Analysis of Costa Coffee: Marketing Mix, Strategies & Theories

This report provides an in-depth analysis of Costa Coffee's marketing strategies, examining the marketing mix (product, price, place, promotion, people, physical evidence, and process) and its impact on the company's success. It evaluates strategic decisions, linking them to relevant marketing theories such as the Ansoff Matrix, and assesses the effectiveness of Costa Coffee's marketing efforts in increasing sales and market share. The report also highlights the importance of strategic decision-making in reducing strategic failures and competition, emphasizing the need for companies to predict future trends and adapt their strategies accordingly. It further discusses the steps involved in strategic decision-making, including defining the problem, gathering information, developing and evaluating options, choosing the best option, implementing it, and monitoring its effectiveness. The report concludes by summarizing the key findings and providing recommendations for Costa Coffee to enhance its marketing strategies and improve overall performance.

Principles and Practices
of Marketing

Contents
Contents...........................................................................................................................................2
INTRODUCTION...........................................................................................................................1
MAIN BODY..................................................................................................................................1
Marketing mix.............................................................................................................................1
Strategic decisions and relevant taught theories..........................................................................3
Effectiveness of its marketing efforts..........................................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

INTRODUCTION
Marketing can be described as activity that is considered by company for purpose of
promotion of their products and service. It helps firm to increase sales of company and also to
increase profit (Alshaikh, Maynard and Ahmad, 2021). There are different types of efforts made
by firm for purpose of increasing sales and marketing share of company. This project report
includes analysation of Costa Coffee which is UK based organisation that was introduced in the
year 1971 in UK by Bruno Costa and Sergio Costa. This project report includes evaluation of
marketing mix of company. It also includes strategic decision and different taught theories of
marketing efforts of company. Moreover, it evaluates effectiveness of marketing efforts.
MAIN BODY
Marketing mix
Marketing mix can be described as multiple areas that focus on marketing plan. It is one of
common term that includes product, price, promotion and place. It is one of marketing tool that
is used by firm for purpose of attainment of marketing objectives in target market. It is a set of
action that is taken by business in order to development of their products and market these
products to their customers (Ani and Yusoff, 2021). It assists Costa Coffee to ensure that they are
offering right products to right customers at right time, and at right place. Traditionally, this term
includes 4 p’s of marketing but at present time, marketers are using additional P’s. It is one of
important tool that helps business for various reason. It assists Costa Coffee to ensure successful
offering of products to their customers. It also allows them to ensure planning, executing and
developing different types of marketing strategies. It is important to be proactive at time when
company is facing risk and allow them to make use of their strength in order to avoid this risk. It
allows firm to understand how to promote their products that attract more and more customers
towards them.
Product: Product is somethings that is offered by company in order to satisfy needs of
their customers. Costa Coffee is a British coffee house that is suppling roasted coffee to different
caterer as well as Italian coffee shops. It is an organisation that is also offering hot as well as cold
drinks to their customers, cake, pastries sandwiches (Beede, 2020). In order to attain success in
market, it is important for company to offering differentiated products. Costa coffee has
differentiated their products on basis of quality and taste. They are offering Christmas drinks that
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is of limited edition by collaborating three brands including After Eight, Quality Street and
Terry’s. Other than this, it is also offering Costa Coffee canned coffee in order to satisfy needs of
their customers.
Price: Price of a product can be described as money value that a customer is willing to ay
for exchange of products and service. It is an important element as profit of company is
depended on it. Costa Coffee is providing high quality of products as per requirement of
customers and for this, they are charging high prices (Cull, Burton and Lam, 2020). Price of
products should be set in a manner by company that will helps them to meet the demand of
product in market. Costa Coffee is set prices in this context that helps them to meet demand of
coffee products. Demand of roasted coffee is high that allow this firm to charge high prices for
their products. At time of identifying right price for their product, firm needs to conduct
marketing research and also needs to identify various cost that is associated with products like
manufacturing, marketing and distribution.
Place: It is another component of marketing mix that is associated with distribution centre
of products and method that is used by firm to distribute products to customers. In this, focus of
firm to select a place that is easily accessible by customers. Coffee is distributing their coffee at
different coffeeshops which can be easily available for customers. Customers can visit their
coffeeshops in order to drink these. Their operation is not limited to UK but also providing their
products in all over world.
Promotion: Promotion is a method that is used by firm for purpose of gaining attention of
customers for their product. It allows firm go increase awareness of their products among
customers that will create positive impact over sales of company. There is various method of
promotion which can be adopted by firm like advertising, digital marketing, personal selling,
sponsorship, sales promotion and others (Foltean, 2019). Costa Coffee is one of organisation that
is adopting digital marketing and especially social media marketing. Social media marketing is
one of method that is used by firm for purpose of promotion of products through using social
media platforms. Customers in present time, increasingly using social media marketing that
provide opportunity for business. It allows companies to interact with customers and also solving
their problems. Costa Coffee is also using this method that allow them to interact with customers
and also create awareness among customers about their new offering, new offers and other
things.
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People: People in marketing mix include both customers as well as employees who are
directly linked with products and service. In order to get success in market, it is important for
company to target market. For this, they require right people in their organisation at right place.
It allows firm to utilise their people in efficient manner that provide the competitive advantage
(George, 2021). Costa Coffee is one of organisation that hire well skilled people in their
organisation who are ready to work with dedication and contribute to success of company. They
are providing proper training and development opportunity that also enhance skills of their
employees. Costa Coffee is also providing proper salary and other facilities to their employees
that increase their satisfaction and allow employees to give their bet for attainment of goals of
company.
Physical Evidence: It can be described as evidence to customers for consuming products
and service it can be done through branding, packaging, physical environment at time of selling
of products and service. Costa Coffee is one of organisation that is offering different types
products to their customers. They are providing their coffee in a glass that is physical evidence of
their customers. They are also offering their coffee in customer friendly environment that
enhance their experience. It is one of important aspect that allow firm to get evidence of products
to customers. This physical aspect that is linked to products and service will enhance values of
products and service of company.
Process: Process play important role for building and delivering good quality of products and
service to customers. In this, it is important for managers of company to ensure that their process
is free from not required expenses. In this, firm needs to understand where they need to make
improvement in their process. Costa Coffee is providing effective customers service at time
when customers are visiting to their coffee shop (Hockenberry, 2019). It is important in order to
enhance experience of customers and also to ensure their revisit in their company. They are also
asking for feedback from customers that is important for company to improve their process. It is
essential in order to develop good position of company in minds of customers. Managers of
Costa Coffee also review their process in order to ensure that there is no wastage of resources,
time and efforts of people and make necessary improvement when required. It is important for
them to be an effective organisation and to reduce cost.
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Strategic decisions and relevant taught theories
Strategic decision making can be described as process in which charting of a course can be
don that is based on longer vision and long-term goals. With clarification of picture of company.
A person get opportunity to along their plan with mission of company and also create operation
consistency and clarity. It provides opportunity to business to select best path that provide them
opportunity for success. There are different types of factors to be included in this like target
market, time and cost. It also provides opportunity to company that allow them to formulate a
action plan also allow them to align their goals with true picture of company.
There are various choices available for company to choose in day-to-day operation but strategic
decision making is different for it. For instance, managers of Costa Coffee need to delegate
different roles and also needs to communicate goals of company with members of team as well
as other stakeholders (Islam, 2018). They also need to face uncertainty occur in an organisation
and needs to make decision in order to overcome of it. Decision making by manager of Costa
Coffee not does not only affect employees and manager but also whole organisation. It is
essential for managers of Costa Coffee to ensure strategic decision making in their organisation
as it allows them to earn things and also to improve performance of organisation. It is important
in order to reduce probability of strategic failure as well as competition. It is important for firm
to predict future trends.
Strategic decision making is one of important process that is important for firm. It includes
various steps that is consider by firm in order to overcome of problems occur in business. In
order to develop strategic decision making, managers of Costa Coffee need to consider various
steps which are mentioned below:
Define the problem: it is one of first step that is consider by managers of Costa Coffee in
which they are identifying problem occur in their organisation that is important for them. Costa
Coffee is facing problems related to reduction of sales of company.
Gathering of information: it is another stage in which focus of organisation is to gather
information related to problem. This information can be gathered through communicating to
different stakeholders like shareholder, customers, employees, suppliers and other people of
company (Köse, Argan and Hedlund, 2020). Information can also be gathered by managers of
Costa Coffee through conduction research and development.
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Development and evaluation of options: After gathering of information, managers of
Costa coffee can develop different options for solving problem occur in organisation. For this,
they can ask for suggestion from employees, customers. It will also help them for getting new
ideas that is important for organisation. After this, manager also needs to evaluate different
operation in order to select option that best suits to their requirement.
Choose best operation and implement: In this step, after evaluation different operation,
managers of Costa Coffee need to adopt best option that suits to their requirement. It is important
for purpose of implementing best operation in their organisation (Mattera and Ruiz-Morales,
2020.). In order to implement strategic decision, manager of Costa Coffee needs to get
acceptance of all members as they can create impact over operation of company.
Monitoring: It is another stage in which after implementing decision, managers of Costa
Coffee need to monitor that their strategy is effectively working in company or not. If problems
occur in this, they need to make improvement that will ensure success of strategic decision.
Marketing theories:
Ansoff Matrix: Ansoff matrix is one of tool that is used by companies in order to plan and
analyse different strategies in order to get growth. There are four strategies included in this that
is used by firm in order to get growth and also to analyse risk linked with different strategies.
This model was introduced by H. Igor Ansoff in the year 1957. These strategies can be sued by
managers of Costa Coffee can be mentioned below:
Market penetration: It is a strategy that is important for firm to use their new product in
existing market. It allows firm to increase their marketing share with existing products in
existing market. For this, they are adopting new tactics like decreasing prices of products to
attract new customers, increasing promotional efforts of firm to attract more customers.
Product Development: It is a strategy that is used by firm in order to develop new products into
existing market (Pravdova and Imrecze, 2020). For this, managers of company need to conduct
market research and development and also provide them opportunity to expand product range of
company. It is strategy that allow firm to develop strong understanding of current market and
also assist them to develop innovative solution.
Market development: It is another strategy that can be adopted by managers of Costa
Coffee in which firm enter in new market for their existing products. It allows firm to expand
their marketing into new geographic region or in new customer segments. It is a strategy that an
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be successful in market if firm has new technology and also allow customer to expand their
operation in new market.
Diversification: It is a strategy that allow firm to enter into new market with new
product. It is a strategy that contain high risk as in this both market as well as product are new. In
this, risk can be mitigated by firm through diversification of products. It is also a strategy that is
important for firm as it allow them to increase profit of firm.
Porters generic strategies: It is another marketing model that is adopted by managers of Costa
Coffee. It is a model that was introduced by Michel E. Porter in the year 1985 that provide
competitive advantage to firm (Purushottam, Rwelamila and Ncube, 2021). It is a model that
consist mainly three strategies including cost leadership, differentiation, focus strategies.
Explanation of this strategy in context of Costa Coffee is mentioned below:
Cost Leadership strategy: It is a strategy which is adopted by firm in order to get
competitive advantage. It is aiming for development of competitive edge for firm and also assist
them to overcome of competitors. It allow firm to increase profit with aim of reducing cost of
company that provide them opportunity to increase their marketing share.
Differentiation strategy: it is another strategy in which firm can adopt differentiating
with adoption of new technology or making changes in their offering. It also provides
opportunity to managers of Costa Coffee to get competitive advantage.
Focus strategy: It is another strategy which is focusing on both through differentiation as
well as reduction of cost of firm. It can be adopted by managers of Costa Coffee that is adopted
by them for purpose of getting competitive advantage.
Effectiveness of its marketing efforts
Marketing efforts are made by company in order to develop good positioning of their products in
market. Companies are also making these efforts for purpose of increasing awareness of products
and service that is essential in order to increase sales of their products and service. Managers of
Costa Coffee is making efforts in organisation for purpose of promotion of products and service
that is important for them (Rishi and Kuthuru, 2021). In order to evaluate these efforts, there are
different ways which can be adopted by managers of Costa Coffee. These methods include return
of investment, increase in sales of products, marketing reach expansion and other methods.
Explanation of these efforts is mentioned below:
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Return on investment: It is a one of method through which marketing efforts can be
evaluated by firm. Return of investment is one of important concern for company in order to
overcome of expenses. Companies are making marketing efforts for purpose of earning profit
that is essential for business. For this, it is important for companies to measure the money spend
on different marketing campaign and other efforts against sales of company. It allows them to
identify right return on investment of company that is important for a business to analyse profit
of firm.
Marketing reach expansion: Marketing reach is another method that assist to ensure
effectiveness of marketing effort. It is important for purpose of expansion of market of firm. It
allows managers of Costa Coffee to expand their operation new region through customer
recommendation or another other way and make their product successful (Ruiz and Lluesma,
2018). It can also be done through getting support of products of company from customers.
Customer response: It is another method that is taking different forms that assist firm to
evaluate effective of marketing efforts. In this, managers of Costa Coffee can take feedback from
customers click rate, online engagement that allow them to reveal performance of company.
There are different metrics that is used in order to evaluate effectiveness of plan. It assists them
for promotion of right vehicle that is important in order to select right audience and also assist
them to be accurate. Online efforts provide opportunity to company to get customer response. It
is important for them to expand their operation and also to increase effectiveness of marketing
plan.
Sales performance: It is also an indicator of growth and success of marketing efforts. Managers
of Costa Coffee can evaluate effectiveness through this method. Increasing sales of company
allow them opportunity to increase more profit (Shaikh and Kazmi, 2021). It indicates positive
sign for marketing efforts of company and also allow them to attain their organisational goals. In
this, company needs to consider that change in sales can take place through changes in prices.
CONCLUSION
From above mentioned project report, it can be concluded that marketing is one of important
activities that is adopted by firm in order to increase marketing share of company and also to
attract more customers towards them. Marketing mix is a tool that is adopted by firm and include
main components of marketing including product, price, place, promotion. It is also considering
additional P’s of marketing like people, process and physical evidence. There are various
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strategic decision making in firm which helps them to overcome of problems For this, managers
also adopted different marketing model like porters generic strategies, Ansoff matrix and others.
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