Case Study: Marketing Plan for Starbucks in Australia (Perth Launch)

This case study provides a detailed marketing plan analysis for Starbucks' expansion into the Australian market, specifically focusing on its launch in Perth. The study begins with an executive summary and then delves into a situational analysis, utilizing PESTLE and SWOT frameworks to assess the political, economic, social, technological, environmental, and legal factors, as well as the company's internal strengths and weaknesses alongside external opportunities and threats. A thorough market analysis is conducted, examining the competitive landscape, coffee consumption trends, and consumer preferences in Perth. The study outlines Starbucks' mission, objectives, and segmentation, targeting, and positioning strategies. Furthermore, it explores the marketing mix, including product, price, place, and promotion tactics, alongside specific actions and strategies to achieve its objectives. The conclusion summarizes the key findings and provides recommendations for Starbucks to succeed in the Australian market. The study references various academic sources to support its analysis and recommendations.

Marketing Plan
Case Study of Starbucks Australia

Executive Summary
Starbucks is one of the leading coffee chain companies in the world. It is spread over number of locations
in the world and has gained huge success. However, in Australia Starbucks has not been able to succeed
and hence this stands to be an extremely important aspect of analysing its business strategy. Marketing is
an extremely important aspect for a business especially when expanding a business in a new market.
Starbucks as an organisation planned to launch a new outlet in Perth, Western Australia. The consumers
in Perth have European coffee culture and the organisation needs to understand the taste and preference
effectively. From the market analysis it has been found out that consumers are looking for new products
and is willing to experiment. The immediate competitors of Starbucks in Perth are McCafe, Costa Coffee,
et cetera. The marketing mix of the organisation has been implemented effectively to focus on
concentration and premium pricing for the targeted market between the age group of 18-55. The study has
focused on analysing the marketing strategy which has helped to address the objectives.

Table of Contents
Executive Summary.....................................................................................................................................2
Introduction.................................................................................................................................................4
Situational Analysis of Starbucks................................................................................................................5
PESTLE Analysis....................................................................................................................................5
SWOT Analysis.......................................................................................................................................6
Market Analysis..........................................................................................................................................8
Mission, and Objectives of Starbucks..........................................................................................................9
Segmentation, Targeting and Positioning....................................................................................................9
Marketing Mix of Starbucks......................................................................................................................10
Tactics and Actions...................................................................................................................................12
Conclusion.................................................................................................................................................12
References.................................................................................................................................................13

Introduction
Success of a business stands on the effective strategic marketing. Marketing stands to be
extremely important for an organisation because it not only helps the organisation to reach its
target audience in the market but also helps to analyse the market in the best possible manner for
effective sustainability in the market. In a highly competitive business environment, marketing
stands to be the differentiating factor. All the top multinationals in the world have focused on
their marketing strategy which has helped them to develop a strong hold over the market that in
return increased the market share of these organisations. Starbucks is one of the leading coffee
chain organisations in the world which has gained worldwide popularity for its excellent
products and services but the organisation has largely failed in its first attempt to get into the
Australian market. The organisation doesn’t have effective presence in the Australian market
which clearly shows the amount of competition the company will have to face once it launches in
certain locations of the country. This is where the importance of marketing plan comes into the
picture (Goworek, McGoldrick and McGoldrick, 2015). The present study would focus on
discussing the key aspects of marketing plan with reference to Starbucks launching an outlet in
Perth where the coffee culture is tad different as compared to the other places in Australia.

Situational Analysis of Starbucks
Situational analysis is an extremely important tool for an organisation that is looking to expand
its business in a new market. It cannot be denied that analysing the market is important before
expansion but before analysing the market it is important for an organisation to understand the
core strengths and weaknesses and opportunities and threats so that the organisation could
effectively develop a strong strategy. Understanding internal and external environment of an
organisation is extremely important (Baker, 2016). Expanding its business in a new market like
Perth could be tough if Starbucks is not able to understand its business environment properly.
Tools like PESTLE and SWOT helps to do that effectively. In the present case analysing the
PESTLE factors would help the organisation to further develop its goals and objectives in
Australia.
PESTLE Analysis
Political: Australia is a politically stable country. The country is open to foreign companies
operating in this market. New business policies especially for foreign organisations have
changed to some extent where the foreign organisations do receive significant leverage which
helps foreign companies to sustain in the market.
Economic: Economic factors are extremely important to be analysed and understood for an
organisation before launching an outlet in Perth. One of the major problems that presently loom
over Australia and over its major cities like Perth is the economic policies set by the current
government. After the Great Depression which affected almost all the countries in the world has
had significant impact on Australia too. The economy since then has more or less recovered but
problems like inflation has led people to spend less even though they have ability to spend. The
unequal distribution of wealth in the country has increased the rift between the rich and the poor
which is also an important aspect to be kept in mind (Lamb et al., 2015).
Social: In the last few decades Education is considered as one of the major aspects in Australia.
The government takes significant interest on education and invites different companies to
contribute to the development of education in the country. Australia’s population is ageing and
this largely affects the workforce because getting quality and skilled employees become tough
and hence Starbucks have to keep this mind as well. Apart from that talking specifically about

Perth the social culture of Perth that is Western Australia is largely like European culture which
also reflects on the coffee culture of this place.
Technological: From the point of view of technology this country is quite forward and Starbucks
as an organisation has been effective in constantly changing its IT strategy. It is important for the
organisation to be consistent enough to keep with the technological needs and wants of the
consumers (Atwal and Williams,2017).
Environmental: Australia is a country that is known for its varied range of flora and fauna. It
focuses on the indigenous areas of the country and hence as an organisation Starbucks has to be
focused on contributing to the overall development of the environment. Starbucks have set
benchmarks in terms of carbon emission reduction and developing green management strategy in
business which sets them up for a challenge in the new location.
Legal: There are certain key aspects that organisations operating in Australia have to abide by.
The employment laws and operating rules and principles have to be conformed with in order to
avoid any kind of legal implications.
From the present analysis it is extremely important for Starbucks to understand the social and
economic issues in Australia which would help to develop a strong marketing strategy for the
organisation (Lamb et al., 2015).
SWOT Analysis
Analysing strengths, weaknesses, opportunities and threats needs to be effectively analysed by
the organisation in order to encash on the strengths and improve the loopholes to meet the
weaknesses. The opportunities would help to expand the business and gain overall sustainability
in the market.
Strengths
 Excellent brand image.
 Great market presence.
 Strong capital structure.
 Strongest franchise in the world with highest number of licensed shops.

Weaknesses
 One of the biggest weaknesses of the organisation is the costliness of the products.
 Failed to explore Australian markets properly.
 Weaker online strategy.
 Staff issues.
 Higher dependence on the domestic market (Kotler and Armstrong, 2018).
Opportunities
 Expansion opportunities in countries like Australia.
 Better product strategy and business focus.
 Diversification.
 Improving online business.
Threats
 Increasing global competition.
 Global economic crisis affects purchasing power of consumers.
 Emerging coffee chain organisations.
 Increasing dependence on the online market by most organisations (Morden,2016).
From the present analysis it is clear that the organisation needs to work on number of aspects to
be successful in Australia again. It has to not only understand the taste and preference of the
consumers, but also strengthen its overall strategy especially to expand its business in the foreign
markets.
Market Analysis
Market analysis is extremely important for an organisation to understand the competition in the
market. Australia is a vast country with different kinds of people all across. Coffee is a popular
beverage and widely drank beverage which clearly shows that the market is likely to be highly

competitive. The café and coffee shop industry in Australia has grown moderately in the last five
years. The industry revenue has grown as well which clearly shows that most of the coffee chain
companies have encashed on this growing interest to drink coffee. Australia is a nation of coffee
drinkers (McDonald and Wilson, 2016).
Fig 1: Coffee Drinkers in Australia (Kotler and Armstrong, 2018)
In the last five years Coffee sales were up by 80% which is a great movement and a positive
indication for all the coffee chain organisations operating in the country. In the earlier times
Starbucks could have easily penetrated the market but with the increasing competition and new
players coming in the market the competition is high and existing rivalry has also increased.
Companies like Costa Coffee, McCafe, Dunkin Donuts and Caffé Ritazza have high market
share in Australia. Since the target market of the organisation is Perth at the present moment a
short survey was conducted based on the taste and preference of the consumers with reference to
coffee which showed that the consumers are looking to try new things with European touch on it.
Coffee republic is another major candidate operating in the market against Starbucks which have
to be effectively managed by the organisation at this new venue (David, David and David, 2017).
Hence, it is clear that the consumers have many options in the market which makes it mandatory
for the organisation to offer better and effective for the consumers to sustain in the market for a
long period of time.

Mission, and Objectives of Starbucks
The present mission of Starbucks is to “become the “go to” coffee shop for people in Perth”. The
mission has been strategically developed by the organisation as it would help to focus on
addressing all the key aspects of competition in the market. It is essential for an organisation like
Starbucks to be able to compete in a market which would help the organisation to sustain in the
market for a long time. The main focus of the organisation is to create the awareness of the brand
in the market. It is a renowned brand but consumers in Perth are focused on assessing the quality
of the product and service as well which ultimately helps to decide on which brand to pick
(Armstrong et al., 2014).
Based on the above mission the organisation has framed relevant objectives which are discussed
below:
 To launch six more outlets across Western Australia by the end of 2019.
 To recruit around 50 employees for these restaurants by the end of November 2019.
 To achieve the 5million mark in terms of revenue by the end of 2020.
 To develop a strong online portal for Western Australia by the mid of 2020.
Segmentation, Targeting and Positioning
Segmentation, Targeting and positioning stands to be extremely important tools that underpin the
marketing plan effectively. Segmentation is a strategy which helps to identify the relevant
customer base for an organisation based on certain key aspects like demographics,
psychographics et cetera. Analysing the target segment is important to understand their needs
and wants and the taste and preference in the best possible manner. In the present case Starbucks
segments its market based on age, income et cetera. It also focuses on psychographics like
lifestyle choices. Hence, the target age group of the organisation is 18 to 55 who have higher
income and are able to afford the same. The organisation has changed its demographics to fit in
the needs of the people in the most effective manner (Kotler et al., 2014).
The target market involves youths, middle aged people. The targeting is done in a concentrated
manner which helps the organisation to present youths and middle aged customers with higher
options. The youths want lively product choices whereas the middle aged ones want to stick to
their brands and do not want to experiment. Hence the organisation has targeted its people and

developed its products in such a way that helps to meet the needs and wants of both these classes
(Burns, Bush and Sinha, 2014).
Positioning is done in a focused manner which helps to position the organisation effectively. The
organisation serves high class consumers which are its primary target and hence the products
have to have luxury features that provide sense of superiority. Hence Starbucks provides high
value proposition for both the targeted age group youths and adults. When the adults get high
value proposition through hygiene and quality products then youths get high value proposition
through price and varied product range (Brunswick, 2014).
Fig 2: Brand Positioning Starbucks (Kotler and Armstrong, 2018)
Marketing Mix of Starbucks
Marketing mix consists of product, place, promotion and price which are important for the
organisation to take into account.
Product: Starbucks core product is coffee. The organisation is the largest coffee chain company
in the world. The augmented product that Starbucks offers is the design of the cups and the way
the products are presented. It is important for the organisation to have effective European
approach towards the development of the product which would help the organisation to create a
loyal customer base (Kotler and Armstrong, 2018).

Price: The organisation will follow the premium pricing strategy which would help to increase
the self satisfaction of the consumers who come in the outlets. It also helps to continue its brand
positioning which is effective to draw targeted audience in the market. The premium pricing will
provide a separate importance to the organisation in terms of its class and quality (Lamb et al.,
2015).
Promotion: The organisation will follow the promotional mix strategy where it focuses on
reaching clients directly through direct marketing, online marketing through social media,
websites and open forums. Apart from that it offers customised choices which would help
consumers to get their preferences properly and finally with discounts and freebies every time
consumers use Starbucks services. The organisation has planned to introduce loyalty cards which
would help to get different offers and notifications about the organisation and its products across
the targeted regions (Morden, 2016).
Place: It is an important part of marketing mix. The organisation opens its outlets in posh and
well connected regions which helps the consumers to get access to the services effectively. Apart
from that Starbucks also has third party distribution tie-ups for online order delivery and meeting
the consumer needs through the online platform. It develops excellent visual merchandising
through decorations and furnishing the outlets in the best possible manner (David, David and
David, 2017).
Tactics and Actions
The organisation will implement all round web-marketing approach as well through social media
and website marketing which would help to develop excellent bonding with the consumers. This
will also enhance the consumer communication and help to meet the consumer expectations
properly.

The organisation has developed a ten staff panel to meet the marketing needs of the company to
launch its outlets in Perth, Western Australia. The marketing plan would be analysed at regular
interval and would be changed if needed based on the results of the marketing process applied
(Lamb et al., 2015).
Conclusion
Marketing planning is an extremely important tool for an organisation to either expand or launch
a new product. The present study has discussed the key aspects of marketing process attached
with the launch of a new outlet in Perth.
References
Armstrong, G., Adam, S., Denize, S. and Kotler, P., 2014. Principles of marketing. Pearson
Australia.
Atwal, G. and Williams, A., 2017. Luxury brand marketing–the experience is everything!.
In Advances in luxury brand management (pp. 43-57). Palgrave Macmillan, Cham.