Marketing Strategies Used To Develop Customers' Interest in Starbucks

Introduction

Starbucks Coffee is a chain of coffee speciality stores that began in 1971 as one small shop in Seattle's Pike Place Market. In the past nine years, it has gone through rapid growth, expanding from 11 stores in 1987 to a total of 500 today. Mr Howard Schultz had been a buyer for Starbucks Coffee since the early 1980s. On a coffee-buying trip to Milan, Italy, he noticed that crowds of people gathered each day in coffee bars to drink their speciality coffees. Schultz wondered if the same thing could happen elsewhere. Back in Seattle, he attempted to persuade his bosses to try the coffee bar idea and go beyond just selling coffee beans to restaurants. They refused. Schultz raised $1.7 million dollars and opened his own cafe in downtown Seattle. The first coffee he served was Starbucks. In less than a year, he had opened two more stores. Subsequently, he bought out Starbucks from his former employers for $4 million.

Speciality coffees have slowly taken business away from the traditional canned coffees. The high-quality coffee bean industry created $717 million in sales in 1990, with a 13.5 percent share of the coffee market. By 1991, the penetration was even deeper. Gourmet sales had reached $800 million and their market share rose to 17.7 percent. In the meantime, coffee shops grew at a rapid rate. By 1992, Seattle had 150 coffee bars. Starbuck's mission statement reads, “To establish Starbucks as the premier purveyor of the finest coffee in the world while maintaining our uncompromising principles as we grow.” Some of the principles of the company are treating everyone with respect and dignity, buying the best available coffees, developing loyal customers, contributing to the environment, and making a profit.

While this hardly makes the company unique, what does make the company special is that it seems to understand the connection between delivering a great cup of coffee and treating their employees with respect. One training manager suggests that the quality of everything comes down to the employee experience. The Starbuck's culture is built on very strict standards for how coffee should be prepared and delivered (Serwer, 58), combined with an empowering attitude toward the employees who deliver the coffee to the customers. In some of the Starbucks stores in larger markets, the company also offers French Press coffee, besides its espressos. The press pot, or French Press, is a glass brewing decanter with a movable metal plunger in the lid. Ground beans go into the pot. Then boiling water is poured into it. After the coffee sits for a minute, the plunger is pressed down so the grounds go to the bottom of the pot. Pressed coffee has more oils and compounds, but also more flavors. The majority of Starbucks shops use it primarily for sampling new coffees.

Starbucks is opening 150 stores a year in new markets across the United States. Almost two million Americans visit Starbucks coffee shops each week. During 1995, it planned to ...