Question

Why Starbucks launched its first overseas “Reserve Roastery," a flagship store combining gourmet coffees and a bakery in Shanghai? (Please explain it by all learning from the class of strategic management).

And here below is what I learn so far. so use them

marketing planning

.looking for marketing direction-SWOT Analysis

.Looking for customer-S.T.P Analysis

.Looking for method -p marketing mix

Maslow's hierarchy of needs (three waves of coffee industry)

positing map

efficiency frontier curve

Answer 1

Starbucks is known for its Premium product. They have always shown a keen interest towards the innovation. And they came up with this idea of coffee s experience. And this time it was the startbucks "Reserve Roastery" which came up with this new concept of multi sensory retail experience.

Coming to the SWOT.

Strengths (S)

• Starbucks has a strong financial performance
• It occupies the no one spot among coffee & beverage retailers in the world
• It is top of the mind recall among consumers and by virtue of its brand, which reflects excellence & quality.
• Known for its pioneering people management in an industry where people skills & soft skills make the difference between success and failure..

Weaknesses (W)

• The company dependents heavily on its main and key input, which is the coffee beans hence, is acutely dependent on the price of coffee beans as a determinant of its profitability.

Opportunities (O)

• The company can expand its supplier network & the range of suppliers from whom it sources in order to diversify its sources of inputs and not be at the mercy of whimsical suppliers.
• The company has a huge opportunity waiting for it as far as its expansion into the emerging markets is concerned.
• Starbucks can expand its product offerings to take on the full spectrum food and beverage retailers like McDonald’s and Burger King.

Threats (T)

• Many players are coming into this segment at an affordable price and offering full spectrum of food and beverages.

So opportunity is something on which companies try to go on so that they can tap the untapped part. Over here we saw that Starbucks has opportunities like expanding the range of products and go into the market which is not served by them.

By opening the “Reserve Roastery” they have tried to offer the unique service which no other competitor is doing. They are trying to expand the range. And by opening in Shanghai they are trying to tap the emerging economy.

Coming to STP, Starbucks is playing very smartly by segmenting itself in Asian market and targeting the emerging economy. They are positioning them self as the most premium band. And by opening the “Reserve Roastery” they are taking this premium experience to another high level.

If we see the marketing Mix (4P’s ) then place is Shanghai, price is premium, product is the unique experience of Roastery, promotion is widespread.

On the positioning map it can be positioned as follows: Xaxis is price, and y axis is quality. And starbucks comes to the quadrant that specifies HIGH,HIGH.