Starbucks Case Study Analysis
What factors accounted for the extra-ordinary success of Starbucks in the early 1990s?
1. by 1992 Starbucks had 140 stores and was competing against small scale coffee
2. Starbucks went public in 1992 which helped them raise 25 million, allowing expansions to continue.
3. Almost no spending in marketing
4. Controlled supply chain – enforcing standard quality
5. Focused on service and the partners
6. Created ambiences with universal appeal
7. Company operated stores, not franchises which usually lack on quality standards
8. Location location and location!
9. Branched and started serving other products ( sodas, pastries, juices etc…)
10. Distributed through other channels – food service, domestic retail, partnerships, online and mail.
11. Taking care of the partners ( health insurance and stock options, promoting from within)
Many factors accounted for the extra-ordinary success of Starbucks in the early 1990’s. Starbucks owns nearly one-third of America’s coffee bars, which is more than its next five biggest competitors combined. Almost all of Starbucks’ locations in North America are company-owned stores located in high-traffic, high-visibility settings such as retail centers, office buildings, and university campuses. This made Starbucks a very convenient coffee bar because of the many different locations. Starbucks also worked to add more depth to their product in the coffee shops. In addition to selling whole-bean coffees, these stores sold rich-brewed coffees, Italian-style espresso drinks, cold-blended beverages, and premium teas. Product mixes vary depending on the stores size and location; however, most stores offer a variety of pastries, sodas, juices, coffee-related accessories and equipment, CDs, games, and seasonal novelty items.
Starbucks also sold products through non-company-operated retail stores such as hotels, airlines, and restaurants. Additionally Starbucks formed joint ventures to distribute a bottled frappuccino thru Pepsi-Cola
1. by 1992 Starbucks had 140 stores and was competing against small scale coffee
2. Starbucks went public in 1992 which helped them raise 25 million, allowing expansions to continue.
3. Almost no spending in marketing
4. Controlled supply chain – enforcing standard quality
5. Focused on service and the partners
6. Created ambiences with universal appeal
7. Company operated stores, not franchises which usually lack on quality standards
8. Location location and location!
9. Branched and started serving other products ( sodas, pastries, juices etc…)
10. Distributed through other channels – food service, domestic retail, partnerships, online and mail.
11. Taking care of the partners ( health insurance and stock options, promoting from within)
Many factors accounted for the extra-ordinary success of Starbucks in the early 1990’s. Starbucks owns nearly one-third of America’s coffee bars, which is more than its next five biggest competitors combined. Almost all of Starbucks’ locations in North America are company-owned stores located in high-traffic, high-visibility settings such as retail centers, office buildings, and university campuses. This made Starbucks a very convenient coffee bar because of the many different locations. Starbucks also worked to add more depth to their product in the coffee shops. In addition to selling whole-bean coffees, these stores sold rich-brewed coffees, Italian-style espresso drinks, cold-blended beverages, and premium teas. Product mixes vary depending on the stores size and location; however, most stores offer a variety of pastries, sodas, juices, coffee-related accessories and equipment, CDs, games, and seasonal novelty items.
Starbucks also sold products through non-company-operated retail stores such as hotels, airlines, and restaurants. Additionally Starbucks formed joint ventures to distribute a bottled frappuccino thru Pepsi-Cola