N'Rica Altair M. Lagarde
Mae Ann A. Mejica
Shiela May Y. Quilantang
Starbucks: Delivering Customer Service
I. Summary of the Case
The Starbucks was started with the three coffee fanatics with Gerald Balwin, Gordon Bowker and Ziev Siegl in 1971. They open a small coffee shop in Seattle’s Pike Place Market. The shop was specialized in selling whole Arabica beans to a niche market of coffee purist. Howard Schultz joined the company in 1982, and, after a trip to Milan, advised that the company sell coffee and espresso drinks as well as beans.
A few years later, the three founders decided to sell the company to Schultz. This event led to his opportunity to experiment on Starbucks. As soon as his took over, he began opening new outlets around the country.
Starbucks is a dominant brand name in North America as the provider of gourmet coffee beans, coffee-based drinks, and non-caffeinated beverages. It is also becoming a well known brand in many countries around the globe. Starbucks' value proposition is to create an "experience" around the consumption of coffee that its consumers could weave into the fabric of their everyday lives.
The company currently serves over 20 million customers in over 5000 company-operated and licensed stores throughout the world. Another interesting fact is that Starbucks has achieved this level of success without much advertising.
Recent market research has shown that Starbucks is not meeting its customers' expectations in terms of customer satisfaction.
Today Starbucks Corporation is the leading roaster, retailer, and marketer of specialty coffee in the world, without spending almost nothing on advertising.
II. Statement of the Problem
Should the company invest $40 million to add an equivalent of 20 labor-hours per week to its stores worldwide?
* To be able to identify whether the company needs to invest millions to increase...