Question

tows matrix for starbucks

Answer 1

In order to develop tows matrix for Starbucks, we have to first identify the strengths, opportunities, weaknesses & threats of Starbucks. SWOT analysis will help us to develop a tows matrix. TOWS matrix is basically strategy formulation tool, so on the basis of identified strengths, opportunities, weaknesses & threats of Starbucks, we can formulate strategy, that will help it to make best use of its strengths, opportunities while overcome its weaknesses & minimize its threats.

Starbucks was founded in 1971. It is an American coffee company. Due to its excellent customer service & its premium quality, it serves as the largest coffee house chain in the world.

SWOT Analysis of Starbucks:

Strengths:

a) Strong brand image.

b) Superior products & services

c) Superior quality

d) Ethical business practices

e) High market share

f) Supply chain management

Weaknesses:

a) Prices of the products offered are high.

b) More focused on US domestic market.

Opportunities:

a) Substantial financial support.

b) Growth & expansion in emerging markets.

c) Increase the number of product offerings.

d) Should make alliances with other brands.

Threats:

a) Competition from other brands.

b) Rivals trying to imitate its premium products.

TOWS Matrix:

SO (Strengths-Opportunities): Utilising its strengths in order to make best possible use of its available opportunities.

a) In order to make its presence in emerging markets, it should use its global brand image.

b) It should increase the number of products offered & simultaneously maintain the superior quality.

c) In order to penetrate the Asian markets at a faster pace, it should enter into partnership with other well established brands.

WO (Weaknesses-Opportunities): Overcome its weaknesses in order to avail the opportunities.

a) It should try to lower the price of its products which will help it to attract middle class customers.

b) Try to increase the sale of its product in Asian markets.

ST (Strengths-Threats): It should use its strengths in order to avoid the threats.

a) In order to reduce the pressure from competitive, it should market its ethical image.

b) Also, by advertising its product, it can well inform the customers about its product quality which will help customers to differentiate between the products offered by starbucks & other rival brands.

c) Investing more in marketing & advertising in order to attract more customers & reduce stiff competition from other brands.

WT (Weaknesses-Threats): Overcoming its weaknesses in order to avoid threats.

a) In order to avoid the problem of imitation by other rival brands, it should advertise the premium quality of its products.

b) In order to avoid competition from rival brands that sell products at lower price, it should also develop a range of products with lower price.