Starbucks: Bir Fincan Kahvenin Ötesinde

Özet:

Starbucks, dünyanın neredeyse her ülkesinde kahve servisi yapan bir mağazalar zinciridir. İlk mağazası 1971’de Seattle, A.B.D.’de açılan zincirin, şu an dünyanın 55 ülkesindeki mağazalarında haftada yaklaşık 20 Milyon müşteriye kahve servisi yapılır.

Stratejik Yönetim kavramının yenilik “inovasyon”la harmanlanmasının en başarılı örneklerinden olan işletme, günümüzdeki halini “müşterilerine ev ve iş yerleri dışında” aynı rahatlıkta hissedebilecekleri üçüncü bir alternatif olarak hayatlarımızdadır.

Sadece Oğlak ve Yengeç dönenceleri arasındaki iklim kuşağında yer alan bölgelerde, yüksekliği 800 ila 2.000 Metre arasındaki plato ve yamaçlarda yetişen organik kahveyi işleyerek dünyanın her yerindeki müşterilerine sunar.

Süt içeceğine en yakışan kahve çeşidinin espresso olması nedeniyle; kuruluşundan bugüne değin; bu kahve türünün ana vatanı olan İtalya, Amerika asıllı markanın esin kaynağı olmuştur. İtalyan’nın yüksek rekabetle büyüyen kahve piyasasına girmeyerek, Batı Avrupa’nın diğer ülkelerinde açılan kahve mağazaları; bulundukları ülkenin damak tadına uygun, bir başka ifadeyle; “kültüre özel” kahve ve aperatif yiyecek servisi ile müşteri kitlesini gün geçtikçe artırmaktadır.

Dünya’daki her servis noktasının mağaza yönetimi ve iç müşteri kültürü (işgören) neredeyse aynıdır. Bu sayede, dünyanın hangi Starbucks Mağazasına giderseniz gidin, benzer bir yaklaşım ve ortamla karşılaşırsınız.

Müşteri memnuniyetini öncelikli kılan bu yaklaşım, mağazaların fiziki yapılarında da gözlemlenir. Rahat koltuklar, ders çalışma alanları, sürekli ücretsiz internet imkanı ve rahatsız etmeyen müzik arşiviyle, kahve tutkunlarına ev ve işyerleri dışında rahat edecekleri bir “üçüncü alternatif özel alan” imkanı sunar.

Müşteri memnuniyetinde beş duyuya hitap eden Starbucks yönetim stratejisi; kahve tadı ve kokusu, standart müziği, kadifemsi ve rahat koltukları, şık iç mekan tasarımı ile inovasyonu en etkin kullanan örnek işletmelerden biridir.

Şirket kültürünün farklı kişilerce yönetilmesini tercih etmeyen Starbucks Yönetim anlayışı, franchising yapmaz ancak; Orta Doğu, Rusya ve Türkiye Mağaza yönetimini “Major Franchising” adı altında Shaya Group’un sahibi Muhammed El Shaya’ya vermiştir.

STARBUCKS: BEYOND A CUP OF COFFEE

Starbucks, a coffee brand from USA, has entered the Turkish Market over the passed two years. Although Turkish people have their own traditional coffee culture, Starbucks serves a new taste of coffee to Turkish people living in big cities from any age level.

In this article, we will be talking about the success and history of Starbucks.

Before the discussion of main titles of the article, we would like to comment on some ethical issues. According to ethical research rules, this article has been prepared as a compilation. All information from academic articles and websites has been read and evaluated and then the article was created by interpretation.

  • First of all, history of Starbucks Company on spotlight:

In 1971, the first Starbucks Coffee Shop started serving run by three businessman in Seattle, USA. The fist shop was tiny but the idea was getting as a snowball. The official company was established as public in 1982 and after 28 years, the company currently holds about 40 percent of the speciality coffee market. Besides, it used slow but sure business growth approach. If development of the company comes under spotlight, certainly the success has not been developed in an instant. Currently, Starbucks shops have expanded throughout many countries around the world. Now, the Starbucks Company has more than 20,000 locations in 55 countries serving over 20 million customers a week.

  • Starbucks’ mission statement is:

Establish Starbucks as the premier purveyor of the finest coffee in the world while maintaining our uncompromising principles while we grow.” It is actually very true. They have been growing up as a brand without compromising their own principles. The line of the company’s strategy is very clear; drinking high quality coffee and comfortable environment with smooth jazz music on the background. Customer oriented services value the “happiness is only real when shared” philosophy.

  • Emotional connections and customer satisfaction are the secret for success of

Starbucks Company: extension of people’s front porch…an emotional experience

Every Starbucks shop environment serves to customers under the notion that they could be part of something that they can believe in and can associate themselves with a product that they can rely on. It is only true in terms of management strategies by which companies are satisfying some part of emotional needs of customers. Besides, Starbucks serves different than just selling a cup of coffee. Its education program also involves employees to acting in the best way to approach customers. Let’s look at some details about emotional connection ways:

  1. I. Focus on the customer: One of the philosophies of approaching customers is: “Starbucks is not in the coffee business serving people. Starbucks is in the people business serving coffee.”

  1. II. Team leaders focus on creating a shared vision for all employees, “Servant Leadership

In other words; an ideal leader behavior and logic might consist of the following: fostering of interdependence, honesty, empathy and managing with respect; owned and operated by company/employees, not as a franchise but acting as one organization, and not functional silos, but learning from each other.

Store Manager

Assistant Manager

Shift Supervisors

Baristas       Baristas       Baristas

This is a basic organizational chart of a single Starbucks shop. The chart shows that every single shop system is like a very simple company.

Every company has its own IT so Starbucks’ IT structure is as follows:

  1. III. Being a Starbucks employee: Acoording to an interview of one of the Starbucks’s Shop employee, Nispetiye – Istanbul, working for Starbucks is a privilege. Because of the negative Turkish economic environment and the increase in educated unemployed young people rates, Starbucks has provided young people with both full and part time job opportunities. Besides this, it is well known that the employees of the company has reached 7.400 around the world.

  1. IV.  Starbucks also serves customers by enabling them to connect to the Internet in every coffee shop. This actually means that the customers can easily connect and get work done in coffeehouse’s comfortable and free environment while sitting at the comfort of their favorite cozy chair enjoying their coffee.

  1. V.  Starbucks is a household brand name in over 55 countries around the world. The strategy has been developed as culture oriented. In other words, if the company decides to open a new shop in Rome, the shop menu should have traditional espresso, even in Turkey.  Turkish people can enjoy the traditional Turkish Coffee when  they are sitting at Starbuck’s comfortable chairs.

  1. VI.  Feel the unique experience, think individually: The main goal of Starbucks customer approach is to convey the message “please feel like at home”  and to satisfy the customers all the time. As explained before, Starbucks serves more than the taste of its coffee and has slowly changed the Turkish people’s instant coffee culture [1]. According to the traditional point of view;  how did the Turkish people easily welcome Sturbucks and how did it get more popular? Undoubtedly, there are a number of factors,  more than the taste of its coffee. The taste has propelled the success itself and some of the things that Turkish People have got different experiences out of Starbucks. Despite the size of the high rate of market share of granule coffee as explained, Starbucks has offered  different than a cup of coffee to customers and expanded succesfully at the Turkish market place. It means that customers feel free when they are in Starbucks shops. According to experiences, it is actually very true that you can sit and do anything with buying just a one cup of coffee,  nobody disturbes you.

  1. VII. How did they start a new country market; in the case of Turkey: The company of Starbucks decided to serve at the three largest cities in Turkey, as they have in other countries. The concept itself that haven’t existed before in Turkey, the coffee house and/or shop as a elegant place concept, has made the shops a center of studying, reading, discussing. It is very common among students and young business people to spend their break time and leisure time at Starbucks instead of an office or an apartment.

  1. VIII. Customers can  prepare the Starbucks’ fine quality at home; selling products with Starbucks brand at their shops: Starbucks customers can also easily reach the products and feel the same comfort and taste at their homes. This shows us that drinking coffee has naturally gotten a traditional way in every culture as style of services, tecnique of cooking… etc. So, Starbucks culture itself has adopted and respected foreign countries' traditional ways of making traditional coffee in 55 countries where the Starbucks shops are servicing. Besides this, as mentioned above, the Starbucks coffee beans are available at their shops with mugs and other preparing stuff like termos and coffee machines.

  1. IX.  And the last part of the customer relationship strategy of the Starbucks is the third place experience provider. It means that the coffee shop represents a place between work and home to relax, meet friends, and enjoy a great cup of coffee.

In addition to all of the explained factors above, Starbucks Company gives casual feelings to customers and assurance to employees when they are working and tasting the delicious coffee. These factors show that Starbucks traces the path of customer and personnel relationship in terms of infinite satisfaction.

At the following section, you can see an explanation about what the Starbucks Company serves.

  • Product Line: Have you ever thought about what other brands Starbucks sell other than coffee? The market strategy should not only be customer oriented but it also should be supported by psychological orientation to purchase the products. Product diversity could be different for every country.

As known, as Starbucks has entered the Turkish market in the last two years, some Turkish people, who have been to or visited abroad, especially Western countries; such as Europe and North America, have already known what Starbucks is. Shops of Starbucks serve delicious filter coffee to customers. In this section, we would like to talk about the Starbucks products in Turkey.

Espresso –based Drinks

  • Caffé Latte
  • Cappuccino
  • Caramel Macchiato
  • Caffé Mocca
  • White Chocolate Mocca
  • Caffé Americano
  • Espresso
  • Espresso Macchiato
  • Espresso Con Panna

Classic Products of Starbucks:

  • Coffee of the day
  • Caffé Misto
  • Press Coffé
  • Turkish Coffee

Other Delicious Alternative

  • Tazo Chai Tea Latte
  • Premium Hot Chocolate

Alternative Espresso-based Cold Drinks

  • Caffé Latte with ice
  • Iced Caramel Macchiato
  • Iced White Chocolate Mocca
  • Iced Caffé Americano
  • Iced Chai Tea Latte
  • Orange Juice

Coffee – based Snowy Cold Drinks

  • Coffee
  • Java Chip Chocolate
  • Caramel
  • Espresso

Caramel – based Snowy Cold Drinks

  • Vanilla
  • Java Chip Chocolate
  • Caramel

Fruit – based Snowy Cold Drinks

  • Rasberry Black Currant
  • Mango Passion Fruit

If you select your coffee from the alternatives above, Starbucks’ staff can serve your coffee in different sizes of cups as follows:

Name

Measurement

Notes

Short

8 oz (≈ 237 mL)

Tall

12 oz (≈ 355 mL)

Grade

16 oz (≈ 473 mL)

Italian for Large

Venti

20 oz hot (≈ 591 mL), 24 oz cold (≈ 710 mL)

Italian for twenty

Trenta

31 oz cold only (≈ 917 mL)

Italian for thirty

http://en.wikipedia.org/wiki/Starbucks

On this section, several factors of the Starbucks company success is explained.

There are a number of factors that propelled Starbucks to the forefront. Below are some of the things that you can learn from Starbucks company which was started as a small company, but dreamed big and grew to be a gigantic global corporation. Now we would be trying to answer the question: “ They grew fast but how?”

  • Market Dominance:

  1. I.  So many Starbucks shops are located at popular shopping centers and their neighbors are usually dry cleaners, inside or nearby shopping malls and some other places of work traffic or lunch areas. In other words, Starbucks avoid locating stores in close proximity to fast food chains.

  1. II. Some bookstores have started to have their Starbucks inside. The first example to this is that in 1993, Starbucks Corporation started a relationship with Barns and Noble, Inc. This enterprise has started other new corperations around the world and  afterwards; since, they have won accounts with many other companies, such as:

  1. Sheraton Hotels (now Starwood Hotels)
  2. United Airlines
  3. Nordstrom
  4. Canadian Bookstore Chapter
  5. Westin Hotels
  6. Canadian Airlines
  7. Kraft Foods (to extend into grocery stores)
  8. Hyatt Hotels Corp.

  1. III. 28 years of expanding strategy was complete that nowadays Starbucks stores are located in 55 countries and serve locational products to their customers. It is really quite a mind-blowing strategy to being almost the first world wide company within 28 years. In other words, Starbucks communicate the unique coffee culture to millions and millions of people evey day. Here are some of the customers’ words and one of the sample Starbucks’ snapshot below: "I sneeze, and I end up in Starbucks. I jump, there's a Starbucks. I trip and land in Starbucks. I want to move into a Starbucks."

Currently Starbucks is present in more than 55 countries.

North America and Caribbean

South America

Oceania

Europe

Africa

Asia

  • Aruba
  • Bahamas
  • Canada
  • Mexico
  • United States
    • Puerto Rico

  • Argentina
  • Brazil
  • Chile
  • Peru
  • Australia
  • New Zealand
  • Austria
  • Belgium
  • Bulgaria
  • Cyprus
  • Czek Republic
  • Denmark
  • France
  • Germany
  • Greece
  • Ireland
  • Netherlands
  • Poland
  • Portugal
  • Romania
  • Russia
  • Serbia
  • Spain
  • Sweden
  • Switzerland
  • Turkey
  • United Kingdom
    • Jersey
  • Egypt
  • Bahrain
  • People's Republic of China
    • Hong Kong
    • Macau
  • Republic of China
  • Indonesia
  • Japan
  • Jordan
  • Lebanon
  • Kuwait
  • Malaysia
  • Oman
  • Philippines
  • Qatar
  • Saudi Arabia
  • Singapore
  • South Korea
  • Thailand
  • United Arap Emirates

International presence of Starbucks stores

http://en.wikipedia.org/wiki/Starbucks

IV.   Key success factors of Starbucks:

Creative Group;

The creative group has dedicated itself  passionately to expressing the essence of Starbucks brand at every customer touch-point. How do they do that? This point proves the importance of the concept of Starbucks. Let’s present these details under spotlight:

  1. Napkins, paper cups,
  2. in-store posters,
  3. T-shirts
  4. Gift cards

Reason for Group Success is living the brand itself, in other words; success in articulating the brand so well.

And here is one of the members’ comment of the Starbucks’ creative groups;

That’s our ongoing challenge here, to avoid being mundane, to continue to find the excitement in the product.  As long as we keep delivering that surprise to our customers, we’ll be successful - both commercially and creatively.”

Mass Customization;

Every customer is unique: individually customize goods/services to create a unique experience for customers. Customers are showing that they will pay much more for the entire experience. Some of beneficial factors are improvement sales, customer loyalty, retention, turns of goods into a services and a service into a memorable experience. Besides, this shows that the main difference from competitors is that Starbucks is known for being the company that gives the customers exactly what they want.

Here is one excerpt from website of the Starbucks’ Company;

“We have shifted from a goods economy (coffee beans in a can) to a service economy (hot coffee at a diner) to an experience economy (coffee sold in a special mug, in comfortable surroundings - Starbucks)”

Vulnerabilities and Watch out;

  1. Foreign Policy
  2. Fair Trade; The world’s biggest coffee retailer purchases one percent of all coffee on the globe, but less than one percent of that is fair-trade
  3. Companies’ Milk Policies;  if activists get Starbucks to “surrender” and dump all food that includes bio- ingredients, the really big fish. In other words, aim at a high-profile company like Starbucks that is vulnerable to challenges to its reputation for being “socially responsible”.
  4. Employees Union
  5. Exploitation to third world Farmers
  6. Major Inventory deficit because of china
  7. Coffee growers quitting  the business
  8. Imbalance in production
  9. Voice Marketing; abandon the personality
  10. Hear Music Media Bars; venture has been very disappointing, few customers listen to music; only 1 CD burned
  11. Cyber Attack; an impending online attack from the Organic Consumers. Association, a group devoted to eliminating all genetically engineered food.
  12. Misuse of Broadband; slower Speed and streaming popup
  13. International Competition
  14. Marketing Cornucopia
  15. Starbucks is beginning to define itself too broadly; “Much more than a coffee store - we are an ‘alternative distribution’. Fall into the trap of trying to be all things to all people, results in consumers no longer being able to relate to what made the company remarkable in the first place and should stick with defining themselves as a “Third Place” experience provider[2].

  1. V.   Innovating, innovation itself!

A “stores of the future” team was created in 1995. They started to work “shop focused” instruction.

The team researched the art and literature of coffee throughout the ages, studied coffee-growing and coffee-making techniques, and looked at how Starbucks stores had already evolved in terms of design, logos, colors, and mood. The team, came up with four store designs—one for each of the four stages of coffee making: growing, roasting, brewing, and aroma—each with its own color combinations, lighting scheme, and component materials. Within each of the four basic store templates, Starbucks could vary the materials and details to adapt to different store sizes and settings (downtown buildings, college campuses, neighborhood shopping areas)[3].

Keep an eye on the future: As well known, in the knowledge economy and strategy must focus on expanding existing markets or creating new ones, not beating the competition[4].

The strategy of innovation of the Starbucks is like strategy of kai-zen. It means that, cultural pattern of the Starbucks is the same; concept, style, quality and respect traditional cultural patterns. Service innovations have been prevalent to ensure that orders are executed properly and effectively.

Most people might think of Starbucks, for instance, as a fancy coffee joint. Not Chairman Howard D. Schultz. He sees the store chain as a "third place" for people to hang out besides home and work. That's why a seemingly unrelated service -- offering wireless Net access in its stores starting two years ago -- turned out to be a winner. Although Starbucks Corp. won't quantify the revenue impact, people using the service stay nine times longer than the usual five minutes, almost certainly buying more lattés. And 90% of customers who log on are doing so after peak morning hours, filling stores during previously light periods. Says Anne Saunders, Starbucks' senior vice-president of marketing: "If we'd only thought of ourselves as a coffee company, we wouldn't have done this.

  1. VI.  Starbuck’s SWOT

  • Strengths:
  1. Starbucks is No. 1 specialty coffee retailer of - in terms of market share and market capitalization. (1997, £4596.6 million and sales growth 20.9%)[5]
  2. It is a global organisation with 16,000 coffee shops in 55 countries world-wide.[6]
  3. Strong brand image associated with high quality coffee and excellent customer service - “The Starbucks Experience”.
  4. Due to its specialism in all things coffee - it achieves high buying volumes - scale economies and utilizes international sourcing, some from fair trade suppliers.
  5. Committed workforce, one of Fortune Top 100 Companies to Work for[7]
  • Weaknesses:

  1. Starbucks is a premium brand commanding premium prices. As competitive pressures increase, the company could be undercut by lower price rivals such as McDonalds or Costa Coffee.
  2. Starbucks is seen as an “American Global”, possible perception that big American chains are trampling on national cultures, “Starbucks was trampling on Chinese culture”[8].
  3. Over-dependency on coffee and coffee related products.
  4. US based company, focus on the US domestic market.
  5. Reputation with pressure groups. Criticized for not using more Free trade products[9].

  • Threats:

  1. Possible saturation in the coffee, café market. In the US, 600 underperforming company-owned stores were closed[10]. Consolidation on the high street, growing competition from national brands and new entrants, aggressive marketing (price wars, promotions), putting pressure on profit margins. Companies seek cost savings and new way to differentiate to retain customers.
  2. Several activist groups maintain websites criticizing the company’s fair-trade policies, labour relations, and environmental impact[11].
  3. Recession or downturn in the economy affects consumer spending, with less disposable income to spend. Consumers defect to lower price venues and competitors.
  4. Raw material cost rising - Starbucks is exposed to rises in the cost of coffee, labour and dairy products, and adverse changes in exchange rates[12].

  • Opportunities:

  1. Significant opportunities exist, especially outside domestic US market for joint ventures. Starbucks could overcome planning restrictions, reduce costs through co-locating at supermarket chains, pubs & restaurants.
  2. Product range diversification into greater food ranges and non-food items. The company has experimented with warm sandwich lines, and I-tunes (music link)[13]. Also, sold music CD’s and linked with clubs (e.g. book clubs) etc.
  3. Licensing its name (e.g. ambient coffee through supermarkets) could provide new streams of revenue[14].
  4. Through CRM and database marketing it could target its high net worth customers and build greater loyalty with customer base. The introduction of loyalty schemes such as Starbucks Card, free re-fills and technology (free downloads of music) provide a competitive edge to its value proposition[15].
  5. Continued focus on improving efficiency and effectiveness in the organisation, from procurement, to supply chain to customer service delivery[16].
  6. Become more of a socially responsible brand. Better public relations activity, introducing more fair trade products, better distribution of profits to farmers and ethical sourcing practices.

  1. VII.  Three step action plan for improvement:

  1. Decrease employee turnover rate; focus on hiring older employees where benefits package is more appropriate, base raises on performance rather than maximizing raises for economic reasons, develop and actively maintain a reward system for employees (i.e. employee of the month) and develop a system of regular employee communications / meetings.
  2. Improve site accessibility and cleanliness; upgrade front door and restrooms for handicapped accessibility, add a baby changing station, redesign restroom to separate cleaning supplies from bathroom or move cleaning supplies to another location, focus employee attention on restroom cleanliness
  3. Enhance Starbuck’s differentiated atmosphere; utilize entertainment budget to hire outside entertainers, have book / poetry readings, etc., display the store’s collection of games and activities more prominently, make the location more of a “scene.

In conclution:

  1. After reading almost hundreds of articles and research, there is no doubt that, “Starbucks” is the most popular worldwide coffee brand in the world.
  2. It was established as a tiny shop, but entrepreneurs developed the company within 28 years.
  3. It is the most preferred coffee company for every age of customers. Everyone enjoy it!
  4. Starbucks produces gourmet coffee and is a social experience and this needs to be marketed to the targeted consumers
  5. It needs to stay focused on the customer to ensure continued success and ward off constant threats
  6. It needs to capitalize on opportunities like expanding internationally and creating additional revenue streams


[1] Instant coffee culture has started with granule coffee in Turkey. The most popular brand, Nescafé, entered the market in the last decade so teenagers’ coffee culture was formed in line with it. Since preparing Nescafé is fast and easy, young Turkish students studying at the universities have been influenced by the marketing policies of Nescafé at the university stands. The consumption of Nescafé especially increased during the examination periods of the students.

[2] http://www.powerhomebiz.com/vol144/starbucks2.htm

[3] http://www.mpdailyfix.com/starbucks-building-innovation-with-customers/

[4] http://www.businessweek.com/magazine/content/04_41/b3903462.htm

[5] Starbucks Corporation, http://www.hoovers.com/starbucks/–ID__15745–/freeuk-co-factsheet.xhtml

[6] Starbucks Corporation, Annual Report 1996

[7] http://search.forbes.com/search/find?MT=starbucks

[8] International Business 6e by Charles W. L. Hill, McGraw Hill

[9] http://en.wikipedia.org/wiki/Starbucks

[10] Starbucks Downside, Wall St Journal, 1 July 2008

[11] http://en.wikipedia.org/wiki/Starbucks

[12] Bennett, R (1996) International Business: Pitman Publishing

[13] Starbucks Annual Report, 2006

[14] Starbucks Annual Report, 2006

[15] Starbucks Corporation, Annual Report 1996

[16] Johnson and Scholes (1999) Exploring Corporate Strategy, Prentice Hall