Starbucks Coffee Case Study
Starbucks: Delivering Customer Service
What factors accounted for Starbucks extraordinary success in the early 1990’s? What was so compelling about Starbucks value proposition? What brand image did Starbucks develop during this period? Starbucks captured a tremendous amount of success in the early 90’s by opening European-style coffee houses targeted toward affluent, well-educated clientele. Howard Schultz, the CEO that bought the company from the original owners, envisioned creating a ‘third place’ for people to meet. Rather than just treating the home and office as the primary places people spend their time, the company introduced Starbucks as a ‘third place’; customers were encouraged to linger and socialize at their locations. The company did not rely on a formal marketing strategy, but rather used the atmosphere of their stores to create a ‘coffee experience’ for customers. The company’s value proposition was used as the focal point of their brand strategy. Their goal was to make coffee consumption a part of everyday life. The proposition had three components: Coffee quality: the company had direct involvement in every aspect of coffee production, from working directly with the farmers growing the beans to the roasting process. This approach emphasized a strong commitment to product quality. Customer intimacy: the company aimed for employees, or “partners”, to provide a high level of personal service. Partners were trained that customer requests are to be encouraged and are to be met with a smile. Partners were encouraged to get to know repeat clients and reach out to new customers to make outstanding service a part of the purchase. Atmosphere: unlike most retail stores selling food and beverages, Starbucks created an atmosphere where customers could linger. They understood that human nature draws people to each other, so the company provided a casual environment for customers to meet up. As a result of their value proposition, Starbucks’ brand image was
What factors accounted for Starbucks extraordinary success in the early 1990’s? What was so compelling about Starbucks value proposition? What brand image did Starbucks develop during this period? Starbucks captured a tremendous amount of success in the early 90’s by opening European-style coffee houses targeted toward affluent, well-educated clientele. Howard Schultz, the CEO that bought the company from the original owners, envisioned creating a ‘third place’ for people to meet. Rather than just treating the home and office as the primary places people spend their time, the company introduced Starbucks as a ‘third place’; customers were encouraged to linger and socialize at their locations. The company did not rely on a formal marketing strategy, but rather used the atmosphere of their stores to create a ‘coffee experience’ for customers. The company’s value proposition was used as the focal point of their brand strategy. Their goal was to make coffee consumption a part of everyday life. The proposition had three components: Coffee quality: the company had direct involvement in every aspect of coffee production, from working directly with the farmers growing the beans to the roasting process. This approach emphasized a strong commitment to product quality. Customer intimacy: the company aimed for employees, or “partners”, to provide a high level of personal service. Partners were trained that customer requests are to be encouraged and are to be met with a smile. Partners were encouraged to get to know repeat clients and reach out to new customers to make outstanding service a part of the purchase. Atmosphere: unlike most retail stores selling food and beverages, Starbucks created an atmosphere where customers could linger. They understood that human nature draws people to each other, so the company provided a casual environment for customers to meet up. As a result of their value proposition, Starbucks’ brand image was