Introduction and Product for Starbucks Coffe free essay sample

Starbucks company only purchases and roasts high-quality whole bean coffees and sells them, along with fresh, rich-brewed coffees, Italian-style espresso beverages, cold blended beverages, a range of complementary food items, different varieties of premium teas and coffee-related accessories and equipment, primarily through company-operated retail stores. Starbucks also sells coffee and tea products and licenses its trademark through other channels such as licensed retail stores and, through certain of its equity investees and licensees, Starbucks produces and sells a range of ready-to-drink beverages. All channels outside the Company-operated retail stores are collectively known as specialty operations. Several online activism groups maintain websites criticizing the companys fair-trade policies, labor relations, and environmental impact, and holding it as a prime example of what they see as U. S. cultural and economic imperialism. On February 2006, Starbucks had 6,216 company-operated outlets worldwide: 5,028 of them in the United States and 1,188 in other countries and U. S. territories. Numbers of Starbucks coffee’s Outlets (worldwide) There are more than 5,500 coffeehouses in over 50countries in the world and three new Starbucks coffee shops are opened up daily. The first international coffeehouse was in Tokyo in 1996. Due to the extraordinary response in Tokyo Starbucks coffee has decided to expend their business to more counties and this is what that makes today’s Starbuck coffee. Starbucks coffee’s Mission statement Establish Starbucks the premier purveyor of the finest coffee in the world and maintaining our uncompromising principles as we grow. The following six guiding principles will help us measure the appropriateness of our decisions: 1. Provide a great work environment and treat each other with respect and dignity. 2. Embrace diversity as an essential component in the way we do business. 3. Apply the highest standards of excellence to the purchasing, roasting and fresh delivery of our coffee. 4. Develop enthusiastically satisfied customers all the time. 5. Contribute positively to our communities and our environment. 6. Recognize that profitability is essential to our future success. Starbucks coffee’s Objective Starbucks coffee’s objective is to establish its company as one of the most recognized and respected brands in the world. To achieve this goal, the Company plans to continue disciplined expansion of its retail operations, to grow its specialty operations and to selectively pursue other opportunities by coming out with new products and developing new channels of distribution. General information about Singapore’s Starbucks Singapore being the third international country outside North America to introduce Starbucks is a wholly owned subsidiary of Starbucks Coffee Corporation since June 2004. The first Starbucks store was open on 14 December 1996 at Liat Towers, strategically located along the nations renowned Orchard Road shopping belt. Starbucks coffee houses offer more than the finest coffee sourced from across the globe. Friendly people, great music and a comfortable meeting place create the famous Starbucks Experience. The layout and atmosphere of Starbucks stores is specifically designed to be cosy and intimate, while at the same time providing people with their own personal space to use as they wish. The combination of sofas, armchairs, coffee tables and chairs, bars and stools, and meeting room tables means that there is something for everyone. Those looking for peace and quiet away from home or the office can relax and linger in a comfortable armchair and escape into a book, whilst those looking for an intimate place to meet friends can huddle on a sofa and chat over a mug of coffee, as they would in their own home. Nature of the product Coffee beans begin at the farm on coffee trees. After trees are planted, it takes between one and three years for the trees to bear coffee â€Å"cherries,† which typically contain two beans. Each tree produces 2,000 to 4,000 beans a year—approximately one pound of roasted coffee. However, yields alternate with a good crop one year and a poor crop the next. Farm sizes range from 5 acres (traditional farms) to large plantations covering thousands of acres. Farming and harvesting methods differ greatly between traditional and large coffee farms. Between50% to 70% of the global coffee supply came from small-scale farms from 2001. Coffee must be processed, and it was common for small farmers to accept a considerably lower price to be able to get their coffee to market. Often, these small producers had difficulties financing their operations throughout the year and would sell their crop to Starbuck prior to harvest to receive a cash advance. Methods of investigation We used secondary data to research information on Starbucks coffee, mainly from the internet. Not only that, we also went to different Starbucks coffee’s outlets in Singapore to observe the stores as well as the customers who came in. At the same time, we use the Starbucks’s application software for smart phones to check on its current promotions and other useful information. Product Starbucks tried to position themselves as a premium product in the coffee industry by creating a high quality, introducing innovative, creative products and providing excellent service. Starbuck knew how perishable coffee was and they highly regarded their quality control, and hence  they carefully monitored  each and  every step of  coffee production. They bought dark-roast, whole bean coffee from places like Sumatra, Kenya, Ethiopia and Costa Rica; roasted them in their own plants; and sold only through company-owned stores moreover they uses non-fat milk and their the introduction of Frappuccino made a significant presence in the earnings and reputation. Gradually food items such as cookies, pastries, sandwiches and salads made their way into the stores. Later  they went on  to develop new  products with other  companies. Product Classification Core Product Benefits Core product benefits referred to as benefits that customers are buying when they obtain a product. In the case of Starbucks coffee, the core product benefit would be providing customers with premium, high quality coffees and tea together with a comfortable place to relax. Actual Product Benefits Actual product is a product’s parts which combine to deliver the core product benefits. This includes the brand name, design of apparel and packaging. Starbucks coffee will be the brand name which provides the best coffees and teas together with a comfortable place for relaxation; this will be their design section of the apparel. For packaging, bags or the containers with the brand name imprinted on will be given to their customers at the point of purchase. Augmented Product Benefits Augmented product benefits are the additional customer services and benefits that are built around the core and actual products and support these offerings. Starbucks coffee’s offers augmented product benefits through price guarantee, as they uses the best coffee beans in the world, they were so fanatical about quality control, and hence  they carefully monitored  each and  every step of  coffee production, they also builds customer relationships, provides discounts and promotions to their customers. Product Category Starbucks’ products are classified as shopping goods, the prices of goods sold are fairly inexpensive and they have a large number of outlets. Customers in this market are brand loyal to a certain extent; they prefer specific brands but do accept substitutes. Purchases are infrequent for these goods and require more shopping time for comparison. A cup of coffee is a range from $4-$8 depending on the sizes, outlets can be found in almost every estate in Singapore hence customer are quite loyal but may accept substitutes from competitor such as Coffee Bean and TCC. Product Mix Width The product mix width refers to the number of product lines an organization offers. Starbucks coffee offers a wide range of products, with lines in the beverage, savory, dessert and merchandise. Unique Selling points Focuses a lot on keeping stores green and recycling as compared to its competitors like Coffee bean and TCC Starbuck coffee promotes a lot on recusing of materials such as woods. Examples are those tables, walls and bar incorporates which are made from railroad sleepers from Southeast Asia. Starbucks coffee’s stores are the first green cafe in Singapore to be illuminated by 100% LED lighting to promote energy saving. The energy saved per year by using these lamps can light a 5-bedroom HDB flat for 35months. They also recycle cardboard boxes, milk jugs, syrup bottles, and coffee grounds used in their stores. Starbucks coffee gives 10cents discount to customers who use their personal cups/tumblers so as to cut down the use of paper cups. Over the years Starbucks has launched many initiatives to reduce the environmental impact of their disposable cups. Examples will be developing their recycled-content cup sleeve to avoid the waste of double cupping, launching the industry’s first hot beverage paper cup with 10% post-consumer recycled fiber, they rolled out a new plastic cup that has less of an environmental impact than their original plastic cups. Hosting many Cup Summit to come out with innovative ways to make cups and food packaging more recyclable. They also run many programs to emphasize on the important of keeping green and recycling one example will be the follow â€Å"Participle does Global Green Day da Starbucks† This is the link to the video http://www. youtube. com/watch? v=E8Jvk0eXEF0 Here is a link that served as evidences for Starbuck Coffee recycling cups: http://www. starbucks. com/responsibility/global-report/environmental-stewardship/cup-recycling Customizing your own drinks Starbuck Coffee is the only cafe in Singapore that provide such service. Anybody can create their own personalized Starbucks drink with over 87000 combinations at any Starbuck stores. This is one very special service that other competitors like Coffee Bean and TCC do not have. APP for Starbucks This is an application by Starbucks coffee to provide more service to their customers. Now Starbuck customers can send their love ones a Starbucks Card eGift, manage/reload Starbucks Card, track rewards, view transaction history, customize/share their favorite drinks, stay updated with their latest promotions and find a Starbucks store near them just by a few clicks on their phone. Product Life Cycle (PLC) Product life cycle is a concept that provides a way to trace the stages of a product’s acceptance, from its introduction to its decline. It consists of 4 stages: Introduction Stage Growth Stage Maturity Stage Decline Stage Here in this case, Starbucks coffee is in the 3rd stage of the product life cycle – The Maturity Stage. The maturity stage refers to the period during which sales slowdown. New users cannot be added indefinitely and sooner or later the market approaches saturation. Normally, this is the longest stage of the product life cycle. The emergence of niche marketers, which target narrow, well-defined and underserved segments of a market, will also surface at this stage. Although Starbuck is a matured brand, however it is still growing and expanding its market shares. Marketing Mix Strategy| Maturity Stage| Product Strategy| Product lines are lengthened to appeal to additional market segments. Starbucks coffee will try to distinguish their products or services from their competitors, and these product changes will tend to be more towards coming out new beverages, hand-made deserts or programs that ttracts customers. | Distribution Strategy| Putting a lot of effort to retain the shelf spaces and distributors. Competitors will start felling out of the market due to the falling of prices and profit. | Promotion Strategy| It will stimulate selective demand; advertise brand aggressively; promote heavily to keep customers. Promotion often very intense to keep the loyalty of the customers. Heavy consumer promotion is als o required to maintain market share. Charity events building brand image, loyalty programs to retain customer’s loyalty towards its brand and more programs in building customer relation to boost market share and brand awareness. The price of Starbucks is similar to its competitors but the quality is guaranteed. | Pricing Strategy| There will not be any major adjustment to their price. Product affordable, similar price to other competitors. | While the Maturity Stage of a product’s life cycle can go on for years, eventually sales and market share will begin to decline and this will signal the entry to the decline stage of the product life cycle.