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June 1, 2023
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Founders: Jerry Baldwin/ Gordon Bowker. Open the first Starbucks in Seattle 1971.
Goals: wanted people to have access to the best, educating its customers about the coffee
Values: offer the warmth of a European coffee (want to implement in USA what he has experienced in Italy) – turn coffee from a commodity into an experience: Unique and personal
Vision: “To become an enduring, great company with one of the most recognized and respected brands in the world, known for providing the best quality coffee“
Schultz wanted to bring the romance of Italian coffee to America – He opened his own coffee bar Il Giornale and joined Dave Olsen who had a successful coffee bar in Seattle, Café Allegro.
Their strategy: customer loyalty and saturating the market
Their mission: Establish Starbuck as the first purveyor of the finest coffee in the world while maintaining the aim of Starbucks “the warmest place to appreciate coffee”
Creating the Starbucks experience (thanks to the store design, focus on the customer, creating partnerships & alliances with social organizations), the passion and leadership of Howard Schultz brought success to the company.
An internal company culture centered around the employees’ empowerment, meant that employees could participate in the development and decisions of the company. Schultz really works with his whole staff. He builds respect & confidence with his employees.
Schultz explains the strategy of the firm to employees so they are involved and motivated at work.
The planned number of store openings has been exceeded (165 instead of 125 in 5 years) (they focus on the US market)
1992 – company went public = to raise capital in order to accelerate growth.
Schultz became the new CEO of the company & focus on hiring only managers who have experience in growing businesses.
To increase sales, they started selling both food and drinks (Launched the Frappucino = hit of Starbucks)
They formed partnerships with different companies to be present in many sectors (grocery stores, ice cream industry, music industry and tea industry)
The principle of contributing to communities & the environment is very important for Starbucks.
They work together with partners & suppliers to define sustainable methods for coffee production.
Made a partnership with The Center of Environmental Leadership in Business in order to:
Even if difficult economic times in 2007, Starbucks is still increasing its profits over years.
But finally, Starbucks adapts itself to all these situations and is keeping its competitive advantage (customer oriented service). They succeed in making good decisions and understand that their unique concept was their strength – Starbucks planned to expand to the number of stores internationally and limit the ones in US because of a saturation of the market.
Starbucks hasn’t lost its competitive advantage because the brand belonging is still very strong and the company is really customer-oriented since the beginning. Starbucks stores have a real identity and design which is also an added value for the brand and permits them to make their competitive advantage sustainable.
To redirect the company on a good path, come back to the main goal: offer to the customer the unique café experience that drove Starbucks past success. They want to go back to the previous vision: passion for the business, for the customer & employees.
For that, transformation agenda:
Want to focus on expanding on international markets:
– Taking advantage of the actual and volatile popularity of the brand to attract new customers (also in Africa, Asia, South America).
Starbucks Coffee announced the introducing of coffee delivery in 2015. The actual CEO Howard Schultz said that the coffee giant is “finalizing plans for two distinct delivery models, one of which utilizes our own people and the other of which leverages the capabilities of a third-party service”. The delivery system is expected to increase sales and generate more customer loyalty. Moreover customer will be able to use their mobile phones to order and pay in Starbucks ‘stores nationwide by the end of the year. Customers could plan their order and go to the store they select to pay and pick up their order.
Customers are already able to pay using the Starbucks app, but the ordering feature will be a new addition.
The Seattle coffee company also plans to introduce new “express” locations in New York City as part of a pilot project. The locations will offer a streamlined assortment of food and beverage options and integrate Starbucks’ mobile payment, mobile order and pay options.
