Marketing and Management Australia Report 2022

Running Head: MARKETING & MANAGEMENT
MARKETING & MANAGEMENT
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Executive summary
Starbucks is considered to be one of the leading coffee brewer in World with its diverse coffee
and related items and quality service mechanism. However, in Australia the rich coffee culture
compels Starbucks to prepare better market segmentation so that the products will be infused
with great value on the customers. In this regard, the Brewed Coffee is definitely identified as an
important product that can help Starbucks to deliver better organisational practice. Fighting
against obesity is a significant facet of Brewed Coffee and utilising it will properly help
Starbucks to establish its market extensively in Australia. Therefore, this report aims to the target
market and customer segmentation of Starbucks to expand market in Australia effectively.

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Table of Contents
Introduction......................................................................................................................................2
Background......................................................................................................................................2
Market Analysis...............................................................................................................................3
Product.........................................................................................................................................3
Price.............................................................................................................................................3
Place.............................................................................................................................................4
Promotion....................................................................................................................................4
Process.........................................................................................................................................5
People..........................................................................................................................................5
Physical evidence.........................................................................................................................5
Market Segmentation.......................................................................................................................6
Geographic...................................................................................................................................6
Demographic................................................................................................................................6
Behavioural..................................................................................................................................7
Psychographic..............................................................................................................................7
Target Market Recommendation.....................................................................................................7
Conclusion...................................................................................................................................8
References......................................................................................................................................10

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Introduction
Target market is considered to be one of the useful tool for the business organisations
irrespective of its size and operation. The notion and purpose of target market is associated with
the marketing communication strategies (Tkaczynski, Gill & Van Winkle, 2019). In other words,
it can be stated that target market of a company is responsible to determine the target customers
and allows the organisation to set its marketing strategies based on the target market. Apart from
that evaluating the potential and the reaching to the right audience are also identified as
important aspect that the target market practice is facilitated for the benefit of the organisation
(Thao & Duong, 2019). This report aims to develop a market segmentation of Starbucks
Australia and recommends the target market so that the organisation can generate a strong and
competitive marketing strategy. However, before addressing the target market, the report focuses
on the market trends so that the recommendations are justified.
Background
Starbucks is considered to be one of the leading coffeehouse chain in America. The
company was established in 1971 and gradually encapsulate the global market with a rigorous
measure. From the global perspective Starbucks has over 30,000 locations all over the world
(starbucks.com.au, 2019). The company is popular for its wide range of products from coffee
beverages and smoothies to tea, baked goods and sandwiches. The popularity and the image of
Starbucks have enough value that helps the company to get strategic advantage in the
international business. In this context, one of the popular product of Starbucks is its Brewed
Coffee. The reason behind the popularity of this coffee brand is its healthy value. As a matter of

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fact, one of the major health issues in Australia is related to the obesity. According to the report
of the Bureau of Statistics, Australia, a national health survey was conducted in 2017-18 that
represented almost two third of the Australian adults with a percentage of 67 or 12.5 million
Australians are suffered with obesity (health.gov.au., 2019). The rate of obesity was also
increased from the previous year of 2014-15. Australian children are also part of the obesity
problem with almost one quarter of the child population in Australia. It means 24.9% of the
Children aged 5-17 years are suffering with the obesity disease (health.gov.au., 2019).
Henceforth, the Brewed Coffee claims to be good for the people suffered with obesity.
Market Analysis
Product
Starbucks is popular for its coffee and related beverages. In this regard, the Brewed
Coffee has its own popularity because of taste and health benefits. Based on the research of Fan,
Lau and Zhao (2015) it can be stated that the unique value of the product generates a great deal
of customer appreciation and acceptance that resulted in high profitability. In this regard, the
regional variation and uniqueness of the product is also a significant facet that coincides with the
local demands. Based on this understanding, it can be argued that the Brewed Coffee of
Starbucks is definitely leaves a great deal of impact on the Australian life due to its health
benefits and fight against obesity. The Brewed Coffee of Starbucks is available in 4 sizes like the
short with 237ml, tall for 354ml, Grande with 473ml, Venti with 591ml (starbucks.com.au,
2019).

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Price
Pricing strategy is also an important aspect for the Starbucks management in order to
bring more and more customers into the organisational development. Therefore, a wide price
range has been set for different types of customers so that everyone can buy the Brewed Coffee
of Starbucks as per their needs and pocket. The short Brewed Coffee is worth of $2.90 whereas
the tall Brewed Coffee price is $3.20, Grande coffee worth $3.50 and the Venti prices $3.80
(investor.starbucks.com, 2019). In an overall analysis, the price of the Brewed Coffee of
Starbucks ranges from $3 to $4 which is considered to be highly cheap and worthy.
Place
Starbucks Australia offers more than just finest coffee to the Australian people. In
addition to this, using its good attitude towards the people and fostering a good environment are
also identified as crucial for the business of Starbucks in Australia (Datta, Ailawadi & Van
Heerde, 2017). The head office for Starbucks, Australia is located at Richmond, Victoria.
However, there are more than 80 Starbucks stores in Australia that enables an effective measure
for the organisation to maximise its customers. Most of those stores have a unique environment
so that the customers and visitors will get adequate satisfaction and pleasure to visit the stores.
Promotion
There are several unique and strategic measures that the Starbucks management has
followed with the sole purpose to create a brand value and maximising customers. Therefore, a
My Starbucks Idea program was designed and it collects suggestions and feedback from the
customers (starbucks.com.au., 2019). The motive behind this practice is to engagement the
customers more into the organisational activities of Starbucks. Promotional offers like Happy
hour time or couple offer are also incorporated into the Starbucks operation in order to bring

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more customers. Quality of products is also played a pivotal role for Starbucks so that it will
provide an assurance to the customers. It also helps to build a better promotional measure for
Starbucks.
Process
In most of the cases, Starbucks operates in a joint venture and licensing agreements. For
instance, in the international business Starbucks follows the licensing operations practice that
will help the partners as well (Harrington, Ottenbacher & Fauser, 2017). Moreover, the licensing
is also effective for the new ventures where they can get the licensing application online and the
type of operation is also helpful in order to bring get a transparency in licensing. Apart from that
the company also has licensed retail stores, food service accounts and other projects that are
incorporated into the main business strategy of Starbucks. In fact, a community website is also
designed by Starbucks for collecting suggestions and feedback from the customers.
People
The employees of Starbucks Australia are highly skilled in service so that it will provide
a quality service offerings to the customers. The intention of the organisation is to set adequate
measure to the quality of products and services and employees are played the pivotal part in
order to meet the objectives of the organisation (Taecharungroj, 2017). Starbucks also interests
in focusing on the training and development of the employees to gain strategic advantage from
the employee training skills. The senior management is also focused with rapt attention to the
performance of the employees and ensures the effective operations of the organisation.

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Physical evidence
The Starbucks management posed a great deal of importance on the transparency of
importance. As a result of that information regarding products, business partnerships and career
opportunities are placed on its official websites. Moreover, the value of the Starbucks logo is
largely popularised among customers and creates an international image of Starbucks. There are
several stories regarding the logo of Starbucks and it helps Starbucks to gain popularity among
the people even only using the logo rather than the name (Bui, Nguyen & Pham, 2017). Besides
this, focusing on the store atmosphere and makes it more positive through the use of lights and
colours also help Starbucks to attract more customers.
Market Segmentation
The market segmentation for Starbucks is considered to be an important aspect to
address. The specific product named Brewed Coffee requires a close attention to the target
customers. Therefore the value of the product cannot be worthy if it does not have proper market
segmentation. Therefore, four types of customer segmentation is important for Starbucks for the
brewed Coffee product.
Geographic
As far as the geographic segmentation is concerned, most of the Starbucks stores are
placed in the urban cities of Australia. Sydney, Melbourne, Brisbane and Gold Coast are the
important places or region where Starbucks has placed all its stores in Australia (Li, 2018). One
of the reason behind such motive is to maximise the customers and get involved with the urban
lifestyles. Moreover, the operation and organisational activities of Starbucks suits the urban

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lifestyles. Therefore, it becomes essential for the organisation to open stores in the urban cities
where population is high with high density.
Demographic
Most of the Starbucks customers are within the age of 20 to 60. It means adults are
primarily the target customers for Starbucks. However, there is no such gender biasness that
Starbucks follows. Henceforth, both male and female customers are always welcome in
Starbucks Australia stores. Most of the people are married and professionals. In addition to this,
there are bachelor young people who often visit the Starbucks stores. Apart from that Starbucks
stores are common hotspot for newly married couple, families and children from the age of 7 to
19. In this regard, it can be stated that a wide range of people with different occupation are often
visit the Starbucks stores. Most of these people are students, employees or professionals
(Brotspies & Weinstein, 2019).
Behavioural
Easy going and ambitious people are the regular customers of Starbucks, Australia. In
addition to this, regular users with a behavioural feature of hard core loyals are also contributed
to the strong customer base of Starbucks Australia. Most of the visitors are willing to enjoy
quality coffee in a relaxing atmosphere with a place to chat and spend healthy time with the
friend and families. It is important to understand that all those people have a steady family life or
social life that help them to spend ample time with family and friends (Voigt, Buliga & Michl,
2017). As a result of that it becomes important for Starbucks to create a healthy environment.

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Psychographic
People belong to the middle and high class are considered to be the target customers for
Starbucks because the pricing strategy of the coffee company only supports the income of the
middle and upper class people. Apart from that there are mainstreamer and aspirer who are
visited the Starbucks stores in a regular manner.
Target Market Recommendation
Target market is referred as an important and valuable part for the success of a company
and set the effectiveness to ensure the customer base properly. In this regard, Starbucks has a
close and reputable relationship with its customers that add more strengths to the operations and
business success to the organisation. In this regard, there are some recommendations for the
target market setting of Starbucks, Australia. For instance,
 The target market should incorporate the teenagers and the children within the core
customer segments. One of the reason behind such measure is the health benefit of the
Brewed Coffee which is effectively fighting against the obesity related issues. As per the
government increasing trend of obesity among the children and adults can dismantle the
life expectancy rate of the Australians. As a result of that it becomes a great opportunity
for Starbucks to using obesity as a promotional tool to get more customers who are
suffering with obesity problems. Moreover, it will also help the organisation to strengthen
its brand image.
 Besides this, reconsidering the price range with middle and upper class people will also
help Starbucks to establish a benevolent business practice. The purpose of the
organisation is to maximise its customers and accompanying the lower class people also

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help to increase the number of customers and also shape the organisational value to
incorporate the local customers irrespective of their income and financial stability.
Conclusion
The Above discussion is trying to put a great deal of emphasis on the customer
segmentation and target market of Starbucks. For this, a market analysis and operational
practices of Starbucks are examined properly that highlights the interest of the coffee and
beverage company to facilitate better and quality services and products for the Australian people.
The market competitiveness is also a crucial factor that compels Starbucks to take adequate
measures for maximising its customers. Henceforth, the Brewed Coffee of Starbucks seems to
have the ability to develop a strong image and brand value of the organisation by combating with
obesity. This is a grave problem for the Australians and Starbucks should vest more interests on
this. Therefore, it can be concluded that this report rightly puts emphasis on sustainable business
practice in reference to set a target market relevant with offering Brewed Coffee.

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References
Brotspies, H., & Weinstein, A. (2019). Rethinking business segmentation: a conceptual model
and strategic insights. Journal of Strategic Marketing, 27(2), 164-176.
Bui, T. Q., Nguyen, H. V., & Pham, N. T. (2017). The Effects of Selected Marketing Mix
Elements on Customer-Based Brand Equity: The Case of Coffee Chains in
Vietnam. PRIMA: Practices & Research in Marketing, 8(1).
Datta, H., Ailawadi, K. L., & Van Heerde, H. J. (2017). How well does consumer-based brand
equity align with sales-based brand equity and marketing-mix response?. Journal of
Marketing, 81(3), 1-20.
Fan, S., Lau, R. Y., & Zhao, J. L. (2015). Demystifying big data analytics for business
intelligence through the lens of marketing mix. Big Data Research, 2(1), 28-32.
Harrington, R. J., Ottenbacher, M. C., & Fauser, S. (2017). QSR brand value: Marketing mix
dimensions among McDonald’s, KFC, Burger King, Subway and
Starbucks. International Journal of Contemporary Hospitality Management, 29(1), 551-
570.
health.gov.au. (2019). Department of Health | Overweight and Obesity. Retrieved 30 July 2019,
from https://www1.health.gov.au/internet/main/publishing.nsf/Content/Overweight-and-
Obesity
investor.starbucks.com. (2019). Annual Report-2018. Retrieved 30 July 2019, from
https://investor.starbucks.com/financial-data/annual-reports/default.aspx

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Li, C. Y. (2018). Consumer behavior in switching between membership cards and mobile
applications: The case of Starbucks. Computers in Human Behavior, 84, 171-184.
starbucks.com.au. (2019). Brewed Coffee | Starbucks Coffee Australia. Retrieved 30 July 2019,
from https://www.starbucks.com.au/menu/30/brewed-coffee
starbucks.com.au. (2019). Coffeehouse | Starbucks Coffee Australia. Retrieved 30 July 2019,
from https://www.starbucks.com.au/Coffeehouse.php
Taecharungroj, V. (2017). Starbucks’ marketing communications strategy on Twitter. Journal of
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Thao, N. X., & Duong, T. T. T. (2019). Selecting target market by similar measures in interval
intuitionistic fuzzy set. Technological and Economic Development of Economy, 1-17.
Tkaczynski, A., Gill, C., & Van Winkle, C. M. (2019). Target Marketing of Small-Scale Festival
Attendees: A Scoping Study. Event Management, 23(3), 483-490.
Voigt, K. I., Buliga, O., & Michl, K. (2017). Globalizing Coffee Culture: The Case of Starbucks.
In Business Model Pioneers(pp. 41-53). Springer, Cham.