MINOR PROJECT REPORT

ON

CUSTOMER SATISFACTION
(STARBUCKS)

Submitted in the partial fulfillment of the degree of

Bachelor of Business Administration (CAM)

(2022)

SUBMITTED BY:

NAME OF THE STUDENT- ANANYA SINGH

ENROLLMENT NO.- 01621001921

Under the guidance of

MR. MAYANK GUPTA DR. ANSHIKA

RAJVANSHI
Sr. Assistant Professor Sr. Assistant Professor

DESIGNATION

Ideal Institute of Management & Technology

(16 X, Karkardooma Institutional Area, Delhi-92)

1
 ACKNOWLEDGEMENT

I am writing this final Project for the program of Bachelor of Business

Administration on “CUSTOMER SATISFACTION” for Ideal
Institute of Management Technology, Affiliated to Guru Gobind
Singh Indraprastha University.

It has been a great challenge but a plenty of learning and opportunities

to gain a huge amount of knowledge on the way of writing this
Project report. I could not have completed my Project without the
constant guidance of Mr. Mayank Gupta & Dr. Anshika Rajvanshi
our faculty guide, who helped me along the way and was always
prepared to give me feedback and guidelines whenever I needed it.

Student Name: ANANYA SINGH

Enroll no.: 01621001921

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 CERTIFICATE

This is to certify that Minor Project Report entitled, “CUSTOMER

SATISFACTION” is bonafide work carried out by ANANYA SINGH
Student of BBA (CAM), Ideal Institute of Management and Technology
(affiliated to GGSIP University, Delhi) sin partial fulfilment of the
requirement for the award of degree of Bachelor of Business
Administration, under my guidance & Direction. To the best of my
knowledge and belief the data & information presented by him/her in the
project report has not been submitted for the award of any other degree.

Mr. MAYANK GUPTA

(Sr. Assistant Professor)

Dr. ANSHIKA RAJVANSHI

(Sr. Assistant Professor)

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 CONTENT TABLE
S NO. CONTENT PAGE NO.
1. CHAPTER-1 Plan of the Study:
 Introduction
 Objective of the study
5-20
 Literature review And/or
Theoretical Background

2. CHAPTER-2 Company Profile 21-26

3. CHAPTER-3 Research
Methodology
 Universe & Sources of data
27-32
 Sample size, if any with
proper justification
 Methods of data collection
4. Data Collection and Data Analysis 33-54

5. Findings & Conclusions 55-57

6. Suggestion/ Recommendation 58-59

7. Bibliography
8. Annexure 62-65

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PLAN OF STUDY

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Customer satisfaction is the key factor for successful and depends highly on the behaviors of
frontline service providers. Customers should be managed as assets, and that customers vary
in their needs, preferences, and buying behavior. This study applied the Customer
Satisfaction Index model to a tourism factory to analyze customer satisfaction and loyalty.
We surveyed 242 customers served by one tourism factory organizations . A partial least
square was performed to analyze and test the theoretical model. The results show that
perceived quality had the greatest influence on the customer satisfaction for satisfied and
dissatisfied customers. In addition, in terms of customer loyalty, the customer satisfaction is
more important than image for satisfied and dissatisfied customers. The contribution of this
paper is to propose two satisfaction levels of CSI models for analyzing customer satisfaction
and loyalty, thereby helping tourism factory managers improve customer satisfaction
effectively. Compared with traditional techniques, we believe that our method is more
appropriate for making decisions about allocating resources and for assisting managers in
establishing appropriate priorities in customer satisfaction management. The findings
revealed a significant positive correlation between customer trust and loyalty; customer
satisfaction and loyalty; and customer satisfaction and trust. Customer satisfaction has
identified as an important influencer on customer loyalty. Further, customer trust impacted by
customer satisfaction which proved that customer satisfaction is an antecedent of customer
trust. Moreover, an indirect relationship between customer satisfaction and loyalty through
customer trust was observed. The future studies may replicate in other service contexts and
comparison of models of government and private banks will give more understanding.

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 CHAPTER-1
Introduction

Customer satisfaction

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A customer is basically a potential buyer not an actual buyer of a product. A customer
may be the one who just make a purchase. He may or may not be the consumer. Here
the person who purchase is not the final end user.

The term “CUSTOMER SATISFACTION” means the match between customer

expectations of the product and the product’s actual performance. Customer
satisfaction differs from one person to another. It’s an experience which is different for
different individuals.

FACTORS AFFECTING CUSTOMER SATISFACTION

1. The Product
2. Price of the product
3. Technology
4. Service
5. Communication

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 METHODS TO MEASURES CUSTOMER
SATISFACTION

1) Surveys- The customer satisfaction survey is the standard approach for collecting
data on customer happiness. It consists of asking your customers how satisfied
they are, with or without follow up questions.
2) Net Promoter Score (NPS)- The Net Promoter Score (NPS) measures the
likeliness of a customer referring you to someone, and it’s probably the most
popular way of measuring customer loyalty . Customer are asked how likely they
are to recommend you on a scale from 1 to 10. The strength from NPS is that it's
not about an emotion of satisfaction, but about your intention of referring – which
is easier to answer. It cuts down to the question of whether the product is good
enough to put your own reputation on the line. Calculating your NPS score is
quite easy. Take the percentage of respondents who fall within the ‘promoter’
category (10 - 9) and subtract the percentage of ‘detractors’ (0 - 6).

3) So
cia
l

Media-social media has had an immense impact on the relationship between

business and customer. Where before, a great or poor service experience would
maybe be shared with the closest family and friends, social media offered an
outlet and reach to potentially millions of people.
4) Focus Groups-A focus group is a research method that brings together a small
group of people to answer questions in a moderated setting. The group is chosen
due to predefined demographic traits, and the questions are designed to shed light
on a topic of interest. Focus groups are a type of qualitative research.
5) Live Chat etc.

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 NEED FOR MEASURING CUSTOMER
SATISFACTION

 Customers are too good to lose

---------- Let’s keep them happy!
 “Customer is the king.”
 “Marketing starts with the customer and ends the customer”.… (Peter
Drucker.)
So, no organization, small or big ignores the customers.

 “Earth is not the center of universe but revolves around the Sun”. …
(Copernicus.)

Similarly, we have come to believe that business firm is not the center of
economic universe but revolves around the customer.

WAYS TO ENHANCE CUSTOMER SATISFACTION

1) Identify the customer.

2) Demonstrate product knowledge.
3) By understanding customer’s needs and wants.
4) Treat your customer’s right.
5) By ensuring employee satisfaction.
6) Converting customer survey data into action.
7) Follow up the current trends and technological upgradations.
8) By making customer satisfaction a team effort.
9) Create your own benchmark.

10)Give back to the community (social welfare)

WAYS TO INNOVATE CUSTOMER EXPERIENCE

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1. Establish an online presence-The most significant innovation you can
make for your business today is to bring your brand online. That doesn’t
necessarily mean ecommerce, as just simply having a presence online
makes your company more accessible and helps new customers discover
your business.
2. Offer a customer loyalty program-An effective way to boost customer
satisfaction and retention rates is to offer a customer loyalty program.
Loyalty programs add value after a purchase is made, keeping your brand
relevant even when the customer doesn't need to buy one of your products.

3. Provide omnichannel support-Some of your customers might want to use

Facebook Messenger to ask for help instead of picking up the phone.
Additional support channels innovate the customer experience because you
meet customers where they already are, making your support teams more
accessible to your customer base. Speed is also crucial, so having plenty of
channels for communication makes it easier for your customers to obtain
information quickly.
Example: Spotify
Spotify uses Twitter to respond to questions that people ask on the app. It
also encourages users to request new songs via Twitter, so its team knows
what type of music to add to the platform. It serves as a great way for
Spotify to improve its product and retain and attract customers as well.

4. Add a chatbot to your website-A great way to innovate the customer

experience is by adding chatbots to your website. It automates support
functions, saving time for both customers and support reps. Chatbots also
field basic service inquiries and connect customers to the right reps when
needed. This creates a balanced support system for customers in a hurry
and those looking for a more detailed response from your agents.

5. Be proactive with your customer service-means your support team is

actively looking for new problems that may affect the customer
experience. When a new problem arises, your team gets ahead of the issue

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 and either solves it before it affects your users or alerts your customers so
they can prepare for it ahead of time. It shows customers that you're
constantly thinking about their success and are doing everything to clear
any roadblocks preventing them from achieving their goals.

NEED OF CONSUMER SATISFACTION

There are various needs for consumer satisfaction-

1. FAIR PRICE-When deciding on your price structure, you’ll benefit from

looking at your competitors’ ecommerce stores so you can gauge the customer
needs and expectations. While we agree that price anchoring is not always the
smartest way to decide on a strategy, it’s important to know where you stand in
comparison to your competition. The key thing with pricing is to be transparent. A
consumer needs to feel that they can trust a brand. So, whether you’re above or
below the market rate, let your customers know why this is the case and exactly
what they get for their money.

2. A GOOD SERVICE- Good customer service has been proven time and time
again to allow business’s to charge more. It’s about meeting customer needs, and
sometimes exceeding them, by offering timely solutions with minimum fuss.
Customers continually suggest they would be happy paying more for a product if
it meant it would improve the level of customer service. Having a strong
customer support team increases the level of trust your consumers have for you.
They understand problems will be addressed and fixed in a timely manner and
they’re more receptive when things do end up going wrong. Although good service
is a key consumer need, it’s not an excuse to increase your prices. If you can keep
your products affordable and provide excellent customer service, even better.

3. A GOOD PRODUCT-When it comes to determining customer needs, creating

a solid product is obviously a major priority. Be confident in your product, be open
to suggestions to improve, and always aim to give the customer exactly what they
need, not what you think they need. To work out what customers want, conduct

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 appropriate research with market analysis and customer surveys. This will help you
to identify your consumers’ needs and tailor your product development around
them.

IMPORTANCE OF CONSUMER SATISFACTION-

1. It derives customer loyalty-

Satisfied customers tend to share their positive experiences with friends and
family. But the opposite is also true: An unhappy customer tells more people
about their negative experiences than a happy customer does.

2. Customer satisfaction metrics reflect your support team's

performance-

Customer satisfaction benchmarks and metrics do not just help you gauge how happy your
audience is—they also tell you how your support team is doing. Use a variety of team metrics
to understand customer satisfaction levels

-Your support team’s initial response time:

-The length of time it takes your team to resolve a customer issue:

-How many times a ticket or call required a transfer to find a resolution

3. It encourages repeat purchases-

4. It increases customer lifetime value-

customers are willing to spend more to buy from companies that give them a good customer
experience. Satisfied customers are not only more likely to remain loyal and less likely to
churn, they are also more likely to spend more money with your business.

5. It boosts new customer acquisition-

Customer service is not just important for supporting existing customers, it is also key to
bringing in potential customers and supporting them when they reach out. If a prospect does
not have a positive experience when they interact with your support team, they will be less

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likely to purchase. The main difference between service today and service 10 years ago is that
customers expect premium service to be built-in from the first sales or marketing interaction
and carry through to the moment they ask for help, post-purchase and back again. To position
themselves for success, businesses must integrate service into the journey at every interaction
point.

CONSUMER SATISFACTION MODEL

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  Perceived quality -is the first determinant of customer satisfaction,
which is the served market’s evaluation of recent consumption experience
and is expected to have a direct and positive effect on customer
satisfaction.

 Perceived value- is the second determinant of customer satisfaction, or

the perceived level of product quality relative to the price paid. Perceived
value is a measure of quality relative to price paid. Although price is often
very important to the customer’s first purchase, it usually has a somewhat
smaller impact on customer satisfaction for repeat purchases.

 Customer expectations- are the third determinant of customer

satisfaction, which measures the customer’s anticipation of the quality of a
company’s products or services. Expectations represent both prior
consumption experience, which includes some no experiential information
like advertising and word-of mouth, and a forecast of the company’s
ability to deliver quality in the future.

OBJECTIVE OF THE STUDY

OBJECTIVES:

 To gather information about customer satisfaction toward power supply equipment

(Inverter, ups, etc.)

 To know the customer satisfaction about the safety and comfort provided by the
equipment’s.

15
  To provide suggestions, in improving the customer satisfaction and the company sales
and Profitability
 To know the customer satisfaction towards the after sales service offers by Waves
tech.
 To find out the most prominent area of dissatisfaction.

SCOPE OF THE STUDY:

 To study the customer satisfaction and value.
 Having high performance of the business.
 Attracting and relating customers.
 Adding the benefits people satisfaction.
 Implementing total quantity management.

NEED FOR THE STUDY:

 Customer satisfaction should be of great concern in all organization.
 Customer satisfaction plays the key role in the growth of any organization.
 Customer satisfaction is one way in which on organization gets establishment and
gains recognition among the public.
 The study will help in finding out where the industry lacks behind and how can it
improve, and it also help to understand the satisfaction of customers at various levels.

LIMITATIONS OF THE STUDY:

 The study is based on the customer’s feedback, so there might be changes for
ignoring some of the good and reliable customers.
 The sample size was limited to 100, hence reliability and validity of data were some
extents lacking in the survey procedure.
 The opinion elicited from the research study cannot be taken as the opinion of the
whole population.
 Data totally depends on the respondent’s view which could be biased.

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 LITERATURE REVIEW

Starbucks originated in Seattle, Washington in 1971 and is known for its coffee. The
company took something as basic as coffee and transformed it into something more. “It is a
brand that is defined as much by attitude as it is by products. For devotees, the Starbucks
experience is about more than a daily espresso infusion; it is about immersion in a politically
correct, cultured refuge from everyday hassles”. The idea is to create a “third place” where
consumers can go besides home and work, and where they can relax, listen to music, and
socialize. An urban sociologist, Ray Oldenburg, first termed “third places”: real-life sites that
“host the regular, voluntary, informal, and happily anticipated gatherings of individuals
beyond the realms of home and work”. Starbucks creates an ambiance in which consumers
perceive they can live. “They have gone out of their way to get their customers to live there,
in the way of oversized couches and free Wi-Fi, the latter of which some eateries and cafes
have rebelled against. The average Starbucks consumer frequents a Starbucks at least 18
times a month and 10% of those, tend to visit twice in a day. Due to Starbucks’ wide product

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variety, it attracts customers throughout the day, not just for coffee and tea, but other
consumer packaged goods [CPGs] (oatmeal, sandwiches, parfaits, cake pops, bagels etc.) as
well. In understanding the target market, knowing what customers look for (through purchase
data as well as speaking to the consumer) and creating value for the consumer, Starbucks is
able to create several strategies to entice customers. Brand self-connections, refers to the
relationship between the brand and the consumer (Moore & Homer, 2008). By figuring out
what the consumers’ emotions and needs are, Starbucks is able to figure out ways in which to
attract consumers. Starbucks offers consumer’s hot/strong tasting coffee along with a relaxing
environment which creates memories for the consumers which can later be recalled (Dada,
2014; Hanft,2005; Hartman, 2014; The Inside of the Starbucks Company, 2016). A consumer
can tap into various emotions such as, bittersweet nostalgia and a safe refuge. It also taps into
memories of the past which can also promote brand loyalty (Kaplan 1987; Snyder 1991). A
smart tactic Starbucks has is the reward loyalty card (My Starbucks Reward card).
Consumers can buy a regular gift card and keep using that gift card and with that, can earn
points, and finally receive a personalized Rewards card. The more the card was used, the
more benefits and drinks can be earned. The Reward member status had even more perks.
Another promotion Starbucks came up with, was the treat receipt. Consumers can take the
receipt from earlier that morning and would come back later that day to redeem the coupon to
receive another iced drink. This increased repeat purchasing over the same day. Starbucks
now uses purchase data so it can send personalized offers to consumers. Starbucks collects
the data on items the customer purchases, with that, preferences are recorded when consumer
frequent a store. This information is used to send notifications through the mobile app or
through email. Starbucks has created a mobile platform which encompasses a payment
program to purchase drinks and/or food yet earn points through the loyalty program as well.
“Both give Starbucks "a direct, real-time, personalized, two-way digital relationship with its
customers," says chief digital officer, Cell phones are used tremendously in our daily life and
contribute to 14% of business in both the U.S. and Canada (David, 2014). David (2014)
mentions that the new iPhone app allows customers to “shake and pay digitally” (including
tipping), earning bonus points and other perks along the way (p.6). Starbucks recently
enabled a way for consumers to order drinks through the mobile app before arriving at the
location. The combination of Starbucks cards and mobile payments represents 35% of
payments in the U.S. and Canada. The mobile payment app makes payment faster and
shortens the length of time customers have to wait in line. Customers can track their rewards
when they want to. Brand Loyalty “The marketing literature states brand loyalty as an

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interplay between the consumer’s attitude and repeat purchase behavior”. The repetitive and
systematic purchasing of the same brand can be linked to brand loyalty, along with how a
consumer thinks and feels towards the brand. For true brand loyalty to exist, consumers have
to form an emotional attachment and be committed to the brand. Brand loyalty is broken
down into two dimensions, namely attitudinal and behavioral loyalty. Attitudinal loyalty
deals with how a consumer develops a strong tie not only a brand, but also the employee, thus
allowing the purchaser to pay premium prices for that product. Attitudinal loyalty is how one
associates with that brand Emotional attachments are related to attitudinal loyalty and occurs
when a consumer has a preference for a particular company’s offering in terms of products or
services over competing brands. Customers like this, are the ones who encourage family and
friends to visit these establishments, such as, Starbucks, BMW, and Harley Davidson (Seiler,
2005). When attitudinal loyalty grows over a certain time period, the brand one is purchasing
creates emotions and feelings for the consumer. In essence, attitudinal loyalty depicts the
psychological disposition of various consumers and is measured by the consumer’s attitudes
the behavioral aspect of brand loyalty measures the behavior of the consumer namely,

1) how much of the item does a consumer buy,

2) how often does the consumer purchases the product and

3) the redundancy in purchasing the product in other words, behavioral or purchase loyalty is
the repeated purchase of that brand. In addition, repurchase behavior demonstrates a
consumer’s true commitment to a specific brand “Behavioral loyalty can be expressed as a
brand preference (that is expenditure on a particular brand as a proportion of the total spends
on a product category or as a brand allegiance --that is expenditure on a brand over time”.
Loyal consumers can be distinguished from non-loyal consumers in the following ways:

1) loyal consumers buy the same items over time,

2) tend to look at other product

lines the brand has to offer and 3) will tell others about the brand. From the company’s
perspective, brand loyalty is important to the bottom line in three ways: higher sales volume,
premium pricing ability, and retention of customers. A huge benefit to companies is that
brand loyal consumers will not care if prices increase and still feel that that particular brand
can satisfy their needs. When there is brand loyalty, consumers are not as focused on price
because they feel that this particular brand is of better value and can give them what other
brands cannot. This allows brands to have premium pricing. When retaining customers,

19
companies end up spending less on advertising, marketing, and distribution (Dowling &
Uncles, 1997; Giddens, 2010). In reducing marketing and promotional costs, brands can
make more profit. On average, companies lose around 13% of their customers every five
years. To gain even 1% annual growth, requires increasing new customers by 14% (Giddens,
2010). If a company is able to lower the number of customers it is losing, then it can improve
business growth. In having brand loyal customers, there is continuous profit due to long-term
and repeat consumers, the company does not have to worry about continuously marketing to
attract new consumers and consumers tend to spend more overtime. If a brand wants to
increase its customer base, there is a need to be innovative and come up with more ways to
entice consumers.

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 CHAPTER- 2
Company profile

STARBUCKS

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Starbucks was founded on 30thMarch 1971, Pike Place Market, Seattle, Washington,
United States.

But in India Starbucks opened its first store in India in 2012 in Mumbai's Horniman
Circle. In the last five years, the coffee chain - the most frequented retailer in the world
- has opened stores in Pune, Hyderabad, Chennai, Delhi NCR, and Bangalore.

FOUNDERS OF STARBUCKS
1. Jerry Baldwin
2. Gordon Bowker
3. Zev Siegl

CEO OF STARBUCKS
 Kevin Johnson
 Sushant Dash (In India)

In India Tata Starbucks Private Limited, formerly known as Tata Starbucks Limited, is
a 50:50 joint venture company, owned by Tata Consumer Products and Starbucks
Corporation, that owns and operates Starbucks outlets in India.

BOARD OF DIRECTORS OF STARBUCKS

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 1. MELLODY HOBSON- has served as chair of the board since March 17, 2021. She
served as vice chair of the board from June 26, 2018, to March 2021 and has been a
Starbucks director since February 2005.
2. RICHARD E. ALLISON, JR.-
3. Andrew Campion
4. Mary N. Dillon
5. Isabel Ge Mahe
6. KEVIN JOHNSON
7. SATYA NADELLA
8. JØRGEN VIG KNUDSTORP
9. JOSHUA COOPER RAMO
10. CLARA SHIH
11. JAVIER G. TERUE

Their story began in 1971. Back then we were a roaster and retailer of whole bean and
ground coffee, tea, and spices with a single store in Seattle’s Pike Place Market. Today, we
are privileged to connect with millions of customers every day in more than 80 markets.

FOLKLORE

Starbucks is named after the first mate in Herman Melville’s “Moby-Dick.” Our logo is also
inspired by the sea – featuring a twin-tailed siren from Greek mythology.

STARBUCKS MISSION

Our mission: to inspire and nurture the human spirit – one person, one cup and one
neighborhood at a time.

OUR COFFEE

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We’ve always believed in serving the finest coffee possible. It's our goal for all our coffee to
be grown under the highest standards of quality, using ethical sourcing practices. Our coffee
buyers personally travel to coffee farms in Latin America, Africa, and Asia to select high-
quality Arabica beans. And our master roasters bring out the balance and rich flavor of the
beans through the signature Starbucks® Roast.

OUR STORES
Our stores are a neighborhood gathering place for meeting friends and family. Our
customers enjoy quality service, an inviting atmosphere and an exceptional beverage in our
stores and immersive Starbucks Reserve® Roastery locations in Chicago, Milan, New York,
Seattle, Shanghai, and Tokyo.

34,000+ S T O R E S I N 8 4 M A R K E T S

Andorra, Argentina, Aruba, Australia, Austria, Azerbaijan, Bahamas, Bahrain, Barbados,

Belgium, Bolivia, Brazil, Brunei, Bulgaria, Cambodia, Canada, Cayman Islands, Chile,
China, Colombia, Costa Rica, Curacao, Cyprus, Czech Republic, Denmark, Dominican
Republic, Egypt, El Salvador, Finland, France, Germany, Greece, Guatemala, Hong
Kong/Macau, Hungary, India, Indonesia, Ireland, Italy, Japan, Jamaica, Jordan,
Kazakhstan, Kuwait, Lebanon, Luxembourg, Malaysia, Malta, Mexico, Monaco, Morocco,
Netherlands, New Zealand, Norway, Oman, Panama, Peru, Philippines, Poland, Portugal,
Puerto Rico, Qatar, Romania, Russia, Saudi Arabia, Serbia, Singapore, Slovakia, South
Africa, South Korea, Spain, Sweden, Switzerland, Taiwan, Thailand, Trinidad and Tobago,
Turks and Caicos, Turkey, United Arab Emirates, United Kingdom, United States, Uruguay

and Vietnam.

OUR PARTNERS
Our employees, who we call partners, are at the heart of the Starbucks Experience. We offer
comprehensive health coverage for eligible full- and part-time partners; equity in the
company through Bean Stock; and the opportunity for eligible U.S. partners to earn
bachelor’s degrees with full tuition reimbursement through the Starbucks College
Achievement Plan.

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STARBUCKS DEALS IN-
Coffee: More than 30 blends and single-origin premium coffees.

Handcrafted Beverages: Fresh-brewed coffee, hot and iced espresso beverages, Starbucks
Cold Brew slow steeped coffee, Frappuccino coffee and non-coffee blended beverages,
Starbucks Refreshers beverages,

smoothies and teas.

Merchandise: Coffee- and tea-brewing equipment, Verismo System by Starbucks, mugs, and
accessories,

packaged goods and gifts.

Fresh Food: Baked pastries, sandwiches, salads, protein boxes and bowls, oatmeal, yogurt
parfaits and fruit cups.

Consumer Products

• Coffee and Tea: Whole-bean and ground coffee (Starbucks and Seattle’s Best Coffee
brands), Starbucks VIA

Instant, Starbucks Coffee K-Cup pods, Starbucks and Teavana verismo pods.

• Ready-to-Drink (RTD): Starbucks bottled Frappuccino coffee drinks, Starbucks

Discoveries chilled cup

coffees, Starbucks Discoveries Iced Café Favorites, Starbucks Iced Coffee, Starbucks Double
shot espresso

drinks, Starbucks Double shot Energy Coffee drinks; Starbucks Bottled Cold Brew;
Starbucks Refreshers

beverages, Evolution Fresh bottled juices, Teavana bottled craft iced teas.

BRAND PORTFOLIO

Starbucks Coffee, Seattle’s Best Coffee, Teavana, Evolution Fresh and Ethos Water.

INVESTOR INFORMATION

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• Starbucks went public on June 26, 1992, at a price of $17 per share (or $0.27 per share,
adjusted for subsequent stock splits) and closed trading that first day at $21.50 per share.

• Starbucks was incorporated under the laws of the State of Washington, in Olympia, Wash.,
on Nov. 4, 1985.

• Starbucks Corporation's common stock is listed on NASDAQ, under the trading symbol
SBUX.

W E B E L I E V E I N T H E P U R S U I T O F D O I N G GOOD

We have always believed Starbucks can – and should – have a positive impact on the
communities we serve. One person, one cup and one neighborhood at a time. It is our vision
that together we will elevate our partners, customers, suppliers, and neighbors to create
positive change in the areas where we can make the biggest impact:

• Leading in sustainability: Our aspiration is to become resource positive, giving more than
we take from the planet by storing more carbon than we emit, eliminating waste, and
providing cleaner freshwater than we use.

• Strengthening communities: We seek to be a welcoming Third Place for everyone while

supporting the communities we touch – from volunteering in our local neighborhoods to
helping families in coffee- and tea-origin communities.

• Creating opportunities: We invest in pathways to opportunity through education, training,

and employment; hiring veterans and military spouses, refugees, Opportunity Youth, and
those formerly incarcerated, and helping them build their futures once they are with us.

26
 CHAPTER- 3
Research methodology

 PRIMARY RESEARCH
Primary research is a type of research method used to collect data directly. It is of
importance as the data are first-hand information from the current situation and
market. The primary research of this study is a questionnaire created by Google form.
The sample size is randomly selected of 100 respondents. The respondents are
required to answer all the questions in this questionnaire. It consisted of Part A
(Demography), Part B (The effect of Brand Reputation towards Customer
Satisfaction), Part C (Recommendation for improvement). A 5-point Likert Scale

27
 was used at part B to measure how brand reputation influences customer

satisfaction.

 SECONDARY RESEARCH
Secondary research is a type of method where the researchers use or gather data from
existing sources, such as articles, textbooks, and journals. The secondary research
method we used in this survey is internet source and journal review. We visited the
official website of Starbucks. We also obtained a lot of information from journals
related to our topic as references to complete this report. The journals can give us
reliable information to master the knowledge of this study.

Table 1
shows that female respondents are more than male respondents. There are 61% of female
respondents, and 39% of male respondents. Most of the respondents come from ages 18 to
24 years old (73%), between 25 to 39 years old (25%) and the remaining 2% are

40 to 60 years old. By nationality, Malaysian respondents are the most numerous,

representing 85 out of 100 respondents. The remaining respondents come from China
(10%), Japan (3%), and Indonesia (2%). By race, the data shows that the largest number
of respondents is Chinese (45%), Malay (37%), Indian (13%), and others (5%). By
occupation, 75% of respondents are students, and 25% of respondents are employed. Thus,
73% of respondents have no income, 18% of respondents have a monthly salary in the
range of RM 2000 to RM2999 and 6% of respondents have a monthly salary in the range
of RM 3000 to RM 3999. The remaining 2% and 1 % of respondents are having a monthly
salary below RM 2000 and above RM 4000 respectively.

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29
According to the aspect of the brand reputation, we made three survey questions:
“Starbucks is a prestigious store”, “Going to Starbucks indicates my high standard of
living” and “Starbucks advertisements are published everywhere”. To confirm our H1
"Brand reputation has a positive effect on consumers' satisfaction at Starbucks, India",
we sorted out and produced a regression analysis based on the respondents’ responses. As we
can see in Table 4, brand reputation is the independent variable while

International Journal of Tourism & Hospitality in October, customer satisfaction is the

dependent variable. The beta value of brand reputation is .439***, and its p-value is very
significant. It means that the probability that the difference between samples is caused by

30
sampling error is less than 0.001, which further shows that it statistically significantly
improves customer satisfaction. Thus, H1 is supported. Based on the results, we can
conclude that brand reputation affects customer satisfaction at Starbucks, which also
supports our hypothesis (H1). A higher brand reputation will result in higher customer
satisfaction. This is because a higher brand reputation will lead to better promotion (through
advertising or social platforms), services, product quality, and public praise (i.e.,
recommended by more people). We suggest that brand reputation is directly proportional
to consumer satisfaction: the relationship between brand and consumer is a process from
scratch. In the beginning, consumers had no impression of a brand. Because of the influence
of brand reputation, which may be initially reflected in promotion or recommendation,
consumers will gradually become interested in it. Frequently, consumers may have bought
behavior. After purchasing a branded product, their behavior will be affected by the brand's
reputation (good service, good product quality), resulting in a satisfying purchasing
experience. Thus, Starbucks, Malaysia had built a good reputation to enhance customer
satisfaction. Based on the study, Starbucks, Malaysia can have some improvements to
enhance its reputation and maximize customer satisfaction. The majority of respondents deem
the price of Starbucks products too high. They hope Starbucks can lower the price. Due to its
premium price strategy, Starbucks is recommended to improve the overall quality to make the
product worth the price. More advertisements on social media or TV are to promote the
products and introduce new products. This allows the consumers not to miss a seasonal
promotion. Besides, the advertisements can inspire more consumers to visit. The facilities
should also have some improvement. Since some customers like to study or work at the cafe,
Starbucks should make sure the internet connectivity, more seats and tables, and some private
space for consumers. Other than that, the toilets in some branches of Starbucks, Malaysia are
unisex, leading to inconvenience. It is better to separate the male and female toilets. The
respondents also recommended that every Starbucks should have drive-thru accessibility that
makes them easier to purchase. Many respondents also suggested Starbucks do some
improvements on the menu, such as adding more choices of dessert and new drinks. Besides,
the menu can be more detailed with bilinguals. It will be easier and convenient for customers
to order. Some research or feedback about the taste of food is beneficial. Also, the time to
prepare the food should be faster to avoid customers waiting too long. All of these
recommendations are advantageous to strengthen Starbucks' reputation and maximize
customer satisfaction.

31
 CHAPTER- 4
DATA COLLECTION AND DATA
ANALYSIS

32
Data We Collect
As you use our websites and mobile applications or visit one of our stores, we collect
information about you and the services you use. The information we collect falls into three
main categories: (1) information you voluntarily provide us; (2) information we collect from
you automatically; and (3) information we collect from other sources. Some examples of
when we collect this information include when you browse or make a purchase on one of our
websites or mobile application; create a Starbucks account; use our website or mobile
application to purchase, reload or redeem a Starbucks Card; use the order and pay
functionality in our mobile applications; buy or send a gift card or e-gift , or participate in a
survey or promotion.

a. Data You Voluntarily Provide Us

Some information we collect is provided when you use our services, such as when you create
an account, add a Stored Value Starbucks Card, or join Starbucks Rewards loyalty program;
pay for products; book a Starbucks Roastery tour; or submit online forms through our
websites or mobile applications.

This may include your first and last name, username, password, email address, postal address,
phone number, financial account information such as a credit card number, the day and
month of your birthday, demographic information (such as your gender), and any other
information you give us, such as to participate in a promotion or to contact Starbucks
customer service.

You may also choose to permit us to access information directly from your device, such as
information in the device’s “contacts list". The term “your device” as used in this Statement
refers to any computer, tablet, smart phone, or other device you are using to access our
websites or to operate the Starbucks mobile applications. For more information about mobile
application permissions, please see the Starbucks Mobile Applications section below.

You may also in some instances provide us information about other people, such as name,
phone number and email address, including when you direct us to send someone a gift card or
e-gift.

33
(b) Data We Collect Automatically-
Purchasing Information – We may collect information about your transactions in our stores,
on our websites or via our Starbucks mobile applications including what products you
purchase, how frequently you purchase them, any Rewards or promotions associated with a
purchase, and the products you have placed on your “Wishlist" or “My Bag" for future
purchase.

Device and Usage Information –

We may collect information about your browser or device. This information may include the
type of device you are using, your operating system, your browser, your internet service
provider, your domain name, your internet protocol (“IP”) address, your device and mobile
ad identifiers (e.g., Apple IDFA or Android AAID), the website that referred you to our
website, the web pages of our website that you view (including the date and time you viewed
them), the services or functionality you access or use (including the date and time of your
access or use), and the subject of the ads you click or scroll over. To collect this information,
we may use log files that record events in connection with your use of our services, as well as
cookies and similar technologies, such as web beacons embedded in marketing emails to
monitor the engagement of recipients.

CCTV Information –
Closed circuit video surveillance cameras (“CCTV”) may be installed at some of our retail
locations to monitor building security and assist in crime prevention, detection, and
investigation, and to ensure the safety of our staff and visitors to our facilities.

Location Information – We may collect information about the location of your device, such
as information that identifies your device’s precise location (for example, GPS latitude and
longitude level) or its approximate location (e.g., less precise location estimated based on a
browser or device’s IP address). We may also use location-based technology in our retail
locations, such as I Beacons, to collect information about the presence of your device, if your
Bluetooth is turned on and your device settings allow for this.

We collect this location information or derive it from your GPS, Wi-Fi, Bluetooth or other
device settings for purposes of enhancing or facilitating our services, such as to enable the

34
functionality of our websites or mobile applications that provide you with information about
stores near you, to enable you to remotely order and pay for our products and services, or so
that you may have certain Starbucks products delivered to you by a third-party vendor.

We may also use information about the location of the device you are using to help us
understand how our websites, mobile applications, and other services and functionality are
being used, or to deliver more relevant advertising or personalized experiences for you,
including tailored marketing offers or messages based on your location or related context
such as the time of day or weather. If you want to opt out of the collection of this location
information, please see the section below titled Your Choices. To learn more about our
mobile-based location services, please see the Starbucks Mobile Applications section below.

(c) Data We Collect from Other Sources

Some information we collect is from unaffiliated sources, including in some cases
information that is publicly available, provided by or purchased from marketing business
partners, or present on social media platforms.

For example, we may collect information you submit to a blog, a chat room, or a social
network like Facebook or Twitter. We may also collect or license information about you from
other companies and organizations, such as information aggregators or event or promotion
co-sponsors, including to supplement information that we receive from you. We may also in
some cases receive information about you from Starbucks-affiliated entities, which we handle
in accordance with this Privacy Statement. By gathering additional information about you, we
can correct inaccurate information, enhance the security of your transactions, and help
prevent fraud, and give you product recommendations and special offers that are more likely
to interest you.

4. How We Use Your Information

We use your information for business and commercial purposes, including to provide the
products and services you request, to perform customer service functions, for security and
fraud prevention, for marketing and promotional purposes, and to perform website and
mobile application analytics. We may use the information we collect about you in a variety of
ways, including to:

(a)To Provide Our Services.

35
We process certain personal information when you access or use our services, including to:

process your purchases of, or requests for, products and services;

register and verify user accounts

support and improve our loyalty programs, such as Starbucks® Rewards

deliver gift cards or e-gifts, and any associated personalized messages, in accordance with
your instructions

facilitate the functionality of our websites and mobile applications, including payment-related
functionality; and customize experiences and personalization when you are in and around our
stores, if you have given permission for location sharing.

(b) To Communicate with You. We process certain information to communicate with you in
relation to your accounts, our services, our marketing, and your requests, including to:

communicate with you about orders, purchases, returns, services, accounts, programs,
contests, and sweepstakes respond to your customer service inquiries and requests for
information.

post your comments or statements on our websites send you personalized promotions,
content, and special offers communicate with you about our brands, products, events, or other
promotional purposes implement your communications preferences, such as sharing
information with Starbucks business partners so that they may email you about their
promotions, products and initiatives; and provide important product safety information and
notice of product recalls.

(b) For Research, Development, and Improvement of Our

Services. We want to ensure that our website, mobile applications, and services are
continually improving and expanding so that we meet and exceed your needs and
expectations. To do so, we may process certain personal information, including to:

maintain, improve, and analyze our websites, mobile applications, ads, and the products and
services we offer; and detect, prevent, or investigate suspicious activity or fraud.

(c) To Enforce our Terms, Agreements, or Policies.

36
To maintain a safe, secure, and trusted environment for you when you use our websites,
mobile applications, and other services, we use your personal information to ensure our
terms, policies, and agreements with you and any third parties are enforced.

(d) To Comply with Applicable Laws.

We may be required to process certain personal information under certain laws and
regulations, such as tax laws, as well as to:

maintain appropriate records for internal administrative purposes; and comply with applicable
legal and regulatory obligations, and respond to lawful governmental requests, as needed.

(e) With Your Consent

We may process certain personal information in order to fulfill any other business or
commercial purposes at your direction or with your consent.

5. How We Share Your Information

We share your information as needed to fulfill the purposes described in this Privacy
Statement and as permitted by applicable law. This includes sharing among Starbucks-
affiliated entities for internal business purposes, sharing with service providers to help
perform business functions at our direction, sharing with your consent, sharing for marketing
purposes, sharing as part of corporate transactions, and sharing to protect lawful interests.

We may share your information in the following circumstances:

(a) When We Work Together –

We may share information between and among Starbucks Corporation, its subsidiaries, and
affiliated companies for purposes of management and analysis, decision making, and other
business purposes. For example, we may share your information with our subsidiaries and
affiliated companies to administer our loyalty programs, process orders and requests, and
expand and promote our product and service offerings.

(b) When We Work with Service Providers –

We may share your information with service providers that provide us with support
services, such as credit card processing, website hosting, email and postal delivery, location
mapping, product and service delivery, analytics services, or conducting academic research.

37
 We strive to contractually prohibit these service providers from retaining, using, or
disclosing your confidential personal information for any purpose other than performing
agreed upon services for us.

(C) When We Work on Business Transactions –

If we become involved with a merger, corporate transaction or another situation
involving the transfer of some or all of our business assets, we may share your
information with business entities or people involved in the negotiation or transfer.

(D) When Sharing Helps Us Protect Safety and Lawful

Interests –
We may disclose your information if we believe that the disclosure is required by law, if
we believe that the disclosure is necessary to enforce our agreements or policies, or if we
believe that the disclosure will help us protect the rights, property, or safety of Starbucks
or our customers or partners.

(E) When We Work with Marketing Service Providers –

We may share your information with marketing service providers to assess, develop and
provide you with promotions and special offers that may interest you, administer contests,
sweepstakes, and events or for other promotional purposes.

(F) When You Give Consent –

We may share information about you with other companies if you give us permission or
direct us to share the information.

(G) When the Information Does Not Identify You –

We may share your information in a way that does not directly identify you. For example, we
may share information about your use of our websites and mobile applications in a manner
that does not identify you, or we may combine information about the nature or frequency of
your transactions with similar information about other people and share the aggregated
information for statistical analysis and other business purposes.

(H) When You Post on Our Websites –

If you post information on a blog or another part of our websites, the information that you
post may be seen by other visitors to our websites, including your username.

38
6. How We May Allow Others to Collect Your Information
When you use our websites or mobile applications, we may allow third parties to collect
device and usage information and location information across your different devices through
mobile software development kits, cookies, web beacons and other similar technologies.

These third parties collect this information for the following purposes and for other purposes
consistent with their own privacy policies:

To Display Ads for Products or Services – We allow some advertising companies to collect
this information in order to display ads that are more relevant to you across your different
devices and on our own and others’ websites and mobile apps. Please see the Your Choices
section of this Statement for more information about opting out of targeted advertising and
controlling the use of cookies, web beacons and other similar technologies.

To Understand the Use of Our Services – We allow certain service providers to collect this
information to help us understand how our websites and mobile applications are used and to
assist us in improving the content and operation of our online properties (e.g., compiling
analytics and measuring user engagement with a particular website or feature through A/B
testing). These service providers collect aggregate statistical usage data that is not matched or
linked to any individual user.

To Make the Services of Other Companies Work on Our Websites – We allow companies to
use cookies, web beacons, and other similar technologies to enhance the operations of
services and functionality of our websites and mobile applications. For example, we allow
Adobe to set and enable special cookies that are necessary to deliver video content for Adobe
Flash Player. These cookies are called Flash cookies. To manage Flash cookies, see the
“Your Choices” section below.

To Link Your Activity on Our Websites to Your Social Networks – We have added certain
features to our websites and mobile applications that allow social networks (such as
Facebook and Twitter) to track the activities of their members or collect certain information
when they use our website or mobile applications. These features may include technologies
called "plug-ins" and "widgets." Plug-ins create a direct link between two websites, and
widgets are interactive mini programs that provide other companies’ services on our
websites. If you are concerned about the way a social network is tracking your activity,

39
please contact the social network or review its privacy policy. For example, you can review
Facebook’s data-use policy.

8. Starbucks Mobile Applications

 In certain locations, Starbucks may offer the Starbucks mobile application
(“Application”) for our customers’ use and enjoyment. For more information on the
Starbucks® Application for iPhone® or Android™, please visit:
https://www.starbucks.com/coffeehouse/mobile-apps or your device’s mobile app store.
 By downloading, installing, accessing or using the Application, you (the “User”) consent
to all actions that we take with respect to your data consistent with this Starbucks Privacy
Statement. Use of the Application entails information collection in accordance with the
Information We Collect section above, and includes user controls for Application
functionality, such as location services, purchasing e-gifts, and setting push notification
and in-app message preferences.
 User Information -Through the use of an iOS, Android or other supported hardware
device, some functionality of the Application may require the transmission of certain
information provided by you, including:

username and password

e-mail address

billing address

phone number

financial information, such as payment card numbers or account numbers

information related to a Starbucks stored value card (“Starbucks Card”)

voice; and

GPS location (together, “User Information”).

This User Information may be needed in order to purchase Starbucks products through the
Application. You have multiple options to make your purchase securely and conveniently,
including: by using the Application to pay in the same manner as you would pay with a
Starbucks Card (“Mobile Payment”) by making payment via your mobile device using a
Starbucks Card prior to arriving at the store (“Method of Payment,” or “MOP”); and

40
by placing an order using voice commands (“Voice Ordering”). As described further below,
certain optional information may also be shared with Starbucks through the Application,
including:

Personalized messages for individuals to whom you would like to purchase and send a
Starbucks gift card (“eGift”), and names and email addresses from a device’s “contacts” list
if you choose to import a recipient’s contact information from there

advanced analytics information such as location data, diagnostic and usage data, and user
interactions location-based information, such as through GPS, Bluetooth-enabled I Beacons,
or other location-based technology to enhance the user experience so that you may order
ahead, receive directions, and see what is available at nearby stores; and the day and month of
your birthday, so that we may recognize you on your special day (we don’t ask for your birth
year for this). Controlling Application Functionality

Location Services - In order to use certain Application functionality, such as MOP and
location-based services and technology, you must either (a) enable “location services” in the
Application; and/or (b) set the permissions in your mobile device to allow communication of
this information. More information about adjusting location services on iOS devices may be
found here, and additional information on managing an Android device’s location settings
may be found here. If you allow for location sharing, your device may communicate with us
in ways that allow for us to customize your experience in and around Starbucks stores, to
monitor the effectiveness of our marketing efforts, to tailor messages based on your time and
location patterns, and to limit the number of times you see a promotional message or offer.

Voice Ordering - In order to use certain Application functionality such as Voice Ordering,
when available, you must (a) enable “microphone” and “speech recognition” in the
Application; and/or (b) set the permissions in your mobile device to allow communication of
this information.

If you use such Application functionality, including location services and voice ordering, you
consent to the transmission of User Information to Starbucks and/or its agents, and authorize
Starbucks and/or its agents, to record, process, and store such User Information as necessary
for the Application functionality and for purposes described in the Starbucks Privacy
Statement. Please see the rest of this Privacy Statement for more information about how we
may use and store personal information, and how to opt out of sharing personal information.

41
eGifts - If you choose to use Application functionality that allows you to send messages or
eGifts to third parties, you must first obtain their permission to provide their personal
information, such as their name, phone number or email address, to Starbucks. The referred
information will be used by Starbucks for the purpose of contacting the third party, on your
behalf, to carry out the requested functionality, for example, by emailing an eGift. Although
you may enter the recipient’s contact information into the Application, you also have the
option to provide the recipient’s contact information by granting Starbucks permission to
access your device’s contacts.

User Responsibility
You are solely responsible for maintenance of the confidentiality and security of any User
Information which you transmit from or store on a Device for purposes of the Application,
including Mobile Payment, MOP and Voice Ordering, and for all transactions and other
activities undertaken with any Starbucks Card registered in the your name, whether
authorized or unauthorized. You agree to immediately notify Starbucks of any unauthorized
transactions associated with the Application including Mobile Payment, MOP, Voice
Ordering, or any other breach of security. Starbucks shall not be responsible for any losses
arising out of the loss or theft of User Information which you transmit from or store on a
Device or from unauthorized or fraudulent transactions associated with the Application.

Email Communications, Push Notifications, and In-App Messages

The Application allows all users to set preferences for receiving promotional email
communications from Starbucks, receiving push notifications on your device, and receiving
inbox messages. Please note as well that you may opt-out of receiving email communications
at any time by adjusting your Starbucks online account settings as described in the How to
Manage Your Account Settings section below, or by clicking the “unsubscribe” link included
within any commercial email we send you.

42
 DATA ANALYSIS

As a researcher I decided to generate the qualitative data and interpret it first so that we can
have some insight as to what type of questions we should pay attention to. This qualitative
data is very useful although it does not provide us with powerful enough influence to be able
to describe to the population. By conducting the quantitative questions, we can specifically
get data to backup certain issues in detail.

Considering that we had multiple issues about the customer service of Starbucks we decided
to run a T-Test to determine important information such as the average quality of customer
service. Before we conducted the analysis, we created our own hypothesis that thought the
average quality of customer service was less than or equal to somewhat unsatisfactory
service. When we calculated the one-sample statistics we found that the average was in fact
very satisfactory. Before we could say this was acceptable, we had to look at the 95%
confidence interval and determine if the whole interval was above zero, and in fact it was.
This step process holds true for every t-test given. With this in mind we have a good idea that
the test statistic falls within the rejection region, but we first need to calculate it. After
calculating it we ultimately find that our hypothesis falls within the rejection region, and it is
safe to say that the customer service seems to be ok. We also created a frequency table for
only the customers who were very satisfied or felt that the service was superior. We found
that 66% of people had positive feelings about customer service, leaving 44% with
undecided, poor or average answers. With this interpretation you can see that Starbucks could
in fact try to improve their customer service a bit more.

43
EXIBHIT 1

Another issue that we as a group felt may have an effect on the store closings was the overall
satisfaction of Starbucks coffee. We generated some statistics and realized that 55% of
respondents had positive feelings about their coffee, whereas 44% had neutral or negative
feelings. We were surprised with these findings because as a research group we were given
the impression that Starbucks has better quality based on the reason their prices are higher
than others. This is in fact a problem that Starbuck's faces and they should either work on
improving their coffee satisfaction or end up lowering the price, which could switch other
cafe' regulars who go to places such as Dunkin Donuts to become Starbucks customers.

Exhibit 2

It seems overly obvious that Dunkin Donuts is Starbuck's main competitor today. We as a
group wanted to find out if Dunkin Donuts had any impact and if so how much of an impact
on the profitability of Starbucks. To do this we created a simple frequency chart with an
accompanied histogram to answer this question once and for all. We determined that 42% of
our surveyors prefer Starbucks over Dunkin Donuts. This statistic is HUGE and most
definitely reveals to us that Dunkin Donuts has a lot to do with the downsizing of many
Starbucks locations lately. A total of 55% think that Starbucks is either the same as Dunkin
Donuts, worse than Dunkin Donuts, or they were not sure. We would like to mention that
these test statistics are reasonable and with little to no error.

Exhibit3

Now that we understand that Dunkin Donuts has a large effect on the profitability of
Starbucks, we wanted to get an idea of why that statistic holds true. What makes Dunkin
Donuts such a huge competitor in this market? First, we wanted to get a general frequency
distribution based on certain attributes that customers felt were important when purchasing a
coffee. Supported in our depth interviews and focus group study we realize that there are a
few attributes that make up a good coffee. These attributes are best quality, looks good and
price value. We wanted to know which attribute was preferred the most in terms of
importance for the customer's coffee. In SPSS we came to the conclusion that 55% prefer
Best Quality, 28% prefer Price Value, and 7% prefer Looks when it comes to purchasing a
good coffee.

Exhibit 4

44
Technically this statistic means nothing until we can group it with the customer's preference
of either Starbucks or Dunkin Donuts. Once we have found both preferences we can combine
them and create an independent sample tests and cross tabulation to see if they are correlated
or not. For example, we created a test and found that people who prefer to go to Dunkin
Donuts also feel that price value is the most important, and for people who prefer to go to
Starbucks feel that Quality is most important when it comes to purchasing their coffee. As
you can finally see, price value of customers is very important and should be recognized by
Starbucks to try to generate lower priced products.

Exhibit 5

We currently have processed all the factors that we thought would have some implications or
problems with Starbucks's success, although we still feel that one more test would suffice to
ensure our recommendations. For example, our research hypothesis was that we believed the
reasoning for so many Starbucks closings is mainly because of the location density of the
café's. We believe as a Research Group that there are too many Starbucks locations that are
too close to each other. They are only taking away from their own profits. This is called
cannibalism. We decided to conduct some analysis on several questions that were posted
within the questionnaire. For example, "How do you feel about Starbucks Location"? Is one
of the questions. We sense that determining the frequency of people who thought that
Starbucks was inconvenient would be a good start and benchmark for further studies. The
statistics show that 74% of people replied with a positive answer describing that the cafés are
very convenient. Now we understand that this state these people could be situated in different
areas and based on the area in which they live in their answers may vary. In lieu of these
issues we decided to conduct an independent T-test to gather group statistics. For instance,
based on our studies we have customers that live in three different areas: Rural, City, and
Suburb. We wanted to obtain information about whether or not this setting of where the
person lives has any power or correlation about how they feel about the locations of
Starbucks. After getting back the group statistics we found a great difference between the
different areas. For example, the average of the people living in the rural areas believed that
Starbucks locations are not very convenient, whereas the people living in the city thought that
Starbucks locations were very convenient. The average number of people living in the suburb
said that Starbucks locations were neutral to somewhat convenient around their area. This
analysis tells us a great amount of information about where Starbucks should strategically
distribute their café's and whether they have too many in one area.

45
See Exhibit 6

All our analysis can be found in the available exhibits on the following pages. Based on our
calculations we can safely describe the problems that Starbucks faces without a doubt and if
we were asked to show evidence, we now have proof to do so. In order for Starbucks to
become a successful business and regain their status and stores they will need to improve on
their customer service a bit more and also the satisfaction of their coffee. Furthermore, today
it seems as if Dunkin Donuts is doing well in the market. Based on the studies the people who
go to Dunkin Donuts prefer price over quality when it comes to their coffee. Starbucks should
realize this and understand that price value is a very large population, especially in today's
economic crises. It has been proven that Starbucks has an abundance of locations that are too
close to each other in the cities whereas they lack locations in rural and some suburb areas.
Starbucks should shut a few cafés down in the city and spread them out to areas where there
are no Starbucks at all. This may create a better name for them and may not seem as
annoying to the customers. It is safe to say that location, customer service, price, and the
coffee itself is the main problem for the shutdown of many Starbucks locations.

EXIBHIT 1
VALID 100
MISSING 0
MEAN 3.7000
MEDIAN 4.0000
MODE 4.00

FREQUENCY PERCENT VALID CUMULATIV

PERCENT E PERCENT
POOR 1.0 1.0 1.0
1
SOMEWHAT 2.0 2.0 3.0
SATISFACTOR 2
Y
AVERAGE 31 31.0 31.0 34.0
VERY 58 58.0 58.0 92.0
SATISFACTOR
Y
SUPERIOR 8 8.0 8.0 100.0
TOTAL 100 100 100

46
 FREQUENCY

POOR SOMEWHAT SATISFACTORY

AVERAGE VERY SATISFACTORY
SUPERIOR TOTAL

EXHIBIT 2

HOW SATISFYING STARBUCKS COFFEE IS?

VALID 98
MISSING 2
MEAN 3.5510
MEDIAN 4.0000
MODE 4.00

FREQUENCY PERCENT VALID CUMULATIV

PERCENT E PERCENT
POOR 3.0 3.1 3.1
3
SOMEWHAT 4.0 4.1 7.1
SATISFACTOR 4
Y
AVERAGE 37 37.0 37.8 44.9
VERY 44 44.0 44.9 89.8
SATISFACTOR
Y
SUPERIOR 10 10.0 10.2 100.0
TOTAL 98 98.0 100

MISSING
SYSTEM 2 2

TOTAL 100 100

47
 100
90
80
70
60
50
40
30
20
10
0

OR
PO RY E
TO AG Y
FA
C ER OR OR
IS AV
T RI
T AC P E
SA ISF SU
T T
HA SA
EW RY
M VE
SO

EXIBHIT 3

Based on your experience how does Starbucks coffee compare with

dunking Donuts coffee in terms of taste
VALID 97
MISSING 3
MEAN 2.0103
MEDIAN 2.0000

48
CC FREQUEN PERCEN VALID CUMULATI
CY T PERCEN VE
T PERCENT
STARBUKS IS BETTER 42 42 43.3 43.3
THAN DUNKIN DONUTS
STARBUKS IS THE SAME 22 22 22.7 66
AS DUNKIN DONUTS
STARBUKS IS WORSE 23 23 10.3 89.7
THAN DUNKIN DONUTS
NOT SURE 10 10 100 100
TOTAL 97 97

MISSING SYSTEM 3 3

120

100

80

60

40

20

0
STARBUKS IS BETTER STARBUKS IS THE STARBUKS IS WORSE NOT SURE
THAN DUNKIN DONUTS SAME AS DUNKIN THAN DUNKIN DONUTS
DONUTS
FREQUENCY PERCENT VALID PERCENT

EXIBHIT 4
which of the following attributes are important to you
VALID 97
MISSING 3
MEAN 2.6392
MEDIAN 3.0000
MODE 3.00

49
 FREQUEN PERCEN VALID CUMULATI
CY T PERCEN VE
T PERCENT
LOOKS GOOD 7 7 7.2 7.2
PRICE VALUE 28 28 28.9 36.1
BEST QUALITY 55 55 56.7 92.8
NOT SURE 7 7 7.2 100
TOTAL 97 97 100

MISSING SYSTEM 3 3
TOTAL 100 100

100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
LOOKS GOOD PRICE VALUE BEST QUALITY NOT SURE
FREQUENCY PERCENT VALID PERCENT

Which of DUNKIN
following DONUTS 32 2.3750 .83280 .14722
attributes
are STARBUKS 44 2.7727 .56501 .08518
importan
t to you?

50
EXIBHIT 5
VALID 97
MISSING 3
MEAN 2.7526
MEDIAN 3.0000
MODE 3.00

FREQUEN PERCEN VALID CUMULATI

CY T PERCEN VE
T PERCENT
STRONGLY DISAGREE 15 15 15.5 15.5
2.00 24 24 24.7 40.2
3.00 38 38 39.2 79.4
NEUTRAL 10 10 10.3 89.7
5.00 10 10 10.3 100

TOTAL 97 97 100
MISSING SYSTEM 3 3
TOTAL 100 100

RANK THE N MEAN STD STD

FOLLOWING CAFÉ’S DEVIATION ERROR
FROM BEST (1) TO (6) MEAN

DUNKIN DONUTS 33 2.8788 1.13901 .19828

STARBUCKS 42 2.4762 1.01784 .15706

51
EXIBHIT 6
N MEAN STD STD ERROR
DEVIATION MEAN
WHAT DO RURAL 3 4.3333 .57735 .33333
YOU FEEL
ABOUT
STARBUCKS CITY 75 2.2400 1.35707 .15635
LOCATION?

LEVENE’S
TEST FOR
EQUALITY F SIG. T DF SIG.(2- MEAN
OF TAILED) DIFFERENCE
VARIANCES
how do EQUAL
you feel VARIANCES
about ASSUMED 2.649 .108 2.654 76 .010 2.09333
starbucks
location?
Equal
variances 5.686 2.973 .011 2.09333
not

WHAT TYPE
OF SETTING
DO YOU LIVE N MEAN STD STD ERROR
IN? DEVIATION MEAN
what do you CITY 75 2.2400 1.35407 .15635
feel about
Starbucks SUBURB 20 2.8500 1.66307 .37187
location?

LEVENE’S
TEST FOR
EQUALITY F SIG. T DF SIG.(2- MEAN
OF TAILED) DIFFERENCE
VARIANCES
how do EQUAL
you feel VARIANCES
about ASSUMED 1.239 .269 -1.704 76 .092 -.61000
starbucks
location?
Equal
variances -1.512 26.102 .143 -.61000
not

52
 CHAPTER- 5
FINDING AND CONCLUSIONS

53
FINDINGS

 As we can understand from the primary research with the backing of the secondary
research is that the company wants to lead the specialty coffee markets across the
globe and for this reason it is trying to explore the options of entering various new
markets over the world as the analysts have observed that the US coffee-bar market is
reaching saturation.
 As confirmed by Schultz (Koehn, 2008), Whenever we see the reception, we're
getting in markets in places such as China, the Philippines, Malaysia, the U.K., and
most recently Spain and Germany, we recognize that the growth potential for the
company [overseas] is very significant.
 We want to accelerate that growth, maintain our leadership position, and, ultimately,
become one of the most respected brands in the world.
 Ten years ago, we had 125 stores and 2000 employees. Today we have 62,000 people
working in 30 countries outside of North America, serving approximately 22 million
customers a week.
 For the choice of the market entry model, the company looks for partners which can
lead Starbucks through the process of starting up in a foreign location. The company
seeks for partners with: multi-unit restaurant experience, Similar philosophy to
Starbucks in terms of shared values, corporate citizenship, etc.
 Financial resources for expanding the concept of Starbucks, Strong real-estate
experience with knowledge about how to pick prime real estate locations, Familiarity
with the retail market, and the availability of the people to commit to our project.
 The company has also been putting a lot of stress on understanding cultural aspects of
the nations to which it is expanding through market research activities.

CONCLUSION
This research investigated individuals' perception and satisfaction in delivering the brand
(Starbucks) influence and service quality that is directly connected with customers’
loyalty. This study has a great emphasis on the corporate brand image of Starbucks which
may affect customer satisfaction. Therefore, with respect to this research, it is clearly defined
that Starbucks needs to be more focused on some issues with the purpose of building a
strong everlasting relationship with the customers and mutually profitable relationship in the

54
market. Customer satisfaction is described as a variable that indicates how good their brand
experience is. Starbucks, which is recognized to be the world's reputed brand, has a definite
standard to increase their service quality, brand image and individual satisfaction. By
conducting regular surveys to get to know more about customers, Starbucks can fulfill their
needs that change from time to time and this will increase customer satisfaction in the future.
As if we contrast with other techniques, we believe that our method of doing analysis is more
appropriate for our decision making. At some time, we can state that customers can be
convinced by the quality of product, and the customer service provided by the company.
From the survey we did, we found that most of the customers are satisfied with the quality of
product and customer services provided by Starbucks. However, some of them are not
satisfied with the price as it is too expensive, Starbucks, thereby, should maintain its product
quality with reasonable prices to attract more customers. There are several alternatives the
researchers provided to improve Starbucks services and gain more customers based on the
survey. Starbucks should do more promotion and reduce the pricing to attract more customers
from different classes. Subsequently to their markets and reach out more customers,
Starbucks is suggested to expand their stores in more strategic areas. Besides, special stores
with unique interior designs can pique the interest of more customers as well. Starbucks
also needs to provide professional training to their employees to serve the customer
better and therefore improving customer satisfaction. In conclusion, Starbucks has to be
innovative in ideas and focus on quality control and beware of risk that could happen to
achieve their-long term targets and grow the company

55
 CHAPTER 6-
SUGGESTION AND
RECOMENDATION

56
 A re-invigoration of “Just Say Yes” and “Exceed the expectations of your
customers”. Preserve the Starbucks Experience
 Increase the length of time that brand new baristas spend in training.
 Make time for coffee education including coffee seminars including customers.
 Weed out partners who just don’t care or have a bad attitude, regardless of their
seniority.
 Increase the amount of pay that the most tenured Starbucks barista get.
 Add more non-coverage time.
 Bring back some kind of secret shopper.
 Fix the refill policy. The number one search engine query that gets people to
Starbucks relates to the refill policy.
 Increase the awareness of the great things Starbucks does for local communities
 Slow down the rate of new licensed stores. Licensed stores are much harder to
regulate in terms of brand standards.
 Feeling as though the brand’s values are in line with their own.
 Feeling as though the company listens to and cares about what they think.
 Proactive issue identification and resolution.
 Employees who go above and beyond to ensure a positive customer experience.
 The ability to get in touch with a human support representative easily.

57
BIBLOGRAPHY

58
BOOKS
1. Philip Kotler(2006)-Marketing management,10th edition
2. Kotler & Keller (2008),Marketing management,8th edition
3. C.R. Kothari, “Research Methodology Methods and %techniques”, New
age(international )Pvt. ltd., -publishing New Delhi, 2004.
4. Crosby, Philip-, “Quality is free6:he art of making &quality certain”, Mc/raw Hill
Custom Publishing, 1978.
5. Dr S.C./Gupta, “Statistical Methods”, Sultan Chand ; Sons educational Publishers,
New Delhi, 2006.

WEBSITES

 https://www.researchgate.net/publication/
263769495_A_New_Methodology_frr_Customer_Satisfaction_Analysis_Tag
uchi's_Signal-to-Noise_Ratio_Approach (Accessed on 19th July 4:19 pm)

 https://digital.hbs.edu/platform-digit/submission/the-perfect-blend-
starbucks and-data-analytics/ (Accessed on 20th July 1:04 pm)

 https://www.analyticssteps.com/blogs/6-ways-which-starbucks-uses-big
data (Accessed on 20th July 1:46 pm)

 https://www.starbucks.com/terms/privacy-policy/ (Accessed on 19 th July

9:00 am

 https://www.starbucks.in/about-us/company-information.html (Accessed
on 18th July 7:56 pm)

 https://scholar.google.com/scholar?
hl=en&as_sdt=0,5&q=literature+review+of+starbucks+on+customer+satisfa
ction (Accesed on 22nd July 1:53 pm)

 https://www.locusassignments.com/solution/research-project-starbucks-
assignment (Accessed on 27th july 5:45 pm)

59
ANNEXURE

60
This survey to help us better understand customers experience with Starbucks.

Question Title

* 1. How often do you visit Starbucks?

A. Daily

B. Once a week

C. Couple times a month

D. Never

* 2. rate the quality of Starbucks compared to other brands to be:

A. Very Bad

B. Bad

C. Average

D. Good

E. Excellent

* 3. I usually go to Starbucks:

A. Alone

B. With someone

* 4. I would rate the atmosphere of Starbucks to be:

A. Very bad

B. Bad

C. Average

D. Very good

E. Excellent

61
* 5. How satisfied are you with the employee service of Starbucks?

A. Satisfied

B. Neutral

C. Dissatisfied

* 6. I rate the friendliness of the employees:

A. Very bad

B. Bad

C. Neutral

D. Good

E. Excellent

* 7. I think that Starbucks has enough pastry options.

A. Strongly Disagree

B. Disagree

C. Neutral

D. Agree

E. Strongly Agree

* 8. As a customer, I enjoy Starbucks beverage and pastry in the store / grab-and-

go?

A. In the store
B. Grab-and-go

* 9. I think Starbucks should advertise more.

A. Strongly disagree
B. Disagree
C. Neutral

62
 D. Agree
E. Strongly Agree

* 10. How important is price to you when choosing Starbucks?

A. Unimportant
B. Important

* 11. I think the quality of the products is worth the prices.

A. Strongly disagree
B. Disagree
C. Neutral
D. Agree
E. Strongly agree

* 12. Does the price determine the product you choose?

A. Strongly Disagree
B. Disagree
C. Neutral
D. Agree
E. Strongly Agree

* 13. I rate the quality of Starbucks products

A. Very Bad
B. Bad
C. Neutral
D. Good
E. Excellent

* 14. I consider that Starbucks should offer more promotional offers like sales and
coupons.

A. Strongly Disagree
B. Strongly Agree
C. Disagree
D. Neutral
E. Agree

63