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Transcript of starbucks
“to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time”
Starbucks corporation is a premier roaster, marketer and retailer of specialty coffee.
The visionary statement is "to establish Starbucks as the most recognized and respected brand in the world and become a national company with values and guiding principles that employees could be proud of”.
Product Quality and Variety
Starbucks’ trademark is the unique features of the coffee-based beverages. Customers get to experience luxury coffee drinks at affordable prices, in a very cozy environment. Starbucks created a coffee culture, educating its customers on the coffee types, origins, and the roasting process. This in turn helps them to build brand credibility and equity.
-Non-coffee blended beverages
- offers stock options to part-time employees
- provides at least 24 hours of training for each new employee
- has one of the lowest employee turnover rates in the industry with 60% turnover(140% for the industry average)
store in VN
3. Market and the company
Food and Beverage industry is rapidly becoming more diversified and developing so fast.
People is focusing on the way that we grow food, transport, process, package, purchase and cook.
Starbucks creates a product chain named "handcrafted for you" :
- Products directing from the coffee farms to its customers' hand.
- Focusing in the resources, health of customer
Satisfies all kinds of customer with more and more choices...
Offers a wide range of low calories:
nonfat milk, sugar free syrup or Skinny Peppermint Mocha...
4. Organizational objectives
Objectives that Starbucks is willing to reach by 2015:
-Ensure 100% of coffee is ethically
-Helping small scale farmers thrive now and in the future
-Serve 25% of the beverages made in stores in reusable cups, purchase energy equivalent to 50% of the electricity, reduce water consumption by 25% in company owned stores.
-Use the pays, benefits and opportunities for personal development to help gain employee loyalty and become difficult to imitate.
-Grow by making employees feel valued.
5. Strategic Business Units
1. Americas, inclusive of the US, Canada, and Latin America;
2. Europe, Middle East, and Africa, collectively referred to as the “EMEA” region;
3. China / Asia Pacific (“CAP”).
Our retail objective is to be the leading retailer and brand of coffee in each of our target markets by selling the finest quality coffee and related products, and by providing each customer a unique Starbucks Experience
6. The Boston Consulting Group (BCG)
• The cash cows as the regular Starbucks lines of Coffee’s, Latte’s and Frappuccino found at nearly every location.
• A potential star is the International locations, which hold less financial risk and open doors for innovation and stability.
• Question marks are the recently added VIA instant coffee to be expanding to grocery stores and convenient stores.
• Current products like pre-bottle Frappuccino account for a tiny fraction of sales such as the dog.
7. Main strategies
- focuses on existing products, existing markets
- searches for new potential market( in Asia Pacific, especially China and India)
- follows the new trends of food and beverage industry, updates the consumer taste preference
- launches many new products to existing market
- focuses on new choices for low-calories and diet nutrition foods
- expanded its test of beer, wine, and premium food
- operates its business through three regions to broaden its brands and products all over the world
- increases market share in developing countries and continue the strong development in emerging and developed countries
- improves its knowledge on the consumer behavior by identifying trends such as healthier products
- removes the high fructose corn syrup and artificial trans fats, flavors and dyes
8. Financial statements
Revenues of $13,299 million during FY2012, an increase of 13.66% over FY2011, $11,700.4 million during FY2011, an increase of 9.3% over FY2010.
For FY2011, the US, the company's largest geographic market, accounted for 76.6% of the total revenues.
9. Elements of
Demographic and psychographic
- new target market as “younger, less well-educated, and in a lower income bracket than their more established customers”. They are from middle class to upper class
“People come here for the coffee, but ambience is what makes them want to stay”
- has the striking number of 25 million people visitors in its stores each week
The average price of an order was $3.85. The drinks come in three sizes: tall, grande, and vente. The least expensive price for a tall drink is $1.45 for brewed Coffee of the Day. The most expensive price for a vente is $4.25 for Frappuccino
Distribution for its products
- sells its products through a direct retail system in company-owned stores
- sells its products in supermarkets and shopping centers
- has distribution agreements with office coffee suppliers, hotels, and airlines
- internal advertisements within its retail stores, such as posters, new product signage and other internal means.
- develop its promotion through media, electronic media and social networks(official Facebook of Starbucks has over 33 millions of likes, Twitter with over 3 millions of followers)
- focuses on unique campaigns
10. SWOT analysis
- Starbucks has been aggressively expanding its presence in Asia, particularly in China and India. More than 160 cities in China have population greater than one million
- Total count of stores in China and Asia Pacific reached 2,961 in the first quarter of FY2012. In the meanwhile, growth in same store sales in the region increased by 22% in FY2011 as compared to 2% during FY2009
- Besides China, the company is also focused on the high-potential Indian coffee retail market
- Lower supply of raw materials in the near future and rising prices may increase company’ s costs.
- According to the latest industry estimates, production of the Arabica beans in Brazil, is expected to decline by 7% during 2012. Another market estimate reports that output of the Arabica beans in Brazil will be 39 million bags in 2012–13, down from 42 million bags in 2010–11.
- With increasing raw material prices, the company could go through a cycle of decreased operating margins in the near future.
Starbucks has maintained a competitive advantage to bring quality, bistro-style coffee choices to the masses. In order to stay current it will need to focus on its core competencies and avoid weaknesses. To avoid competitors, it will need to create new value innovation by enhancing the customer experience by investing in online content and interactivity. For growing in the future, it intends to nourish its customers with a range of products, especially healthier and nutritious products. It is committed to protect the environment and making strong value for its shareholders.
Thank you for listening!
1. Bích Hồng
2. Uyên Khanh
3. Khánh Linh
4. Quang Linh
5. Hữu Luân