A comparative analysis against competitors and customers’ expectations| |
When you think of Seattle what images come to mind? A pristine mountain backdrop covered in hunter green conifers? A city landscape covered by rain clouds on the edge of the Pacific Ocean? Or an urban city saturated with over 500 Starbucks coffee shops? Starbucks, originally founded in Seattle in 1971, has become the world’s largest coffeehouse company in the world and is now synonymous with Seattle, Washington. They have built their business on the strengths of customer loyalty, market saturation and satisfying customer’s expectations but now their weakness of high price points is being strategically attacked by outside competitors.
Starbucks has built customer loyalty over the ages through service, attention to detail and innovation. Originally, Starbucks began as a small whole-bean roaster who served the customer by selling coffee for the home. Howard Schultz, then Director of Retail Operations and Marketing, saw the potential to take it from a company dabbling in the retail sector to its current state. Schultz bought out Starbucks and quickly began to expand its retail business but always kept sight of the customer. Schultz built the brand off of service and truly believed that “we aren’t in the coffee business, serving people. We are in the people business, serving coffee.” (Ruzich, 2008, p. 5). Starbucks has focused on servicing the customer with new and exciting premium coffees over the years. In fact, Schultz introduced the idea of the espresso to Starbuck’s line in the 1980’s after a trip to Milan, Italy. The introduction of the espresso to the United States retail market provided a service that other coffeehouses had not even begun to think of. He began to see the vision that Starbucks truly would serve people through coffee. “We realized that our stores had a deeper resonance and were offering...