Marketing Plan: Starbucks' Strategies in Australian Market - MKT600

This report provides a comprehensive marketing plan for Starbucks, focusing on its Australian operations. It begins with an executive summary and an introduction to Starbucks, the world's largest coffee chain. The report then delves into the company's marketing strategy, including market segmentation (demographic and psychological), targeting (high-end consumers), and positioning (high price, high quality). It presents a positioning map and details the value proposition, focusing on coffee quality, customer intimacy, and store atmosphere. A thorough analysis of the 7Ps of the marketing mix (product, place, promotion, price, process, people, and physical evidence) is provided. The report also includes budget considerations, control measures, recommendations for future growth (e.g., expanding the menu to include beer), and a conclusion summarizing the key findings. The report emphasizes the importance of training employees and adapting to the market. The report also addresses the challenges faced by Starbucks in the Australian market, including the closure of stores in 2008, and explores strategies for regaining market share. The report is concluded with references.

MARKETING PLAN
STUDENT DETAILS

Marketing Plan 1
Executive Summary
Selected company for this assignment is “Starbucks”. In this assignment, various part
related to the marketing strategy of this company will be discussed. Marketing plan of the
company includes their segmentation, targeted market, positioning map, value proposition,
7p’s of marketing mix, budget and controls. High-end consumers are the targeted audience of
the company because they offer premium class services and satisfy their customers need
which includes atmosphere, connectivity of electricity and Wi-Fi, customer hospitality, etc.
As compare to its competitors they charge premium prices for their products. Positioning map
shows that the company stand on high price and quality axis. The brand is counted among the
most successful coffee brand around the globe but they had face huge loss in Australia. They
had to shut down stores in the year 2008. Still, they are making efforts by opening new stores
on convenient locations. Starbucks uses premium price strategy to fascinate their customers
and they also sell various mechanized. To enhance their market size in Australia they can also
add beer in their menu. Management should keep their employees in training period for long
time to help them in understanding deeply about the coffee making and customer hospitality.

Marketing Plan 2
Contents
Introduction................................................................................................................................3
Segmentation..............................................................................................................................4
Positioning Map.........................................................................................................................5
Value Proposition.......................................................................................................................6
Marketing Mix...........................................................................................................................9
Budget......................................................................................................................................12
Controls....................................................................................................................................13
Recommendations....................................................................................................................14
Conclusion................................................................................................................................15
References................................................................................................................................16

Marketing Plan 3
Introduction
The marketing plan is the report which provides a framework for the business that
outlines the marketing strategy for the company. It is the plan which outlines the marketing-
related strategies of the company and it includes the description of current marketing
strategies pursued by the company, timeline for completing the task, key performance
indicators and description of business’s targeted market and audience. Selected company for
this assignment is "Starbucks". Starbucks is an American coffee company and it is the largest
coffee chain in the world. As of 2019, the company operates in more than 30,000 locations all
over the world. The headquarter of the company is situated in Washington, United States.
Starbucks is known for its premium roasted coffee in the world (Cameron, 2019). For this
assignment, Starbucks’s Australian operations will be considered. The company came into
the country in the year 2000 and after a few years, they had to close around 60 stores
(Cameron, 2019). This resultant in the loss of millions of dollars. Since the closures of 2008,
the company still inaugurated new stores in the market (Dudovskiy, 2017). In this
assignment, there will be a discussion regarding the marketing plan of the company. The
marketing plan will include a value proposition, 7p's of marketing mix, positioning map,
segmentation and targeting population. In the end, recommendations will be made for the
future growth of the company.

Marketing Plan 4
Objectives
The objective of this is to make marketing plan which should consists information about the
marketing mix, segmentation of the market based upon various factors, making positioning
map for showing where the brand stands in market and making value proposition.
Marketing Strategy
Market strategy is the research which helps Starbucks in deciding how they can divide
their customers based on their age, priorities, common interest, income level, behaviour or
psychological traits, personality traits, demographic level, preferences, etc. In other words, by
understanding the marketing segmentation, Starbucks can also use this research in product
promotion and advertising.
Segmentation
The demographic segmentation of the company between the age of 25 to 45 year.
Psychological segmentation related that the customers of Starbucks belong to the upper-
middle-class category (Mooij, 2018). They also target those locations which are easy to reach
by coffee lovers. Initially, Starbucks targeted the elder age people then as their business starts
approaching towards growth, they added more segments like targeting teenagers and younger
age people. As already discussed, the main target market of the company is men and women
age between 25-45, they bring 49% of the total business. They also target adults age between
18-24 which bring around 40% revenue (Cameron, 2019). The targeted location includes
specifically high-class locations, the place near corporates and the college campus. The stores
provide to work with having electricity for connecting laptops and mobiles (Bernarda &
Smith, 2014). Thus, they target their group through the utilization of technology and
innovative ideas. The needs of their targeted market include premium class customer
hospitality, quality products which are beneficial to their health like usage of specific milk

Marketing Plan 5
and having a peaceful atmosphere (Hanif & Rodrigues, 2018). These all are the need of the
targeted market of the company and they are satisfying their needs. Customers always ready
to pay high prices because according to them their expectations are getting fulfilled (Dwivedi,
Kapoor & Chen, 2015). Starbucks targets those market where they can generate a greater
number of customers and sustain them for a longer period.
Positioning Map
(By Author)
Positioning map is the diagrammatic techniques used by the asset manager to
illustrate the company's positioning as compared to its competitor. The axis of the positioning
map includes low price, high price, low quality and high quality (Dwivedi, Kapoor & Chen,
2015). According to this positioning map, Starbucks stands on high quality with a high price
because the company tries to establish their brand image as the premium category in the
coffee industry (Mooij, 2018). They brought dark-roasted, whole bean coffee like Sumatra,
Ethiopia and Costa Rica. Utilization of non-fat milk in the coffee enables the company to
make a significant move in the Australian market (Hussainy, Hakim & Khan, 2014).
Dunk in’
Donuts7 Eleven
Mc Donald’s
Starbucks
Caribou
Low Quality
Low Price High Price
High Quality

Marketing Plan 6

Marketing Plan 7
Value Proposition
The value proposition of Starbucks focused on brand strategy. It compromised of three
components. The company uses the phrase “live coffee” because Starbucks wants to keep the
national coffee culture alive in Australia. From the retail perspective, the company wants to
establish its taste and ambiance in the general public so they can regularly approach to the
Starbucks coffee house (Nichols, 2013). The first component of the brand strategy implies the
“Quality of Coffee”. As the company offers premium quality of coffee in the world while
maintaining the supply chain (Liaukonyte, Teixeira & Wilbur, 2015). The second component
is service, it is also referred to as “Customer Intimacy”. It includes very simple behaviours
like remembering the customer’s name, drinks, etc. The last component is “Atmosphere”.
People visits to the Starbuck for having coffee and kind of atmosphere they are getting in the
stores. Therefore, it is extremely important for providing a kind of atmosphere that allows a
sense of community (Osterwalder, Pigneur, Bernarda & Smith, 2015).
(By Author)
 Quality of Coffee: It is about the nature of the espresso. Starbucks deliberately chose
their espresso beans from the best wellsprings of espresso all around the globe. By
along these lines, Starbucks was known for its "highest-quality espresso on the
Customer Intimacy
Atmosphere
Quality of Coffee

Marketing Plan 8
planet" to offer to their clients (Whittaker, Montgomery & Acosta, 2015). While most
people prefer coffee as part of their morning breakfast. Thus, is important that their
beverage should be made with the premium quality of beans. An espresso bean is a
seed of the espresso plant and the hotspot for espresso. It is the pit inside the red or
purple natural product frequently alluded to as a cherry. Much the same as common
cherries, the espresso natural product is additionally a purported stone organic product
(Percy, 2016). The pea-berry (seeds) happens just somewhere in the range of 10 and
15% of the time and it is a genuinely normal (yet logically doubtful) conviction that
they have more flavor than ordinary espresso beans (Graebig, Erdmann & Roder,
2014).
 Customer Intimacy:
For Starbucks, extraordinary administration quality signifies "Customer Intimacy".
The cordial connection between the baristas and clients (Buczkowski, 2012). It
implies that baristas did not just get ready beverages to clients yet in the manner in
which they like. The baristas were additionally prepared with soft-spoken abilities to
chatter with clients to set up an individual altered espresso cups that meet customers'
desire (Sanje & Senol, 2012).
 Store Atmosphere:
Starbucks offers its customers a "third spot" outside their work spot and their home.
This makes a Starbuck’s store a sanctuary spot to escape from this present reality. The
inside stylistic theme, the music, the light, the format, etc was intended to welcome
the client to remain longer in the store (Mooij, 2018). To facilitate client solace,
comfort and social communication, most Starbucks stores blend upholstered seats and
couches around the table. Most Starbucks stores offer free power to their clients with
the goal that they can connect their PCs and they also offer Wi-Fi access (Dwivedi,

Marketing Plan 9
Kapoor & Chen, 2015). The stores highlight a books library and game rack to urge
clients to settle in and spend time with their companions. To maintain the coffee taste,
Starbucks employees are restricted from wearing solid aromas because it may meddle
with the espresso smell and almost all Starbucks around the globe are non-smoking
inside (Dwivedi, Kapoor & Chen, 2015). The protection of the espresso coffee was
the reason that Starbucks surrendered its fleeting invasion into serving breakfast
sandwiches (Hanif & Rodrigues, 2018).

Marketing Plan 10
Marketing Mix
The marketing mix is the foundation model of the business. In this part, the marketing
mix of Starbucks will be discussed. This marketing mix will find out about the company's
main components. Starbucks uses the marketing mix plan for developing its reputation and
brand popularity in the market (Hussainy, Hakim & Khan, 2014). The company changes its
marketing mix plan to respond to new challenges and problems. This marketing mix will
consist of 7p’s:
 Product:
This product mix of Starbucks focuses on what products or services the company
offers in the market (Liaukonyte, Teixeira & Wilbur, 2015). It is recommended that
the company should focus on coffee beverages. The organization includes or adjusts
its product offerings with the point of extending its market reach and developing its
market share in the industry. The product mix of the company contains:
o Coffee
o Baked coffee
o Smoothies
o Frappuccino
o Mugs
o Other food items
 Place:
This component decides the venue or location where its customers can visit easily.
The company uses those channels which helps them to reach out to their targeted
audience effectively and efficiently. Their channel includes coffeehouses, cafes,
retailers and mobile applications (Dwivedi, Kapoor & Chen, 2015). Initially,

Marketing Plan 11
Starbucks starts selling coffee through their coffee houses after that they started
selling their products and merchandise through online stores. This implies that the
company adapts to changes their technology, market conditions and setup for copying
with the market scenario. It is recommended that the company should can also open
new coffee stores in the colleges and schools (Nichols, 2013).
 Promotion:
This marketing mix component will explain about the advertising and communication
strategies of the company. Starbucks company promotes its products through internal
personal relations and communications. As the promotion mix includes:
o Online promotion
o Banners
o Public relations
o Mouth-to-mouth marketing
The company becomes popular primarily through mouth-to-mouth publicity. They
offer premium class service to their customers, so customers started talking positively
about the brand (Keegan & Rowley, 2017). It’s helped the brand in getting free and
positive publicity which enhances the brand image. Apart from this, the company also
advertise their brand over the television and internet (Osterwalder, Pigneur, Bernarda
& Smith, 2015). The company should force more on the online means of promotion.
 Price
The company uses premium price strategy because this strategy works on the people
tendency of the premium price for premium products (Shareef, Mukerji, Dwivedi,
Rana & Islam, 2019). In general, Starbucks products and beverages are much more
expensive than their competitors (Osterwalder, Pigneur, Bernarda & Smith, 2015).