Marketing Plan for Bubble Tea in Canterbury

This report includes the marketing plan for Starbucks to launch Bubble tea in Canterbury. It covers situational analysis, market segmentation, target market profile, product positioning, measurable marketing objectives, and marketing strategies.

Introduction to Marketing
RUNNING HEAD: Marketing 0

Marketing 1
Executive summary
The marketing is all about the action of promoting and selling goods or services. This report
includes the marketing plan for Starbucks. The company has planned to launch Bubble tea
which is originated from Taichung. It is a quite popular and hugely distributed beverage in
various nations. I have been appointed as marketing manager for Bubble tea in New Zealand.
The plan comprises the situational analysis and market segmentation, profile of the target
market and positioning of the product. The measurable marketing objectives have been
decided in the report along with the marketing strategies. Finally, coordination and control
have been described for the marketing decisions.

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Contents
Executive summary....................................................................................................................1
Situational Analysis...................................................................................................................3
Market segmentation, the profile of the target market and positioning of the product..............6
Measurable marketing objectives...............................................................................................8
Marketing strategies...................................................................................................................8
Integration and link...............................................................................................................10
Coordination and control..........................................................................................................10
References................................................................................................................................12

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Situational Analysis
Description of New Zealand Canterbury area
Canterbury is a region of New Zealand. The unique demographic, economic conditions and
geographic location make Canterbury area an interesting place to conduct business
operations. It is a small and isolated economy which fosters innovation. This country is less
affected by the financial crisis than other countries. Canterbury has gained popularity as the
easiest place for doing business. The economy here is also growing on a constant basis. The
average growth rate is expected at a 2.9% annual for the next five years. Such factors make
Canterbury ideally suitable for promoting entrepreneurship and innovation.
Analysis of market, customer needs and changing trends of the market
Starbucks is having almost fifty stores in New Zealand. The decision of the company has a
significant role in introducing Bubble tea in the market of Canterbury. There is in the market
of Canterbury. The trend of the coffee market is changing in New Zealand. The trend of
specialty coffees and single serve methods is becoming popular in the market of Canterbury.
In such a scenario, the introduction of Bubble tea by Starbucks can be really innovative. The
customers also tend to try new tastes. Add on, the certification is also no longer option but a
requirement in the market of New Zealand which is the biggest advantage for Starbucks.
Analysis of competitors
The thirst of the popular Asian drink “Bubble tea” is growing in the Canterbury as stores
have started offering this new drink. The Bubble tea was originated in Taiwan in the 1980s.

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This drink has now become popular worldwide. The sales of Bubble tea is growing by almost
20% annually in overall New Zealand. The competitors identified by Starbucks in the market
of Canterbury are:
Hullu cat: Hullu cat offers a slice of the Taiwanese culture to the heart of Canterbury. The
company is serving tasty tapioca pearls. These pearls have the finest chew amongst a
delectable milky tea.
Noah’s ark: The company has introduced some new favorites. Noah is offering teas to the
extensive customer base in New Zealand with a smile.
Gong Cha: Gong Cha offers bubble teas which are made from freshly brewed teas. The
company is the home of the high-quality ingredients and infinite flavor options.
V&V Bubble Tea: V&V uses a process known as ‘Teapresso’. The drinks of V&V are
packed with the extracted flavors and nutrients. The customers can even get their drinks
customized for an anime illustration on the cup for free.
Internal environmental factors
The internal environmental factors which have an influence on the Starbuck’s marketing
objectives are:
Competitive rivalry: Starbucks faces a strong force of competition in the industry. The
competitors identified by the company are V&V Bubble Tea, Noah’s ark, Gong Cha and
Hullu cat. The competitors are making consistent efforts in order to innovate, specialization
and come up with the strategies so that new customers can be attracted. There is a low
switching cost for the customers which make the competition more powerful (Atwal &
Williams, 2017).
The threat of new entrants: There are several numbers of entry barriers to this industry. It
necessitates an enormous investment to launch a product and set up a store. It takes time to
create brand loyalty for a brand. In the case of Starbucks, has also gained customer loyalty
which makes new entrants to attract them.
Bargaining power of suppliers: There is low bargaining power in the case of suppliers. The
material used by the company is supplied through a number of suppliers. Starbucks is having

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a large figure of suppliers in New Zealand. Add on, the switching cost for the company is not
high (Brotspies & Weinstein, 2019).
Bargaining number of buyers: The bargaining power of the buyers in the scenario of
Starbucks is high. The company is opposing forceful competition which indicates an
profusion choice for the customers (Li, 2018). If the company tries to increase the price then
the buyers can simply walk away as switching costs are low for them. Here are also
convinced customers who are less delicate to the prices and will continue to acquire from
Starbucks even if the prices marginally increases (Krishna, 2018).
The threat of substitutes: The products made available by the Starbucks have alternates. The
products made available by the company are tea, coffee, and food items. The threat of the
substitutes is high as coffee and tea have substitutes like juice, drinks and other beverages.
External environmental factors
The external environment of New Zealand comprises the following:
Political factors: New Zealand is having a stable government and having robust rules and
regulations. The political changes take place in the country after every 3 years and the new
government implements own instructions and regulations (Kelsey, 2015). New Zealand has
provided business and trade freedom to the companies so that they can conduct businesses
easily.
Economical factors: The economic situation is superb and the per capita income is also just
perfect in the comparison of other nations. The prices of the products are reasonable and
people can afford to purchase products effortlessly (Baik, Kim & Patel, 2019).
Social factors: The social system is delightful. It depends on other nations for the business.
There is regular demand in the economic system which affects the economic state of the
nation. There is a dependency on other nations for enabling new technology so the fewer
amount is spent on the research and developmental activities (Ross, Fountaine & Comrie,
2015).
Technological factors: New Zealand has made substantial development in the technology
which has resulted in producing innovative products. The technology is used in
manufacturing goods which attracts customers to purchase the products. IT technology can be
found in every area like urban and rural (Locke& Cave, 2018).

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Legal factors: The companies from other nations are always welcome to initiate the business
in New Zealand. There is great scope for the companies to develop business. Trade and
business freedom is also provided to the companies for expanding the business. International
companies can smoothly flourish their business in New Zealand.
Environmental factors: New Zealand is having a unique ecological system. The population
of the country is educated and aware of the changes taking place in the environment (López-
Gamero & Molina-Azorín, 2016). The best technology is adopted in the country to deal with
the garbage which restraints to pollute the environment (Kang & Namkung, 2018).
Market segmentation, the profile of the target market and product positioning
Market segmentation
The market segmentation is all about dividing the market into the several clusters of buyers
with the diverse needs, features and behavior which necessitates separate products. Starbucks
is mainly based on the socio-economic segmentation based on the consumer markets. The
company has a main focus on the social class specifically business class people who work at
the office and like to have a cup of coffee or tea accompanied by good atmosphere and
facilities (Melancon & Dalakas, 2018). The company has also segmented the market by the
geographic and demographic perspective through the selection of store location where the
capable and coffee lovers can find out. The market segmentation of Starbucks can be
categorized into the demographic and geographic segments:
Demographic segmentation: The main target of Starbucks consists of men and women
between the ages of 25-44. It helds for 49% which is exactly half of the whole business. The
young adults aged 18-24 are also targeted subsequent by Starbucks. The young adults are
accountable for 40% of the sales of the company.
Geographic segmentation: The geographic segmentation is also used by Starbucks. The
outlets of Starbucks are located at various locations in Canterbury. The Starbucks can be
found anywhere in Canterbury like upscale locations, near offices, college campuses, railway
stations, malls, shopping arcades and petrol pumps (Heredero & Gallego-Gómez,2016).

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Behavioral segmentation: The behavioral segment of Starbucks consists of both males and
females. These are the hardcore loyal of the brand and are not in the condition of changing
their preferences. These are the customers who are ready to pay for Starbucks drinks at any
cost. These are the easy-going, determined and ambitious customers. They like to enjoy
quality coffee in a soothing atmosphere. Such customers are also identified as regular users.
Psychographic segmentation: This segmentation includes customers from the middle and
upper class. According to the lifestyle, such people are identified as having a lifestyle of
mainstreamer, aspirer, succeeder, explorer, and reformer. These are the most educated
customers (Wu, 2017).
Profile of the target market
The customers targeted by Starbucks are:
Young adults (18-24): Starbucks target the young adults aged 18-24 through the evolution of
the technology and advanced ideas. The young adults consist of college students who like to
hangout, study and meet people. The young adults are targeted by the company by offering
innovative taste. Bubble tea has that capacity to appeal to customers. People are also offered
special discounts on the birthdays and anniversaries. It helps in influencing customers
towards a purchase.
Men and women (25-44): Starbucks is capable of targeting this group by providing specific
drinks which petition to them. The company targets this group by forming 3rd place as a place
between work and home. Starbucks offer a unique and seamless experience to the customers
within the range. This group incline to have high income and aspires professional careers.
The company also provides the option of the card. The cardholders can get a discount on the
purchase made by them (Taecharungroj, 2017).
Tourists: The tourists are also targeted by the company. Starbucks has established image
worldwide. The customers visiting Canterbury clearly identify the outlets of Starbucks and
like to have a familiar taste. Starbucks target to the tourists and will offer them the Bubble tea
as per their taste.
Positioning of product

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Starbucks has been successful in positioning itself as a most cherished brand. The company
has positioned itself as a most distinguish brand which is capable of differentiating its brand
from the competition. It is the biggest advantage of the company. Starbucks follows three
types of positioning:
Mono segment positioning: Starbucks target first-class customer segment like people who are
ready to pay additional in order to attain high-quality products and services (Steenkamp,
2017).
Adaptive positioning: Due to the affinity of improved customer health awareness, the
company introduced Bubble tea as it is enriched with fruits and carries fewer calories. It is
available in flavors like raspberry milk tea (Arbouw, Ballantine, & Ozanne, 2019).
Standby positioning: Specific beverages of the company like Frappucino waited for a long
time for the changes in the market for a specific period of time to search for demand.
Measurable marketing objectives
Before launching of Bubble tea, Starbucks has decided certain marketing objectives.
 Starbucks has decided to achieve 33% of the market share of Bubble tea by the end of
2019. The company has thought of promoting Bubble tea through several promotions.
Starbucks has even planned to increase sales through this specific product. The
company has even anticipated replacing the most prevalent dinks of the company.
 Starbucks will collect 37% of its revenue from the sales of Bubble tea by 2020.
Bubble tea will be a complete healthy drink so it is going to target 100% people in
Canterbury who are health conscious.
 15% discount will be provided to the first 100 customers after the launch of the
Bubble tea. Starbucks will even supply Bubble tea to the 30 stores nearby Canterbury.
Marketing strategies
Product decisions

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It is recommended to launch Bubble tea in the popular outlets so that customer feedback can
be known on the smaller level only. It will company in the initial stage and can serve as a
trial. The company can later launch Bubble tea in the small stores and the changes can be
implemented (Bui, Nguyen, & Pham, 2017). This will assist the company in knowing the
preferences of the customers before establishing Bubble tea on a large level. Starbucks
innovates on a regular basis in order to capture a larger market. As a marketing manager of
Bubble tea will focus on expanding the market reach of Starbucks. The company will provide
new flavors to the customers to attract a diverse group of people. It is recommended to the
company to fill a feedback form from the customers who visit the store on a regular basis.
Pricing decisions
The prices will be kept low in the initial stage so that the customers do not hesitate to try a
new product. The company can later convert it into its premium pricing strategy. The
behavioral tendency of the people should be known for purchasing luxurious products on the
basis of the professed correlation between high price and high value (Steenkamp, 2019). It is
recommended to the company to maintain high-end specialty image. Starbucks can introduce
Bubble tea in breakfast as a pairing with some food items at $3.95. Pricing is no longer an
issue when it becomes the desire of the target market.
Place decisions
Bubble tea will be accessible in all the Starbucks stores at Canterbury. Starbucks will offer
Bubble tea at cafes or coffeehouses. There are also several places or distribution channels for
Bubble tea. The places to be used to influence target customers are:
 Coffeehouses/cafes
 Retailers
 Mobile apps
At the initial phase, the company will sell Bubble tea through coffeehouses. Eventually, it
will sell through online channels. The mobile applications will be used for ordering online. It
is recommended to the company to offer Bubble tea in the physical stores only as it has less
shelf life (Capon, & Go, 2016).
Promotional decisions

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The communication strategies will be used to circulate evidence about the newly launched
product i.e. Bubble tea. It can inspire customers to purchase the product. As a marketing
manager, it would suggest promoting Bubble tea through interpersonal relations and
communications. It is recommended to use advertising as an effective promotional approach.
The promotions will comprise sales promotions, advertising, public relations and word of
mouth marketing (Datta, Ailawadi, & van Heerden, 2017). The word-of-mouth marketing is
going to be providing the best customer experience to the company as evident from the
earlier products.
Integration and link
The elements of the marketing mix are integrated with each other. The product, price, and
promotional methods are the way to make the product available to the clients. The elements
of the marketing mix are intricately and delicately related to each other. When a change is
proposed to be made in any of the elements (product, price, place, and promotion) then it
opposes other elements and makes marketing mix less effective. As a marketing manager, it
will suggest managing product, place, promotion, and price in such a way that the customer
satisfaction level is much higher than the competitor companies. It has a substantial role in
the marketing planning of the product (Devia, Aisjah, & Puspaningrum, 2018).
There is a linkage between all the elements of the marketing mix as missing any of the
element cannot successfully plan the products. All the marketing mix elements are blend to
attain objectives of Starbucks. It assists in the profitable decisions of the company
(Harrington, Ottenbacher, & Fauser, 2017).
Coordination and control
The methods of controlling or coordinating marketing decisions are used to monitor the
current marketing strategies in order to attain business goals. The recommended methods of
controlling marketing decisions are:
Analysis of the competitor offerings and strategies: Starbucks is required to know about its
products by comparing with the offerings of the competitors in Canterbury. The identified
competitors are V&V Bubble Tea, Noah’s ark, Gong Cha and Hullu cat. The marketing
strategies of these companies are required to be identified before introducing Bubble tea by
Starbucks. It can be helpful to the company in retaining customers and appeal to the new one.
The competitor analysis comprises checking out new products provided by the competitor

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companies (Dorn, Messner, & Wänke, 2016). Their marketing’s strategies are evaluated in
order to know where they are succeeding or failing. This information is useful to the
Starbucks in transforming its strategy regarding the launch of Bubble tea.
Sales analysis: The sales analysis is all about the thorough study of sales performance
assumed to develop a comprehensive indulgence of the multidimensional aspects and the
complete behavioral pattern. The objective of sales analysis is to track and comprehend sales
pattern and compare it with the target decided (Ericksen, Berke, & Dixon, 2017). It even
analyses the variations and proposes the curative action warranted. The sales analysis can be
of complete sales or segmented into the regions, customers and products. The break-even
analysis can be even used to determine whether 80-20 rule executes. Both sales analysis and
break of analysis can be used to increase sales and know the reasons which can contribute to
a fall in the sales. It offers corrective guideline actions for marketing actions.

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