumer trends, but it can be tough to keep up
with the ever-changing needs of its customers. As a strategy to attract new customers, the
company may keep on top of the newest trends and tastes by conducting extensive research,
collecting consistent consumer feedback, and developing new items quickly. Cold brew coffee
was introduced to the public by Starbucks. (Mashed)
 
5. Price differentiation
The majority of Starbucks' items are quite pricey, which may deter some customers and force
them to hunt for alternatives that are less expensive. It might look at more cost-effective
alternatives that could appeal to more frugal or cost-conscious drinkers as it develops new
premium-level products, bolstering what should be a basic market sector. Starbucks generated
$26.5 billion in revenue around the world. (Statista)

6. Coffee delivery service

In recent years, especially during the COVID-19 outbreak, food delivery services such as
GrubHub and Uber Eats have been increasingly popular. To further cater to consumer tastes,
Starbucks might work with companies like these to distribute its products or establish its own in-
house delivery service to take advantage of this expanding consumer trend. In the next few years,
revenues from online food delivery services are estimated to exceed $97 billion. (Statista)

Threats

1. Issues with its supply chain (cost, strikes)

Changes in the supply chain can lead to huge problems in the road, such as poor coffee bean
crops, severe weather, and even third-party provider employee strikes. From farming the beans to
brewing them in the café, the enterprise is reliant on even the tiniest changes at any point along
the way. Wherever possible, Starbucks should look for solutions to reduce potential deficits.
Due to crop shortages caused by the weather, coffee prices are projected to climb. (Sprudge)
 
2. Easily imitated
Coffee can be bought almost anywhere, and many of the basic menu items may be reproduced
for a fraction of the price. If Starbucks wants to dominate the market for "basic" coffee products,
it must overcome the idea that they are difficult to duplicate, either by emphasizing the origin of
the beans or the brewing technique. In the United States, coffee is sold for $5.18 billion in retail
sales. (Statista)
 
3. Lower-cost coffee restaurant chains
Coffee is available on the menus of other breakfast-oriented restaurants, and the cost of a typical
cup of coffee is significantly less than at Starbucks. These chains pose a huge threat to a
company that feeds on higher-priced sales, whether because to lower profit margins or a modest
decline in quality.
McDonald's coffee is a lot less expensive than Starbucks coffee, and it may be manufactured
with a lot of the same ingredients. (Delishably)
 
4. Small local coffee houses
Smaller, independently owned coffee shops, on the other hand, present themselves as community
anchors, or promote a "shop local" attitude or a more hospitable social setting. Starbucks should
be aware that the presence of a larger restaurant chain pushing out a small business might leave a
sour taste in consumers' mouths, and this market sector, which may have a more loyal following
among some members of the community, should be considered.
The number of coffee and tea establishments in the United States has decreased by 7.3 percent.
(Bloomberg)
 
5. After-effects of COVID-19
The COVID-19 epidemic had a significant impact on the general public's spending and
purchasing habits, and some of the impacts will still be seen years later. Restaurants were
obliged to operate at a very low level of client demand or close completely, resulting in a
significant loss in revenue. Starbucks will be no exception when it comes to dealing with the
economic consequences of the pandemic.
Due to the COVID-19 epidemic, over 17% of all restaurants in the United States will close
partially or completely in 2020. (National Restaurant Association)
6. Global recession
Companies like Starbucks, which may suffer from its self-designed "high-end" brand image, will
be affected by other national and international recessions in the future. An expensive cup of
coffee may be one of the first things to go if consumers opt to forsake certain comforts. To avoid
this kind of loss in its customer base, Starbucks may broaden its pricing options and offer more
affordable options. The global economy is anticipated to contract by 5.2 percent in the next year.
(World Bank)

Starbucks has positioned itself for long-term success thanks to its strong brand, innovative
product options, and sound financial foundation, and the firm still has room to grow and expand
even more. It can maintain its position as a consumer favorite for decades to come by addressing
supply chain difficulties, finding ways to keep costs low for its clients, and exploring new sales
and development opportunities.
Marketing Strategy (4Ps)

Starbucks

Products:
Starbucks has many variety of products like coffee, pastries and other beverages. A Simple
Coffee cup with the handwritten name of the customer on it is the unique product design
strategy of Starbucks which is a signature favorite among customers.
Starbucks commits to the “Barista Promise “ in which they make their coffee and drinks in
the way that customers desire. Customers can also request to customize their drinks. They
also have Starbucks secret menu in their website where there are many variety of flavors that
were include for their customer to choose how they like their drinks to be made. They also
merchandise design mugs and tumblers.
Thus, the product categories in which Starbucks deals are:
 Coffee
 Tea
 Baked Goods
 Frappuccino
 Smoothies
 Starbucks Merchandise (Mugs, Instant coffee etc)
 Other food items and beverages.
Price:
Starbucks adopts the Premium Pricing Strategy. The purpose behind this strategy is to
cultivate a sense in the market that their product is superior to others. Another reason
Starbucks is able to charge premium prices is that it has cultivated a very good image for
itself as a provider of ethically-sourced, high-quality coffee. 
Starbucks sells its products at high prices to their target audience. The company satisfies its
customers and justifies its prices by providing excellent service and ambience at its stores. 
Starbucks’ price strategy is focused on customer experience and product quality which also
helps them stand out from the competition and thus becomes a status symbol for its
customers.
Place:
Starbucks’ place strategy has played a huge role in the success of the chain stores.  It has
more than 30,000 stores in around 83 countries across the globe. Starbucks offers the
maximum number of their products at their stores. However, they also have the following
chains of distribution for their products.
 Coffeehouses
 Retailers
 Mobile applications
 Starbucks highly focuses on the design and environment of its coffeehouses where
customers enjoy a premium experience. They open their stores at “it” places like
Malls and Popular Markets.
 Starbucks also sells their merchandise with different brands and retailers
 The company also has an e-commerce presence integrated with e-payments.
Customers can easily order their coffee from the Starbucks app and pick up their order
from the store.

As Starbucks Philippines navigates through the new normal, the company announced the
nationwide availability of Mobile Order and Pay on iOS and Android devices, a new feature
of their popular mobile app that allows customers to place and pay for their order in advance
and pick it up at any Starbucks store. 
The app is the easiest place to find a store, order ahead and make a payment using your
Starbucks Rewards account. Bringing Mobile Order & Pay meet the needs of their customer
for convenience and safety, while still providing an exceptional store experience.
Promotion:
Starbucks promotes its products by the following mediums:
 Advertising
 Offline
 Online
 Social media
 Sales promotions
 Word of mouth marketing.
 Starbucks promotes its products via both offline and online mediums of advertising.

It uses big banners for the promotion of its beverages and ongoing offers.

Starbucks is highly active on various social media platforms like Instagram, Facebook,

Twitter, Snapchat etc. The company promotes its products on each platform with very
deliberately designed images and videos that easily connect with its audiences. It also
provides many offers at its coffeehouses. They also issue discount coupons in collaboration
with payment apps. All of these are sales promotion incentives.

Word of mouth marketing is the strategy in which your existing customers become the
biggest promoters of your brand. Starbucks’ brand image helps immensely in this regard. By
focusing on customer relationships and customer satisfaction, they have been able to
successfully bank on consumers’ recommendations. 
STARBUCKS TARGET CUSTOMER ANALYSIS
The company revolutionized the coffee shop concept so that customers line up for the pleasure
of paying top dollar for their favorite coffee concoction made with premium beans, fashioned
into every manner of taste, and finished off just the way they like it.

Even non-coffee drinkers have their favorite menu items, and just like the coffee shops of yore,
Starbucks has sandwiches, desserts and other snacks. The truth is, the company has done so
well by knowing exactly who its target audience who are in the middle- to upper class men and
women is at any point in time and going all-out to cater to those people.

High Income, High Spenders

Starbucks' target market is often described as affluent or high income. That's why every
affluent neighborhood has a Starbucks not far away. However, numerous Starbucks cafes are
surrounded by middle-income neighborhoods where people don't have such high incomes.
These people also have discretionary income and are willing to spend it on premium coffee
drinks. They may not splurge on other things as often as the higher income customers, but they
enjoy treating themselves to their favorite coffee and, sometimes, a breakfast sandwich, snack
or dessert to go with it.

Urban-ish, On-the-Go

Another description you often hear of Starbucks' target audience is that they're urban. Many
Starbucks are located in outlying areas that are considered suburbs of urban areas but are often
60 miles or more from the city. Their common trait is that they're busy people. They spend a
lot of time in their cars going from place to place, such as to work, to their kids' sports
activities, to the store,and to the gym. They have an urban-ish attitude, but they don't live in the
city. As suburbanites, they spend a lot of time sitting in traffic, which makes their coffee
splurge even more welcome.

Technology Early Adopters

Not all of the target market was on the computer by age 2, but technology is second nature to
them now. The target age of Starbucks' market is 22 to 60, with the teen audience growing
steadily. Even the 50- and 60-year-olds rely on their smartphones to make their lives easier.
Starbucks obliged in 2015 with its app for mobile orders and payments, and it was a huge
success.
Ever since offering Wi-Fi to the public in 2002, the company's on-the-go audience has seen
Starbucks as not just a pit stop, but as a mini-office where they can set up their laptops and
attend to business while sipping their favorite beverages.

Healthy-ish Professionals

While scientists continue to debate the health benefits of coffee, Starbucks coffee lovers make
room for their beverage of choice regardless. Most of the company's audience consists of
educated, white-collar professionals who read a lot and stay up on news and trends, including
those about health. Starbucks caters to their tastes with a list of available teas and tea
concoctions that's as varied as its coffee offerings.

Decaf tea, green teas, wellness tea, mixtures like Royal English Breakfast Tea latte and
Teavana bottled blends play to this part of the company's audience. Starbucks bought Tazo and
Teavana tea companies and Evolution Fresh for its juices.

Socially Conscious Customers

Starbucks' commitments to protect the planet and make a difference to the communities its
cafes serve were evident from the early years with its first LEED-certified store, which was
built to comply with green standards way back in 1995. The decisions to promote sustainable
coffee growing, open farmer support centers, reduce the company's own footprint, use recycled
fiber cups, provide college opportunities to employees, open stores in underserved and less
affluent areas, and work to improve surrounding communities appeal to the target audience that
shares the company's mission of positive change.

Flexible to Change

Starbucks' target audience is laid back but driven. They know that getting ahead requires
adaptability and, like their favorite coffee store, they embrace the changes that come with
growth. As the audience has widened and grown older, the company and its best customers still
see change as opportunities rather than burdens and remain enthusiastic about what the future
may bring.

Reaching Beyond the Storefront

The company's most recent efforts to bring in new customers involves not bringing them  in at
all. Instead, Starbucks will bring the coffee, eats or anything else on its menu to you through its
expanding delivery service. Starbucks has begun delivering in major U.S. cities through a
partnership with Uber Eats and hopes to expand the service in the years ahead. The company is
also expanding its drive-thru options so commuters can pick up a brew without the
inconvenience of finding a place to park.

References:

The Little Black Book (2019, November 21). Starbucks the 4Ps of Success. Retrieved
from: https://tlbb.com.sg/archives/starbucks-the-4ps-of-success/

Shsatri, A. (n.d.) Complete 4Ps Marketing Mix of Starbucks with 360 Company Analysis.
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Heart of Codes (2019, April 5). BCG Matrix of Starbucks | Bean there, Brewed that!
Retrieved from: https://heartofcodes.com/bcg-matrix-of-starbucks/

Bean-Melliger, B. (2019, February 5). Who is Starbucks’ Target Audience?

https://smallbusiness.chron.com/starbucks-target-audience-10553.html
Gaille, B. (2021, March 18) Starbucks SWOT Analysis (2021).
https://brandongaille.com/starbucks-swot-analysis/