Starbaucks Case Analysis

Starbucks: Delivering Customer Service

Problem Statement Due to the emergence of a new demographic segment of customers, a mismatch between Starbucks’ marketing strategy and the expectations of its clients has developed. The current Starbucks’ strategy addresses the needs of the established customer group, but not the expectations of the emerging customer segment. This has led to a ‘service gap’. Situation Analysis In 2002, Starbucks realizes that customer satisfaction is below the company’s target and it discovers that the brand image has developed some “rough edges”1. To solve this issues, the senior vice president of administration in N. America, Christine Day, proposes spending an extra $ 40 M per year to increase the number of staff with the objective to improve satisfaction through increased speed of service. However, the results of the 2002 market research and case analysis reveal that: ● Cleanliness, convenience and being treated as a valuable customer were the top three key factors for customer satisfaction, while fast service appeared in the seventh place in the ranking.2 ● 19% of customers would like the staff to improve its friendliness, while only 10% of customers would value a faster service.3 ● There was a considerable difference between the overall satisfaction opinions of new and established customers regarding Starbucks: 25% and 44%,

respectively.4

1 2

See Appendix A in Page 5 Information obtained in Exhibit 10: Importance Rankings of Key Attributes in Creating Customer Satisfaction 3 Information obtained in Exhibit 11: Factors Driving “Valued Customer” Perceptions 4 Information obtained in Exhibit 8: Customer retention information.

Team J

1

Starbucks: Delivering Customer Service

● The evaluation of the Customer Snapshot was very positive and was constantly improving in the last five quarters. Particularly, average wait time was three minutes and six seconds in the last quarter.5 ● Day targets a sales increase of 30% ($ 20.000...