Ayuban - Strategic Management Plan Project
Ayuban - Strategic Management Plan Project
Ayuban - Strategic Management Plan Project
As Compliance for
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world. Its headquarters are in Seattle, Washington. Starbucks was founded by Jerry
Baldwin, Gordon Bowker, and Zev Siegl, opening its first store in 1971 near the historic
Pike Place Market in Seattle. They were inspired to sell high-quality coffee beans and
equipment by coffee roasting entrepreneur Alfred Peet after he taught them his style
of roasting beans. The company took the name of the chief mate in the book Moby-
Dick: Starbuck, after considering “Cargo House” and “Pequod”. From just a narrow
storefront, Starbucks offered some of the world’s finest fresh-roasted whole bean
coffees with stores in more than 75 markets and the premier roaster and retailer of
Their Mission is to “To inspire and nurture the human spirit-one person, one cup
and one neighborhood at a time” and their Vision is “To establish Starbucks as the
premier purveyor of the finest coffee in the world while maintaining our
superior value to their target customers” (Kotler et al., 2008). The purpose of this
analysis is to sort out the competitors and what makes the Starbucks a number 1
coffee including the strategies that they must consider and improve.
Coffee has resulted in tougher trading conditions, initially hurting the stock price of
Starbucks. Increasing independent coffee chains and choice from consumers will
sales. Consumer may shift to specialty coffee products offered by its competitors. The
patterns may affect the firm’s future operations. Therefore, to align itself with these
“McCafe” coffee drinks, McDonald was known to spend more money on media, such
as television, radio, print, billboards, and interactive web ads. Starbucks had never lost
coffee drinkers to McDonald’s line of McCafe, McDonald’s sells its own version of
Frappuccino, and competes with Starbucks with breakfast oatmeal, fruit salads, and
smoothies.
Starbucks strategic plan creates advertisements with a unique content, the
backgrounds are supposed to resemble a coffee sack, with large and bold headlines
promoting the brands qualities. The ad’s which Starbucks had placed in newspapers
explain how Starbucks chooses only the best 3 percent of beans for their coffee. The
ads also emphasize how they roast the beans until they pop twice to ensure quality
taste. Starbucks had also maintained it’s mobile strategy through a mobile campaign
which allows consumers to chose their ideal summer beverage and Starbucks had run
mobile banners ads through music site. Starbucks had also run a rich media ad
campaign on IPAD sites on VH1 and MTV, campaign is designated to drive interaction
with Apple users. This campaign is known as the “Starbucks, VH1, and MTV Celtra
for tablet-optimized rich media”, they were the first media brands to create touch
optimized browser experience. The objectives of this ad campaign on MTV and Vh1
IPAD sites was to maintain brand awareness and seek out purchase behavior.
Through these, they gain maximum exposure to result in gain in revenue, build
awareness to guarantee subsequent purchase of product and the media plan will
concentrating its outlets at one point. According to the reports that were obtained in
2005, Starbucks had a net profit of $494.5 million, Kellogg $980.4 million, General
There are still other competitors in the market, but Starbucks uses a strategy
of quality and diversification to remove the upcoming competitors. The major products
of this company are breakfast such as coffee and cereals. The company used this
strategy, as a way of placing itself at a more competitive edge that its competitors’
place. The product uniqueness of the two main products is ranged as medium. The
nutritional value of coffee is categorized as low while that of cereal is high. The taste
competitors, as a way of making it hard for other competitors to survive in the market.
The company lowers this price intentionally, as their competing strategy. However, the
price of cereals compensated for coffee, as it is medium price (Grant 102). Starbucks
insist that quality of their products comes first. Through provision of quality products
The company has made extra efforts in ensuring its products reach the intended
customers at the right place and condition. Starbucks have ventured in more than fifty
countries with so many outlets. The company has even introduced online selling of its
products whereby, the customers can purchase the products anywhere, anytime. This
has created much convenience for those customers, who are always busy (Avlonitis
174). They also have a tendency of reaching the customers by concentrating their
Starbucks promote its both nationally and internationally levels. They have used
various media services to reach the customers through placing adverts for their quality
products. Severally, they hold promotion for their products, where people are given
chances to taste their coffee, as an effort of building brand loyalty to the customers.
Conclusion
Effective strategy development is one of the ways through which a firm can
attain coherence between its internal abilities, resources, skills, and the external
compared to other generic coffee commodity. Starbucks has historically been a master
coffee brand in the world. Whilst new challenges, such as McDonalds or indy coffee
are arising and new demands, such as environmental concerns are growing,
greatly emphasizes on good business practices and ethics. In 2011, Starbucks was
ranked as one of the most worlds’ most ethical company (Environmental Leader,
2011). Considering the intense competition in the specialty coffee market, Starbucks
international and domestic markets, it should not take it for granted for good.
and sustain its strengths, offset weaknesses, avoid threats and capitalize on
opportunities. If Starbucks would correctly identify and deal with the issues under
current and near future circumstances, it could remain excited about further growth
Avlonitis, George. Product and services management. New York: SAGE, 2006.
Srinvasan, L. 2005, Strategic management, the Indian context, PHI Learning PVT,
London.