Coffee and Starbucks
Case Study Analysis #1: Starbucks: Delivering Customer Service.
Brief Background:
Starbucks was founded in Seattle, Washington in 1971 as a small coffee shop by three friends, Jerry Baldwin, Zev Siegel, and Gordon Bowker. The idea came from the premise of selling high quality coffee to consumers. However it did not evolve into the present brand until 1982 when Howard Shultz bought the company. Shultz brought about his traveling experiences from Milian, Italy where the coffee culture was an inspiration for the role the espresso bars played in the community. Within a decade, the business rapidly grew to about 140 stores in Chicago and the Northwest. Shultz’s vision was to make a third place as at the time there was only work and home. At this third place, customers could come for high quality coffee, great customer service, and a nice atmosphere. There is a sense of community as even the employees are treated as family they are called “partners” instead of employees. Hourly workers are called “baristas” and some partners have the ability to rise to executive positions. It is also Starbucks value proposition to be customer-oriented is seen in their “Just Say Yes” policy which is to provide the best service possible, even if rules need to be bent. An example, according to this case study, is that if a customer only has a check and checks aren’t normally accepted, the customer will be given a sample drink for free. These were essential factors that accounted for Starbucks success in the early 1990s. As far as branding image, Starbucks main branding strategy is to maintain a coffee culture that centered on a close interpersonal experience. Maintaining a low employee turnover rate and having a range of distribution. The satisfaction of the customer is the central dogma of Starbucks success and its working as in the year 2002 there is a gross profit of $1.9 billion and net income of $215 million (Starbucks: Delivering Customer Service,
Brief Background:
Starbucks was founded in Seattle, Washington in 1971 as a small coffee shop by three friends, Jerry Baldwin, Zev Siegel, and Gordon Bowker. The idea came from the premise of selling high quality coffee to consumers. However it did not evolve into the present brand until 1982 when Howard Shultz bought the company. Shultz brought about his traveling experiences from Milian, Italy where the coffee culture was an inspiration for the role the espresso bars played in the community. Within a decade, the business rapidly grew to about 140 stores in Chicago and the Northwest. Shultz’s vision was to make a third place as at the time there was only work and home. At this third place, customers could come for high quality coffee, great customer service, and a nice atmosphere. There is a sense of community as even the employees are treated as family they are called “partners” instead of employees. Hourly workers are called “baristas” and some partners have the ability to rise to executive positions. It is also Starbucks value proposition to be customer-oriented is seen in their “Just Say Yes” policy which is to provide the best service possible, even if rules need to be bent. An example, according to this case study, is that if a customer only has a check and checks aren’t normally accepted, the customer will be given a sample drink for free. These were essential factors that accounted for Starbucks success in the early 1990s. As far as branding image, Starbucks main branding strategy is to maintain a coffee culture that centered on a close interpersonal experience. Maintaining a low employee turnover rate and having a range of distribution. The satisfaction of the customer is the central dogma of Starbucks success and its working as in the year 2002 there is a gross profit of $1.9 billion and net income of $215 million (Starbucks: Delivering Customer Service,
Cited: Kolter, P. (2012). In K. L. Keller, A Framework for Marketing Management 5th edition (pp. 53-55). New York: Prentice Hall. Melody. (2012, November 18). StarbucksMelody. Retrieved Janurary 20, 2014, from http://www.starbucksmelody.com/2012/11/18/names-on-cups-starbucks/ Starbucks: Delivering Customer Service, 9-504-016 (Harvard Business School July 10, 2006). Zeynep Ton, The Effect of Labor on Profitability: The Role of Quality, Harvard Business School, Boston, MA 02163, zton@hbs.edu.