Marketing Strategy and Decision Making Case Study 2022

Strategy and
decision making
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Management 1
Contents
Starbucks’ strategy...........................................................................................................................2
Starbucks’ strategy...........................................................................................................................3
Starbucks’ financial performance................................................................................................3
Starbucks’ strategy fit for environments......................................................................................6
Starbucks operate in the interests of its shareholders or its stakeholders........................................7
Starbucks achieved a differentiation advantage..............................................................................8
Threats faced by Starbucks..............................................................................................................9
Ways for Starbucks to sustain outstanding performance.................................................................9
References......................................................................................................................................10

Management 2
Starbucks’ strategy
Starbucks Company is a well-known coffee, tea and spice shop that came into existence in
Seattle by College friends Gerald Baldwin and Gordon Bowker in the year 1981. In the case, this
has been found that the foremost strategy that was adopted by the Starbucks Company was
global expansion. The international expansion strategies are considered as an official, multi-level
strategic strategy that the organisations use to enter a market across the boarders for forming the
growing presence and to become profitable (Grant, 2016). In the case, the company followed the
expansion strategy for opening the different stores in the single area of the metro with the
improved local brand awareness and also provide the support to the clients so that they can visit
their stores regularly. In 1996, the company adopted the international expansion strategy with
Japan and UK in 1998 (Starbucks Corporation, 2018). The company depend on on organic
growth but with infrequent procurements.
Another strategy that is adopted by the company was Schultz’s idea of Starbucks knowledge
which is all about formation of the third-place somewhere apart home and works where the
individuals could get the opportunity to engage socially and also appreciating common
knowledge of drinking good coffee. Thus, experience of the company joint with coffee beans of
high quality, involvement of personnel, the relation of community and social purpose, design and
layout of Starbucks stores and location strategy. According to crisis of 2007-09, the strategy of
the company changes which include cancelling of the new store opening eliminated jobs and
closing 600 US stores which helped them to save the operating cost of $500 million in 2009
(Starbucks Corporation, 2018).

Management 3
The company adopted the strategy of the diversification which was essential for the proper and
successful growth. In the strategy of the diversification, the company adopts for the development
of the business (Ethiraj, Gambardella and Helfat, 2018). The company has not only brought the
diversification in their products but also its corporate model which comprise other ownership and
management arrangements, extra goods as well as the various channels of distribution.
Starbucks’ strategy
Starbucks’ financial performance
The monetary performance is considered as a subjective degree of how healthy the corporate can
make use of the assets from its main code of the business and lead to a rise in revenue. In the
case study, it has been found that Starbucks financial is continued to be robust in the initial
quarter of 2018. The revenue of the company grew by 7% (year-on-year) and with this, there is
an improvement in the operating margin which was 12.8% and it earned a return on equity of
14.0%. The financial growth of the company is clear from the data of 2010-2018 which shows
continuous improvement in revenue (Starbucks Corporation, 2018).