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Business Plan for Starbucks - Marketing Strategy, SWOT Analysis, and Financial Projections

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Added on  2019-10-09

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This business plan for Starbucks includes a SWOT analysis, marketing strategy, target market profile, and financial projections. Learn about the company's history, products, and competition.

Business Plan for Starbucks - Marketing Strategy, SWOT Analysis, and Financial Projections

   Added on 2019-10-09

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Business planStarbucks
Business Plan for Starbucks - Marketing Strategy, SWOT Analysis, and Financial Projections_1
Executive SummaryIn 1981, Howard Schultz (Starbucks chairman, president and chief executive officer) had first walked into a Starbucks store. From his first cup of Sumatra, Howard was drawn into Starbucks and joined a year later.A year later, in 1983, Howard traveled to Italy and became captivated with Italian coffee bars and the romance of the coffee experience. He had a vision to bring the Italian coffeehouse tradition back to the United States. A place for conversation and a sense of community. A third place between work and home. He left Starbucks for a short period of time to start his own Il Giornale coffeehouses and returned in August 1987 to purchase Starbucks with the help of local investors.From the beginning, Starbucks set out to be a different kind of company. One that not only celebrated coffee and the rich tradition, but that also brought a feeling of connection.Background and HistoryIn 1981, Howard Schultz (Starbucks chairman, president and chief executive officer) had firstwalked into a Starbucks store. From his first cup of Sumatra, Howard was drawn into Starbucks and joined a year later.In 1983, Howard traveled to Italy and became captivated with Italian coffee bars and the romance of the coffee experience.He left Starbucks for a short period of time to start his own Il Giornale coffeehouses and returned in August 1987 to purchase Starbucks with the help of local investors.Description of ProductsStarbucks Corporation (together with its subsidiaries, “Starbucks” or the “Company”) purchases and roasts high-quality whole bean coffees and sells them, along with fresh,rich-brewed coffees, Italian-style espresso beverages, cold blended beverages, a variety of complementary food items, a selection of premium teas, and beverage-related accessories and equipment, primarily through its Company-operated retail stores. Starbucks also sells coffee and tea products and licenses its trademark through other channels such as licensed stores, and through certain of its licensees and equity investors, Starbucks produces and sells a variety ofready-to-drinkbeverages ("Description of Business for Starbucks (SBUX)", 2017). All channels outside the Company-operated retail stores are collectively known as specialty operations.
Business Plan for Starbucks - Marketing Strategy, SWOT Analysis, and Financial Projections_2
SWOT Analysis of StarbucksSWOT analysis of the company gives us a significant information about the strengths,weaknesses, opportunities, and threats of the company. With the help of below-mentioned table one can easily get information about SWOT of Starbucks:StrengthsWeaknessesStrong Financial PerformanceStrong Brand ImageHigh ExpertiseDepends on the AmericasSegmentSlow Expansion in EuropeOpportunitiesThreatsConsumer Packaged GoodsInternational ExpansionIntense CompetitionVolatility in Coffee prices
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Market DescriptionIt is crucial to be aware and understand the environment in which a company is operating in order to implement their strategies successfully. The Micro environment can be analyzed using a SWOT analysis and further completed with a Macro environment study by doing a PEST analysis.While coffee sales are acquired and are at a maturity stage (could be considered as tuxedos products), Starbucks must still make an effort on the brand management for tea and discover a way to develop the evening alcohol sales. Starbucks product management can further determine two product categories: durable (mugs and souvenir objects) and non-durable (beverages sold). Trademarks play an important role in the protection of the "Starbucks culture", due to the copyrights and registered trademarks all the beverage names, images, logos, slogans, or websites common to thecompany cannot be copied by anyone else (Starbucks, 2014). This protects the environment and culture the company has and allows them to maintain their competitive advantage.The products are the starting point to creating value for customers; if they are high quality products that are differentiated from other companies, the customer will remember this and forge his or her idea of the brand. Once these product attributes aredetermined, brand equity comes into place to communicate and confirm the company's values.Target Market ProfileStarbucks’ primary target market is men and women aged 25 to 40. They account for almost half (49 percent) of its total business. Starbucks’ appeal to this consumer age group through hip, contemporary design that is consistent in its advertising and decor,and working to keep its products current as status symbols. Customers tend to be urbanites with relatively high income, professional careers and a focus on social welfare. This target audience grows at a rate of 3 percent annually.Young adults, aged 18 to 24, total 40 percent of Starbucks’ sales. Starbucks positions itself as a place college students can hang out, study, write term papers and meet people. Starbucks appeals to this consumer directly through introducing technology assoon as it comes available, focusing on social networking and actively cultivating a “cool” image. The young adult audience grows 4.6 percent each year.Kids and teens are also a large part of Starbucks’ target audience. Together, customersage 13 to 17 account for just 2 percent of Starbucks’ sales, but most items for kids are purchased by the parents. Whether the focus is on the steamed milk that Starbucks’ baristas refer to as “babyccinos” or the sugary, caffeinated, whipped cream topped coffee drinks that are so popular with teenagers, kids and teens form a large part of Starbucks business. Kids go there with their parents; both mother and child leave with
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