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Starbucks Case Study
Transcript of Starbucks Case Study
1.Using the full spectrum of segmentation variables, describe how Starbucks initially segmented and targeted the coffee market.?
2. What changed first—the Starbucks customer or the Starbucks Experience? Explain your response by discussing the principles of market targeting.?
3. Based on the segmentation variables, how is Starbucks now segmenting and targeting the coffee market?
4. Will Starbucks ever return to the revenue and profit growth that it once enjoyed? Why or why not?
- Starbucks had made a goal and their initially segment was a Demographic segmentation
-Starbuck or Schultz intentions to open 10,000 new stores in just four years and then push Starbucks to 40,000 stores.
-In 20 years time, Schultz grew the company to almost 17,000 stores in dozens of countries.
Starbucks targeted the customer who fell in love with the Starbucks Experience who was:
-Wealthier, better educated, and more professional than the average American.
- More likely to be female than male.
- Between the ages of 24 and 44.
Starbucks customer changed first.
There simply were not enough traditional customers around to fuel the kind of growth that Schultz sought.
Starbucks became a less attractive place to hang out.
The new breed of customer was less affluent, less educated, and less professional.
As the customer profile evolved, the Starbucks Experience grew to mean something different. To the new breed of customer, it meant good coffee on the run. It was a place to meet and then move on.
This new customer came in much less frequently than the traditional customer, as seldom as once a month.
3- geography (city, neighborhood, zip code…), and other personal attribute.
Starbucks segmenting now would be typically built around :
1- demographics (age, income, gender…),
2- psychographics (lifestyle, personality, values…),
our guess is yes.
they have a new good segmentation and targeting strategy.
Targeting new segments that they didn’t target before.
Trying to regain the traditional Starbucks customer via trying to restore the Starbucks Experience.
Only one fifth of Starbucks’ sales come from outside the United States which means huge potential growth outside the US.