social Media to enhance Brand Equity v9
Introduction
Starbuck’s CEO, Howard Schultz, asked an interesting question, “What would happen if one takes the high-quality coffee from Starbucks and connects it with the charm and atmosphere of European cafes?”1 (Mangold, 2013). A good question always leads to a good insight. Starbucks, commenced its business in 1971, has revolutionized the coffee business and created a new market by offering exceptional quality coffee from around the world. It becomes the world leader in the premium coffee market with more than 19,000 stores around the world in 62 countries. However, by 2008, the firm was rapidly losing customers to other competitors who also offered fresh-brewed coffee such as Pacific Coffee and McDonald’s café. This triggered Starbucks to rethink what customers really wanted from a coffee shop and extended connections with them beyond the coffeehouse. Hence, a journey into social media began.
Research Question
This paper is to explore how Starbucks utilizes the social media platform to enhance its brand equity
Literature Review
Social Media is termed that customers are now ‘social customers’ and every interaction is an engagement and collaboration between company and customer. Social media is defined as “the technological component of the communication, transaction and relationship building function of a business which leverages the network customers and prospects to promote value co-creation.”2 (Andzulis, J. M, Panagopoulos, N. G., Rapp, A., 2012).
The social media has revolutionized the traditional branding paradigm which tightly managed the image through controlled communications to create dominant brands and hence cultivate loyalty and profits. Traditionally, marketing communication entailed significant financial investment in advertising and promotion budgets in order to gather marketplace attention and develop loyalty and repurchase of the brand. Once customers develop a preference for a brand, they will patronize it because of assurance
Starbuck’s CEO, Howard Schultz, asked an interesting question, “What would happen if one takes the high-quality coffee from Starbucks and connects it with the charm and atmosphere of European cafes?”1 (Mangold, 2013). A good question always leads to a good insight. Starbucks, commenced its business in 1971, has revolutionized the coffee business and created a new market by offering exceptional quality coffee from around the world. It becomes the world leader in the premium coffee market with more than 19,000 stores around the world in 62 countries. However, by 2008, the firm was rapidly losing customers to other competitors who also offered fresh-brewed coffee such as Pacific Coffee and McDonald’s café. This triggered Starbucks to rethink what customers really wanted from a coffee shop and extended connections with them beyond the coffeehouse. Hence, a journey into social media began.
Research Question
This paper is to explore how Starbucks utilizes the social media platform to enhance its brand equity
Literature Review
Social Media is termed that customers are now ‘social customers’ and every interaction is an engagement and collaboration between company and customer. Social media is defined as “the technological component of the communication, transaction and relationship building function of a business which leverages the network customers and prospects to promote value co-creation.”2 (Andzulis, J. M, Panagopoulos, N. G., Rapp, A., 2012).
The social media has revolutionized the traditional branding paradigm which tightly managed the image through controlled communications to create dominant brands and hence cultivate loyalty and profits. Traditionally, marketing communication entailed significant financial investment in advertising and promotion budgets in order to gather marketplace attention and develop loyalty and repurchase of the brand. Once customers develop a preference for a brand, they will patronize it because of assurance