STARBUCKS MARKET ANALYSIS

Starbucks Market Analysis

Starbucks Market Analysis

Background of the Company

This paper discusses the current market situation and market analysis for one of the leading coffee manufacturers of the world, Starbucks. From Starbucks' founding in Seattle as a local coffee bean roaster and retailer, the company has expanded rapidly (www.starbucks.com). In the 1990s, Starbucks was opening a new store every workday, a pace that continued into the 2000s. The first store outside the United States or Canada opened in the mid-'90s, and overseas stores now constitute almost one third of Starbucks' stores. The company plans to open a net of 900 new stores outside of the United States in 2009, but has announced 900 store closures in the United States since 2008 (www.starbucks.com).

Starbucks is the largest coffeehouse company in the world, with 16,120 stores in 49 countries, including around 11,000 in the United States, followed by nearly 1,000 in Canada and more than 800 in Japan. Starbucks sells drip brewed coffee, espresso-based hot drinks, other hot and cold drinks, snacks, and items such as mugs and coffee beans (www.starbucks.com). Through the Starbucks Entertainment division and Hear Music brand, the company also markets books, music, and film. Many of the company's products are seasonal or specific to the locality of the store. Starbucks-brand ice cream and coffee are also sold at grocery stores.

Starbucks' Mission Statement

Starbucks' prime mission is to inspire and nurture the human spirit— one person, one cup, and one neighborhood at a time (starbucks.co.uk).

Objectives

Create a solid concept in the industry and track performance in order to begin expanding to other markets within six months.

Be an active and vocal member of the community, and provide continual re-investment through participation in community activities such as the Chamber of Commerce and financial contributions to local charities and youth organisations (starbucks.co.uk).

Keys to Success

A superior-tasting product backed by a unique quality store

A market that exposes Starbucks to high-profile "trend-setters" and "key influencers"

Ongoing, aggressive marketing

Highly trained and friendly staff

Multiple revenue streams including gift items, gift baskets and coffee gift/frequency cards in addition to coffee, pastry, chocolates, tea, juice, water and soft drinks ((Mintz, 2006))

Products

Starbucks sells high-quality specialty coffee beverages, tea, juice, water, soft drinks, pastries, chocolates and gift items. Despite being an upscale coffeehouse, our prices are in line with the leading national chains (starbucks.co.uk).

Coffee and Espresso Drinks

ESPRESSO COFFEE

Name

Description

Regular

Large

Espresso

A double shot of straight espresso.

$1.75 Double

Caffe Americano

Espresso combined with hot water, a gourmet brewed coffee.

$1.85

$2.25

Cappuccino

Espresso with a smooth topping of milk foam.

$2.50

$3.50

Caffe Latte 

Espresso combined with steamed milk, topped with a small amount of velvety milk foam.

$2.75

$3.25

Caffe Mocha 

A Caffe Latte combined with Ghirardelli chocolate, topped with whipped cream and chocolate shavings.

$3.00

$3.75

Espresso Macchiato

A straight shot of espresso topped with a spoonful of rich milk foam.

$1.75

$2.50

Espresso Con Panna

A straight shot of espresso topped with a generous dollop of whipped cream.

$1.75

$2.50

Espresso Latte Breve

Our famous latte made even more creamy with half and half.

$2.50

$3.50

Espresso "Red Eye"

Espresso combined with our gourmet coffee of the day to get your day going.

$2.00

$2.75

COFFEE DRINKS

Name

Description

Small

Large

The Banana Nut Java

Coffee. Warm ...