What factors accounted for the extraordinary success of Starbucks in the early 1990s? What was so compelling about the Starbucks value proposition? What brand image did Starbucks develop during this period? Describe the original target market.
The factors that contributed to Starbucks` success were their experiential branding strategy, their reach, product variety, customer service and quality. The compelling factor of the value proposition was that Starbucks was tightly integrated. It met the needs of its target market. In the early 1990s, Starbucks` target market consisted mainly of coffee connoisseurs. Starbucks was less about the coffee itself and more about the experience around the consumption of coffee. The brand image it developed during this period was synonymous with its ‘live coffee’ mantra. It became America’s third place – after home and work. They created a place other than work and home where people could meet and hang out. They brought the Italian coffee shop culture to America. They had three branding components – the coffee itself, customer intimacy and the ambience. To enforce their coffee standards, Starbucks directly dealt with growers in different countries to purchase green coffee beans, oversaw the custom-roasting process and also controlled distribution to retail stores around the world. They created an uplifting experience for the customers by their `customer intimacy` strategy. The ambience they provided was based on the human spirit, sense of community and the need for people to come together. Their brand image back then was that of a living room outside your home with good quality coffee. In a decade, this changed drastically to being anywhere, everywhere, good coffee on the run. Their brand image was essentially consistent with high quality, personalized service rather than that of making a huge profit. This had also changed over the decade when a survey showed that 61% of the customers thought Starbucks cared...
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