Starbucks Business Model

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2011
Starbucks Business Model
Entrepreneurial Marketing

Christi Gisca, Andy Negus, Charlotte Smith & Grace Waite

Table of Contents
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Introduction .................................................................................................................................... 3 Background Analysis ....................................................................................................................... 3 Business Model Framework ............................................................................................................ 4 Value Creation................................................................................................................................. 5 Market Factors ................................................................................................................................ 6 Internal Capabilities ........................................................................................................................ 7 Competitive Strategy ...................................................................................................................... 9 Economic Factors .......................................................................................................................... 10 Personal/Investor Factors ............................................................................................................. 11 Conclusion ................................................................................................................................. 11

Appendix 1 – Swot Analysis .................................................................................................................. 13 Appendix 2 – Starbucks Current App Technology Available in USA ..................................................... 16 Appendix 3 - The New Service App Process .......................................................................................... 17 Appendix 4 – Business Model Components Table ................................................................................ 18 Appendix 5 – Survey Design and Rationale........................................................................................... 19 Appendix 6 – Primary Research Findings .............................................................................................. 22 Appendix 7 – Interview Transcript ........................................................................................................ 26

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1. Introduction
1.1 Schindehutte et al (2009) defines a business model as “a concise representation of how an interrelated set of decision variables in the areas of venture strategies, venture architecture, and venture economics will be addressed in order to create sustainable competitive advantage in defines markets”. In this report, a new innovative business model will be introduced and discussed in regards to an entrepreneurial competencies framework for Starbucks coffee company.

2. Background Analysis
2.1 Starbucks is one of the few coffee shop businesses that, owing to its premium brand status, enjoys a high degree of customer loyalty and has over time gained a significant competitive advantage over lesser known coffee brands1 through their entrepreneurial approach to business centred around innovation and customer intimacy. 2.2 Despite this ongoing success, it is vital for the business to continue to meet customer needs and understand their values through innovative business models and furthermore, to capitalize on existent and potential opportunities. 2.3 After conducting primary and secondary research into the organisation and its consumers, it has been highlighted that although Starbucks enjoys a loyal customer base and has built up a very successful business model, there are still areas in which new opportunities could be pursued (appendix 1). 2.4 After speaking to a store manager it became clear...
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