Brand Psychology: Luxury Watches as a Brand Extension for Starbucks

Brand Psychology

EXECUTIVE SUMMARY
The following report is based on Starbucks which is a coffee and coffee house chain. This
entity currently deals in provision of beverages of different aromas and flavours. To enhance the
brand positioning, management of this firm is executing brand extension by coming up with
luxury watches in market. The new product will be launched for a number of occasions such as
formal, casual, males, female, gift purpose etc. The luxury watches would also work as a fitness
band with heart beat measuring instrument. STP analysis of new brand portrays that the market
would be segmented demographically whereby Starbucks will target individuals belonging to
age group of 24 to 60 coming under middle and elite class. The positioning of this would be done
by way of digital marketing and social media. Premium pricing strategy would be used for
luxury watches so as to be perceived as a product of high value by the people.

Table of Contents
EXECUTIVE SUMMARY.............................................................................................................2
INTRODUCTION...........................................................................................................................1
Brand Audit......................................................................................................................................1
Overview of the Brand................................................................................................................1
Current market share and major competitors..............................................................................2
How the brand’s products and services are currently marketed and branded.............................2
Brand Segmentation, Targeting and Positioning........................................................................3
Product/Service Idea........................................................................................................................4
Describe and justify why your new product/service is an attractive market opportunity...........4
Benefits of Brand extension for the branded company...............................................................5
Brand Proposition............................................................................................................................6
USP, brand values, brand personality, brand identity and demonstration of how these are
mutually supportive.....................................................................................................................6
Brand Execution...............................................................................................................................7
Overview of price, place and promotion strategies for the extension along with discussion
over how these will support brand values, personality, and identity..........................................7
Importance of Persuasion to brand..............................................................................................8
Measurement....................................................................................................................................8
Suggest and justify appropriate brand measurement techniques for your new brand launch.....8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Brand can be referred to as the name, symbol, design, term or integration of all of these
for the distinct identification of merchandise and facilities apart from the rival firms operating
within the confines of same corporate industry (Buil, Martínez and Matute, 2016). Brand
management is an essential process for each and every brand operating within the market. This is
concerned with the management of perceptions of individuals who have or have not taken an
experience of the offerings of brand. In this regard, brand extension is a strategy which is used
by corporations with a view to enhance and capital upon the brand equity. Hereby, brand
extension can be defined as the marketing strategy whereby a firm uses the existent brand name
to come up with a new product category in market.
The present project is based upon Starbucks which is a coffee corporation and coffee
house chain. The firm operates with its 30000 outlets across the globe. Owing to such an
extensive global presence, the management has now come up with “luxury watches” to facilitate
brand extension. This is being done to maintain the goodwill at market and enhance the brand
positioning.
Brand Audit
Overview of the Brand
Starbucks is the most renowned brand famous for its beverages and snacks, whereas it is
also an inspiration for most of the new and small eatery ventures. It was founded in 1971 in
Seattle Washington by three Americans named Gordon Bowker, Jerry Baldwin, Zev Siegl. With
the worldwide level chain of thirty thousand branches (Faasse and et. al., 2016). It took about
nine years to get the market recognition as it first came as a profitable venture in early 1980s in
Seattle, Washington. In 1996 Starbucks opened its first branch outside North America in Tokyo,
Japan. In 1999, Starbucks tried new innovations with eateries at San Francisco Bay area with a
giant restaurant chain formerly named as Circadia, and after getting recognized by the people
about that restaurants were directly owned by Starbucks, Starbucks then transformed the
restaurants into Starbucks cafes, which ultimately brought up revolution in the restaurants and
cafes market. Nowadays Starbucks offers products in these segments as Coffee, beverages
smoothies, tea, baked goods and sandwiches.
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