Starbucks Case

Since its inception in 1987, Starbucks vision had been to create an intimate environment for its customers to experience the coffee culture of relaxing and interacting with one another and the Starbucks partners. Starbucks mission was to provide quality coffee to its customers, create a place where the customers can build a connection with the baristas and with each other, and provide excellent customer service and experience. Based on this vision, I will now evaluate and analyze the company’s initial strategy and the growth initiatives undertaken by it.

When Starbucks was launched, it faced a challenge. Coffee was a commodity in North America and its consumption had been on a downfall since mid-1960. So Starbucks had to be diligent in targeting customers who valued coffee. Its target market included people who were coffee purists, were educated and informed enough to differentiate quality coffee from cheap coffee, were willing to pay a premium price and had an open mind to try new flavors. Also, these people believed that coffee can be enjoyed outside of their homes, and it was possible to build a connection over a cup of coffee. Being fanatical about quality control, Starbucks positioned itself as a high end coffee brand. At the same time, it positioned itself as something more than just coffee, a ‘Third Place’ experience which can result into building powerful connections and communities that linger over a cup of quality coffee. As a result of this positioning, Starbucks paid much attention to the ambience of its stores, from the layout, to the furniture and to the music. In terms of the products being offered, initially, Starbucks focused on selling just coffee the coffee purists’ way. There were not many options in terms of milk or cold beverages. Food and entertainment options (except playing music in store) were not introduced until later, when the focus shifted to growth. The coffee was priced high due to the exceptional quality and the experience which...