SWOT and PEST Analysis of Starbucks for Marketing Management

This report provides a comprehensive analysis of the SWOT and PEST factors affecting Starbucks in terms of marketing management. It includes an evaluation of the strengths, weaknesses, opportunities, and threats faced by the company, as well as an analysis of the political, economic, socio-cultural, and technological factors impacting its business. The report also discusses the value chain support activities of Starbucks and concludes with a summary of the findings.

Marketing and
management

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
SWOT Analysis .........................................................................................................................1
PEST Analysis............................................................................................................................2
Value Chain support activities....................................................................................................4
CONCLUSION ...............................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Marketing management is define as discipline of organisation which generally focuses on
practical application of marketing techniques, methods and orientation which is inside company
& management of marketing activities and resources (Deepak and Jeyakumar, 2019).
Starbucks corporation is consider as American coffee house chain and company. This
was founded in 1971 in Seattle, Washington. The company is operating 28218 locations globally.
This organisation mainly serve cold and hot drinks, pastries, snacks, juices and so on for satisfy
their consumers. The mission statement of organisation is to nurture and inspire human spirit
such as one person, one cup and at a time one neighbourhood.
In this report it includes identification of SWOT and PEST analysis that may have
impact on marketing mix on Starbucks brand. Furthermore in this report, it also involves
changes that can be uplifted by company which leads to provide better services to their
customers.
MAIN BODY
SWOT Analysis
This is a framework in which there is compilation of organisation's strengths,
weaknesses, opportunities and threats. The primary aim of this analysis is it help company for
develop a full awareness of all factors which is includes in decision making process of business.
This can be used as a tool or technique for evaluation of strategic position of company in many
forms such as local and national government, profit enterprises and so on. Below is a description
of SWOT analysis of Starbucks which is explained below: Strengths: This factor of analysis describe about excels of company which separates it
from competition such as loyal customer base, unique technology, strong brand &
balance sheet and so on. In terms of Starbucks corporation, it has significant geographical
presence all over world and also maintains 39.8 % market share in US having their
operations in about 62 countries. This is considered as best global brand in 2018 but for
more management of company focuses on enhancing market share globally by opening
stores in existing and new markets, deploying technology, aggressive product innovation
and so on. In addition strength of respective company is it serves high quality of product
for their customers (Hollensen, 2019). Furthermore, major strength of organisation
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human resource management which have highly knowledge about services by taking 24
hours training programs. Company also leads a position in mobile capabilities, loyalty
and digital card and so on as by this customers are consuming more beverages/food away
from house by using mobile phones doing online activities. Weaknesses: This analysis stop company for performing at their optimum levels. This is
consider as area where enterprise need to improve for remain competitive in market
segment. In terms of Starbucks, as there is a high price point on some of products which
deter many customers as they might be consider as company as their daily part of life. As
company offers premium quality of products but sometimes customers are not have
much money for spend on cup of coffee. As there are many competitors who are serving
same products such as frappucinos, big chocolate chip cookies which leads to weakness
for company (Kotler and et. al., 2019). Opportunities: These are consider as favourable external factors which provide
competitive advantage for company. In context of respective organisation, there are
several of opportunities for growth in future such as global expansion as company
operates coffee-houses all over world and most of them are located in US. As there are
also start their branch possibilities which involves Central Europe, India and so on. There
is also opportunity for Starbucks as introducing new products and co branding which
helps in maximise value of their company (Morrison, 2018). For example, introduction
of Starbucks in McDonald's.
 Threats: This refers to factors which have potential to harm company. In terms of
Starbucks corporation, there are few threats which have to be addressing such as as there
is a fierce competition among cheaper alternatives such as McDonald's, Dunkin' Donuts
which are directly compete with some of their products that are sell by Starbucks.
PEST Analysis
This analysis is described as framework within which there are analysis of macro
environmental factors which are used in scanning component of environment of strategic
management. It is define as strategic tool which helps in understanding growth or decline in
market, position of business and so on. In terms of Starbucks Corporation, PEST analysis is
discussed below:
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 Political Factors: These factors mainly related to as how government bodies intervenes
in economy. It mainly involves trade restrictions, tax policy, political stability and so on.
In terms of Starbucks Corporation, there is a regional integration as this is current trend
and external factor which creates opportunities for company for expanding business
worldwide (Kotabe and Helsen, 2020). There is also government support which helps in
improving infrastructure for organisation which creates opportunities for it. There is also
threat for company as there is bureaucratic red tape this leads to difficultly for company
to expand their business in developing countries. Economic Factors: These factors involves exchange, inflation, interest rate and so on
which affect business for decision making and operation. In terms of respective
organisation, as due to high economic growth and decline in employment rate creates
opportunities for Starbucks which helps in gaining more revenues in market segment. But
due to rising labour cost in supplier's country leads to threat for company this leads to
increase more money for ingredients. Socio-cultural Factors: This factor mainly includes population growth rate, career
attitudes, health consciousness and so on which affects demand of a product in company.
In terms of respective organisation, there is a opportunity for firm for increase revenue of
company which is based on increase in demand of speciality coffee which is growing
under middle class of world. As company deals in high quality of products which also
creates opportunity for enterprise as customers are becoming more consciousness about
their health.
 Technological Factors: This factor involves technological aspect such as technology
incentives, automation, changes in rate of technological and so on, which helps in
determine minimum efficient production level and so on. In terms of Starbucks
corporation, as there is a opportunity for company due to increase in purchase of mobile
and there is also opportunity by supply chain efficiencies which is based on new
technologies to coffee farmers (Chernev, 2018). But there is also threat for company as
rising in available of speciality in coffee machines which is used by individual at home
use.
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Value Chain support activities
The concept of value chain helps in understand and segregate useful and wasteful
activities which is accompanying at every step at product development process. This can be
define as series of activities or processes which have main motive for adding and creating value
to product. In terms of Starbucks value chain analysis can be divided into two groups such as
support and primary activities which are discussed below:
Primary activities: Inbound Logistics: In terms of Inbound Logistics of Starbucks it mainly refers to
selection of finest quality of beans of coffee which is appointed by coffee producers in
Africa, Asia and Latin America. The beans are unroasted beans which is directly
procured from farmers by buyers of Starbucks. The organisation does not outsource their
procurement to ensure high quality standards from right point for selection of coffee
beans (Chung, 2020). Outbound Logistics: In terms of Outbound logistics there is no presence or bound of
intermediaries in product selling. As becoming new venture company is now launching
new products such as single origin coffees which is sold by some leading retailers in US. Operations: Starbucks generally operates in 65 countries in form of direct selling or
selling through licensed stores. It has almost 21000 stores internationally which involves
Coffee, Seattle's best coffee and so on.
 Services: In terms of Starbucks, the main motive of organisation is to build customer
loyalty by high level of services at their stores. The main objective of organisation is to
become brand of coffee and leading retailer in each of the target market.
Support activities: Human resource management: The company mainly committed to their workforce as
considering major aspect for success and growth over the years of organisation. The staff
members of respective organisation are motivated by incentives and benefits. Mainly
company is known for taking care of their team members this leads to low turnover of
employees. Technology Development: Starbucks is mainly known for well known use of technology
in terms of consistency in quality and taste with cost savings which have to be connected
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with their customers. As many guests visit Starbucks as for make office shift and place
for meeting with having unlimited Wifi system at coffee-houses.
 Infrastructure: This involves all department such as finance, legal, management and so
on which are needed for company for keep their stores operational (Visconti, Peñaloza
and Toulouse, 2020). In terms of Starbucks which is well designed and stores in pleased
manner which are complicated and also offers each and every customers a unique
experience at Starbucks.
CONCLUSION
From above report it has been summarised as marketing management is refers to
framework in which company generally focuses on application such as marketing orientation,
tools and techniques which helps organisation for accomplishment of goals & objectives.
Furthermore, there is a SWOT and PEST analysis which helps for examining and analysing
micro and macro factor of organisation. Moreover, there is also value chain analysis which is
define as a framework which is use for analyse relationship among various parts of operation and
ways in which there is addition which contribute various level of revenues.
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REFERENCES
Books and Journals
Chernev, A., 2018.Strategic marketing management. Cerebellum Press.
Chung, K.C., 2020. Green marketing orientation: Achieving sustainable development in green
hotel management.Journal of Hospitality Marketing & Management.29(6). pp.722-738.
Deepak, R.K.A. and Jeyakumar, S., 2019. Marketing management. Educreation Publishing.
Hollensen, S., 2019. Marketing management: A relationship approach. Pearson Education.
Kotabe, M.M. and Helsen, K., 2020. Global marketing management. John Wiley & Sons.
Kotler, P. and et. al., 2019. Marketing management. Pearson UK.
Morrison, A.M., 2018.Marketing and managing tourism destinations. Routledge.
Visconti, L.M., Peñaloza, L. and Toulouse, N. eds., 2020.Marketing management: A cultural
perspective. Routledge.
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