Question

Evaluate the competitive advantage of Starbucks Corporation on its market. Suggest some recommendations for the managers of Starbucks Corporation to improve competitive advantage.

(250 words)
No Plagiarism (copying) please.

Answer 1

Here are the reasons of competitive advantage of Starbucks -

1. Having a specific target audience

To build a brand or marketing strategy the first step is to know your target audience.

For Starbucks it's very clear that the target audience is either rich class or upper middle class. Nobody is going to pay 500 bucks for a coffee if they don't earn big.

Thus they form their marketing strategies and menu etc keeping this audience in mind.

2. Branding strategy

Starbucks is a global leader in its category. It is at the top of the ladder in each and every country it works in.

The customers know that they always get value for their money. They get the kind of ambience they are looking for.

3. Relationship Building

If you care about your customers, they would care about your product.

Starbucks always follow this strategy. Whether it's about customer reward program or best quality service, it promotes customer retention.

Recommendations for Managers

1. To sustain in the modern unpredictable market keep creating new products. As variety is the key and customers are looking for something new if they are paying so much.

2. In modern world people don't have much leisure time. Hence nobody is going to travel 5 KM for a coffee date or business meeting.

Thus it's important to keep building new branches and franchisee. However, keeping the quality in check.

3. New schemes that can get attention of new customers should be developed. Some specific discount for first time visitors.

Customer retention is good but for expansion you always need good new customer acquisition strategy.