Starbcks

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1. What was Starbucks Strategy? That is, what are they really selling? In the mind of Howard Schultz, the current CEO and founder of Starbucks, the intended Starbucks Strategy is to create the “Starbucks Experience” (the Experience) for their loyal customer base, both in the North American markets as well as countries around the world. The Experience focuses on providing a much consumed Italian style coffee in stores with an atmosphere which encourages long visits by providing an aesthetically pleasing upscale environment often reminiscent of the local community, amenities such as WIFI connection, the offering of snacks to complement their main product, and store placement in shopping centers, book stores, and even airports. Starbucks was initially able to accomplish this strategy with few competitors by distinguishing its product as high quality and the placement of its stores for the convenience of consumers. The nature of Starbucks operations also contributed to this experience. The employees responsible for customer service are referred to as partners versus staff and received wages and benefits above those that could be found in similar customer service jobs fostering a sense of pride and ownership in the services they provide to Starbucks customers. Also, the company prides itself on corporate and social responsibility by utilizing recycled and environment friendly materials, participating in local community charities and fair trade practices. This sense of responsibility is passed on to customers who are able to feel that they are doing their part by supporting/frequenting a socially conscious business. An emergent strategy that succeeded Mr. Shultz’s departure from Starbucks in 2000 was rapid expansion which included domestic store expansion, international store expansion, and product line expansion. By 2007, Starbucks had 15,700 stores in 37 countries, 115,000 employees and market capitalization of $25 billion. 2. What three or four factors...
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