Starbucks Service Delivery
STARBUCKS: DELIVERING CUSTOMER SERVICE
In 1992 Starbucks vision was to become the “Third Place” (home, work and then Starbucks). The value proposition was based on high quality coffee, high service standards and customer intimacy all offered in a relaxed and comfortable atmosphere. The positioning was meant to appeal to a niche market of highly educated affluent customers predominantly female between the ages of 24-44 years.
Starbucks did not have a dedicated marketing strategy, but the function was performed by three separate groups with little coordination. In the words of Chistine Day everybody had to perform marketing as part of their job. This meant that they weren’t strategic in their approach and while they were hugely successful over the next decade, by 2002 there were some widening gaps between Starbucks vision and their market survey results. Christine Day realized they had failed in terms of “customer intimacy”; their customer base had changed, yet they hadn’t realized this. Additionally their service level had fallen, with a concurrent increase in the technical and rigorous demands of the barista’s job. The entry strategy into China similarly positioned Starbucks as an elite and ubiquitous brand. In the east and particularly in China, status is an integral part of the culture. Starbucks positioning would therefore appeal to the burgeoning masses of young well educated and affluent class of Chinese society. This market segment had growing purchasing power and an incessant appetite for western brands and status symbols of prosperity and a glorious western lifestyle. They engaged in global market adaptation by customizing their product offerings to cater to local preferences. Additionally they had to demonstrate a greater commitment to Corporate Social Responsibility (CSR), in order to build trust in the new Chinese community, and the menu as well as Starbucks initiatives looked like a blend of east meets west, with use of local teas in partnership
In 1992 Starbucks vision was to become the “Third Place” (home, work and then Starbucks). The value proposition was based on high quality coffee, high service standards and customer intimacy all offered in a relaxed and comfortable atmosphere. The positioning was meant to appeal to a niche market of highly educated affluent customers predominantly female between the ages of 24-44 years.
Starbucks did not have a dedicated marketing strategy, but the function was performed by three separate groups with little coordination. In the words of Chistine Day everybody had to perform marketing as part of their job. This meant that they weren’t strategic in their approach and while they were hugely successful over the next decade, by 2002 there were some widening gaps between Starbucks vision and their market survey results. Christine Day realized they had failed in terms of “customer intimacy”; their customer base had changed, yet they hadn’t realized this. Additionally their service level had fallen, with a concurrent increase in the technical and rigorous demands of the barista’s job. The entry strategy into China similarly positioned Starbucks as an elite and ubiquitous brand. In the east and particularly in China, status is an integral part of the culture. Starbucks positioning would therefore appeal to the burgeoning masses of young well educated and affluent class of Chinese society. This market segment had growing purchasing power and an incessant appetite for western brands and status symbols of prosperity and a glorious western lifestyle. They engaged in global market adaptation by customizing their product offerings to cater to local preferences. Additionally they had to demonstrate a greater commitment to Corporate Social Responsibility (CSR), in order to build trust in the new Chinese community, and the menu as well as Starbucks initiatives looked like a blend of east meets west, with use of local teas in partnership