Starbucks - Case Study

Howard Shultz was in the coffee bean business and he had an idea. His company received beans from various farmers and would then process the beans for consumption. Receiving the beans from the growers was a difficult process, as the beans changed hands many times before arriving at the processing plant and many uncontrollable external factors came into play for success. For a successful harvest, the coffee trees depended on perfect weather conditions, the overall health of the tree, harvesting practices, and the many social, political, regulatory, and economic environments in the hosting country that the harvests were collected from. Any one of the previous factors could devastate the harvest for that year and greatly increase coffee prices. This was quite concerning to people in the coffee business but, Schultz had an idea to make coffee a way of life for everyday consumers. Schultz wanted to create a business that gave people an opportunity interact with other people and enjoy a good cup of specialty coffee made the way they wanted. However, his current employer was not supportive, so Shultz left and created his own business.

Schultz had learned about the current trends towards specialty coffee wanted by consumers. People were looking for a drink that replaced alcohol and a friendly place to meet and interact with family, friends, and peers. He also knew people perceived coffee as an affordable luxury and was becoming more knowledgeable about the coffee beans he worked with his entire life.

Shultz created his own coffee house that provided his customers with a new opportunity for drinking coffee. He focused on the above objectives and became successful enough to buy out the current Starbucks Coffee producer. Schultz followed his dream and dedication to make his business one of the most recognized brands in the world.

Starbucks is currently pursuing some very good marketing ideas. With PepsiCo, Inc., Starbucks is marketing a ready-to-drink iced Frappuccino. Starbucks and PepsiCo have come together to help each other market their products and create brand equity. Other companies that have partnered with Starbucks include "United Airlines, Nordstrom, Barnes and Noble" (Kachra, 1997). Starbucks has also created an online café store, new methods and equipment for roasting coffee, and mail orders for rural customers.

By pursuing these marketing opportunities, Starbucks is creating a way for customers to recognize the brand through other manufacturers and online. When consumers are loyal to a company that supports Starbucks, they are more likely to try a product.

The first role of the consumer is to buy Starbucks coffee. The second role of the consumer is to see Starbucks as a meeting place where you can sit back and be yourself, conduct a meeting, or gain advice on brewing the coffee at home from one of the baristas. Consumers enjoy when they can come back to the same store to get that cup of coffee they regularly enjoy.

The obligation of Starbucks to the consumer is to always provide a consistent product in line with consumer demands of price, quality, and convenience. Starbucks employees, called baristas, are extensively trained in all areas of coffee making answer customer questions and Starbucks merchandise is of the highest quality.

Starbucks is a very large corporation and demands the best from their suppliers. If there is going to be a problem with a material shipment in January, Starbucks requires their distribution centers to call them in September and let them know of the situation. They also want their distribution to have Plans B and C available to make sure the corporation can succeed through the upcoming months. Starbucks does reserves the right to reject any material that does not meet their quality standards throughout the bean refining process.

Starbuck's supply chain claims to have the best transportation options in the industry and they are not afraid to challenge their suppliers to come up with new innovative ideas. If Starbucks were to receive inadequate