Marathon Training

STARBUCKS

Starbucks’ corporate strategy has been to establish itself as the premier purveyor of the finest coffee in the world, while maintaining their uncompromised principles as they grow (Starbucks, 2012). A key reason for Starbuck’s initial success has been the concept of its stores as a place for socialization between home and work. They encourage customers to spend time relaxing in their stores and enjoy the Starbucks “experience”. This differentiation portrays them as an upscale brand, allowing them to charge a premium price for their products.

Starbucks competitors include Dunkin’ Donuts, Caribou Coffee, and McDonald’s. McDonald’s is the most formidable because it has an extensive menu, an established customer base, and brand name recognition.

Strengths: As the market leader in the premium coffee market, Starbucks has an established logo, a developed brand, and high brand equity. It is a profitable company with vertical integration to maintain their high quality standards. They are supporters of Fair Trade practices and address environmental concerns in the US and abroad. A global presence with stores operating in 40 countries, each store is in a high traffic, high visibility, convenient location. Customer satisfaction with the quality and taste of coffee is high because of product consistency throughout all locations. Excellent customer service is provided by a large number of valuable, motivated employees – Starbucks has been listed on Fortune’s “100 Top Companies to Work For” 14 years in a row. To compete with McDonald’s menu, they have expanded their food offerings, concentrating on adding healthy options.

Weaknesses: Starbucks has a large domestic dependence – three fourths of their locations are in the US. The global economic downturn has resulted in lower consumer traffic with lower than average dollar per transaction, because their coffee is expensive and most consumers view Starbucks as a luxury item. To support Fair Market...