Starbucks

Starbucks: Recreating the experience
We aren't in the coffee business,

serving people.
We are in the people business,
serving coffee. Howard Schultz.
Summary of the case:

Started in the year 1971 by
three partners- Jerry Baldwin,
Zev Siegel, Gordon Bowker.
Later taken over by Howard
Schultz and became the first
coffee organization to
become a public company.
Mission statement of
Starbucks:
To establish Starbucks as
the premier purveyor of
the finest coffee in the
world while maintaining
our uncompromising
principles as we grow.
Creating the Starbucks experience

It has more than 8000 stores in almost forty
countries of the world.
The Starbucks experience is the combination of
the product, place the people and the brand.
The first step that differentiates Starbucks from
the rest of the coffee industry is finding and
purchasing the best green beans in the world.
The company always looks out for new avenues
for reaching out to its customers like in Starbucks
outlets, airport terminals, office buildings,
suburban retail centers etc.
Continued..
Innovations:
The company invented Frappuccino , a revolution in
coffee.
Collaborated with music business, which helped increase
sales.
In Asia, it offered Starbucks discoveries which represents
first entry into chilled cup coffee segment in the world.
Flavor lock bags helped in rapid expansion.
Location:
The company is noted for its non smoking policy in all
outlets
Size, target population, demographics, psychographics,
pedestrian and vehicular traffic are considered important
for a site.
Continued...
The people:
It aims to create a company culture which cares
about its employees, referred to as partners.
The company does not depend much on
advertising and traditional marketing but on the
in store experience.
The company's retail goal is to become the
leading retailer and brand of coffee in each of its
target markets by selling the finest quality coffee
and related products and to provide unique
Starbucks experience to each customer.
It is built upon superior customer service, building
high degree of customer loyalty.
Indian coffee market

India continues to remain a tea loving nation.
With increase in coffee outlets, and changing age
profile of the population the consumer base
drinking coffee is expanding.
India has potential to accommodate 5000 coffee
retail outlets.
Key players in Indian market are barista, caf
coffee day,gloria jeans coffees, hard rock caf.
Branded coffee retailing in India is at the stage of
growth.
The Indian market is also very price sensitive.
Success factors of Starbucks

One of the most remarkable facets of the
companys evolution is the diverse consumer
base.
The first step that differentiates Starbucks from
the rest of the coffee industry is finding and
purchasing the best green beans in the world
and its careful evaluation
Strong relationship with its growers and suppliers.
Adapting to new marketplaces, comes up with
inventions like Frappuccino, discoveries etc.
Store designs are culturally sensitive.
Third place experience offers a affordable luxury,
a place for social interaction, quick service.
Continued..
People did not know that they need a safe and
comfortable gathering place in neighborhood and
Starbucks provided just that. Its ambitious
expansion strategy succeeded for the same
reason.
Its expansion was successful because it
concentrated on one customer at a time, one
store at a time and one market at a time.
It adopts to the culture of the country where it
operates.
The company does not focus much on promotions
and marketing strategy instead it focuses on high
visibility high traffic caf locations.
Value proposition
Its all about experience
Three components of branding strategy:
Coffee itself: high quality green coffee beans,
carefully found, purchased, roasted and served.
Superior in store experience, quality customer
service building customer loyalty.
Ambience: people dont come only for coffee but
it is the ambience that wants them to stay.
Continued..
Provides a great working environment to the
employees, it always wanted to be the employer
of choice and creates a company culture that
cares about its employees.
Corporate social responsibility as contributing
positively to communities and environment is one
of their guiding principle.
Service innovation.
Post launch- Tata Starbucks in India

According to the latest reports India has been the
fastest market to grow internationally for
Starbucks with 83 stores in three-and-a-half
years.
The company is far from being even profitable at
this pointin 2014-15, Tata Starbucks reported a
net loss of Rs.42 crore on revenues of Rs.171.2
crore.
India is not an easy country to operate in. Last
year, Australian cafe brand Gloria Jeans Coffees
exited India. And Barista, which was bought by
New Delhi-based Carnation Hospitality Pvt. Ltd
last year for a reported Rs.100 crore, is on the
block again
Strategies adopted by Tata Starbucks

to emerge as a leader in India
Tata Starbucks is working on overcoming high
attrition rates and improving its productivity
levels by moving to a five-day week for its 1,200
employees.
Tandoori Paneer sandwich
Chatpata Paratha Wrap
Elaichi mawa croissant
Murg kathi wrap
These are certain Indian flavors introduced in Tata
Starbucks to attract more customers.
Continued..
Starbucks said that it would sell single-origin,

small-lot Arabica coffee from the Tata Nellore
Estates in India in the U.S. for the first time, to
support coffee production and increase roasting
capacity at stores in India.
Starbucks is expected to ramp up its tea

offerings within its domestic stores, introducing
its global tea brand Teavana in the country this
year.
To give the coffee culture a fillip, Starbucks will
focus on millennial centric strategy.
Continued..
Starbucks' millennial-centric focus will also see it
strengthen its digital and mobile delivery
systems.
The coffee chain is also expected to bring its
consumer products division into the country tying up with Tatas for the same.

Starbucks

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How did Starbucks start and what is their mission statement?

What are the components of the Starbucks experience?

Starbucks: Recreating the experience

We aren't in the coffee business,

Summary of the case:

Creating the Starbucks experience

Indian coffee market

Success factors of Starbucks

Post launch- Tata Starbucks in India

Strategies adopted by Tata Starbucks

Starbucks said that it would sell single-origin,

Starbucks is expected to ramp up its tea

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