Starbucks Marketing Mix Analysis and Recommendations for Australia

This report provides a detailed analysis of Starbucks' marketing management strategies within the Australian market. It begins with an executive summary and table of contents, followed by an introduction that outlines the report's purpose and scope. The core of the report focuses on identifying and analyzing the target market personas, including youth and business professionals, detailing their demographics, behaviors, and motivations. A comprehensive marketing mix analysis, covering the 7Ps (Product, Price, Place, Promotion, Process, Physical Evidence, and People), is conducted, offering specific recommendations for each element. These recommendations include a quality-focused product strategy, premium pricing, direct distribution channels, and a strong emphasis on social media marketing. The report also suggests the use of hybrid trucks for distribution, employee diversity from the aboriginal community, and user-friendly websites. Finally, it emphasizes the importance of internet marketing and email communications. The report concludes with a summary of findings and a bibliography of cited sources.

RUNNING HEAD: STARBUCKS
MARKTING
MARKTING MANAGMNT
Student name:
Student number:
Word count: 3000

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Executive summary
The key objective of the report is to frame effective marketing strategies for the
Starbucks marketing mix in Australia. The company should opt for quality-focused strategy,
Premium pricing, direct channel distribution, social media marketing for the 4P’s of
marketing. For the extended pricing mix, it should consider the use of hybrid trucks,
employee individuals from the aboriginal community and must develop user-friendly
websites. It should mainly develop the use of social media platforms and e-mail to
communicate to its target market.

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Contents
Introduction................................................................................................................................3
Target Market Persona...............................................................................................................3
Youth......................................................................................................................................4
Businessman...........................................................................................................................5
Marketing Mix Analysis............................................................................................................6
7P’S of marketing...................................................................................................................6
Recommendations......................................................................................................................9
Conclusion................................................................................................................................10
Bibliography.............................................................................................................................12

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Introduction
The report reflects on the marketing management of an organization named
‘Starbucks’. Marketing Management is planning, organizing, controlling and implementing
the marketing strategies and tactics for the fulfillment of marketing objectives and raising
satisfied customers. It aims to raise product/service demand and maximize organizational
profitability by raising customer satisfaction (Kotler, Keller, Ang, Tan, & Leong, 2018). It
aids in increasing brand recognition and provides the right direction to achieve the
organizational goals. It assists the organization to consider customer’s needs and desires and
developed effective strategies based on marketing mix elements (Product, Price, Place, and
Promotion) (Lee & Carter, 2011).
Starbucks is a globally renowned company founded in the year 1971 in the United
States. In the year 2019, it has 31254 stores in the global world (Lock, 2019). It is engaged in
the production of multiple products and it offers products like iced tea, cold brew, nitro,
Starbucks refreshers, caffé Americano, hot and iced espresso beverages, fresh juices,
Frappuccino, snacks, and delicious food items. It is a premium brand and offers the product at
a relatively high price to its customers. It has multiple competitors and it includes Costa,
McDonald's, Dunkin Donuts, and Cafe Coffee Day (Owler, 2020). These companies offer
similar products to customers at competitive prices in the food and beverage industry. It has a
high reputation and a fine customer base in Australia and the global market. Considering the
assignment structure, the initial section provides the target market persona. The next section
includes information based on the 7P’. It involves the application of relevant strategy and
tactics to gain effectiveness in the 7P’s of marketing. The succeeding part involves practical
recommendations for communication strategies. The key purpose of the report is to
emphasize the company's marketing strategy with the application of relevant models and
frameworks.
Target Market Persona
A marketing persona is a detailed document of the target audience and it takes into
account multiple factors like age, occupation, status, location, personality, and behavior. It
also includes elements that motivate, frustrate, and influence their buying process (Revella,
2015). Starbucks targets youth and businessman of Australia. Below is the detailed marketing
persona of its target market.

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Youth
TARGET MARKET
AGE: 15- 24
OCCUPATION:
Student
STATUS: Single
(Mostly)
LOCATION: Urban
areas of Australia
PERSONALITY
The youth tries to
adopt a high
personality to depict
on social media to
gain the attention of
viewers.
INTEREST/BEHAVIOR
They show a high
interest in trendy and
innovative
products/services. They
show positive behavior
towards the fast food
items as it fulfill their
cravings.
MEDIA/BRANDS
The youth
population is not
engaged in work and
thus it has adequate
time to devote to
social media. They
are active on social
media platforms like
Facebook and
Instagram.
MOTIVATORS
The youth
population has
limited financial
resources as they
are mainly students.
Thus, heavy
discounts and
coupon codes are a
motivating factor
among the youth. It
develops a
motivating force to
opt for the
product/services.
FRUSTRATIONS
They are highly
frustrated by the sudden
rise in product price as
they have limited
resources and they find
difficult to avail of the
product/service.
Product price not
matching the product
value can also irritate the
youth population.
INFLUENCES
They are highly
emphasized by
brands that consider
their needs and
preferences.
Additionally, they
seek for a friendly
environment to
enjoy their product.
The advertisement
has a high influence
on their buying
behavior. They seek
for the product
promoted by ‘Pop
Celebrity’ (Parveen,
2018). The product
price is one of the
main elements
laying a high

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influence in their
buying decision.
Businessman
TARGET MARKET
AGE: 25 – 55
(approximately)
OCCUPATION:
Business
STATUS: Single
and Married
LOCATION: Urban
areas of Australia
PERSONALITY
The Businessmen
are the followers of
high personality and
thus they lay high
attention to
maintain and raise
their lifestyle. Thus,
they mainly opt for
premium
products/service to
fulfill their needs
and cravings.
INTEREST/BEHAVIOR
They show positive
behavior towards
premium products and
they have a high interest
in Product quality
(Bastien, 2015).
MEDIA/BRANDS
They are busy in
their professional
life and they mainly
opt for digital media
like e-mail. They are
highly active on
digital media but
less likely on social
media as they have
limited time.
MOTIVATORS
High-quality
products and early
and timely service
are the motivating
factors for the
businessman.
FRUSTRATIONS
Poor customer service
and unresolved queries
and complaints can
highly frustrate the
businessman.
Additionally, bulk
marketing messages can
also irritate them as they
are highly busy in their
professional life.
INFLUENCES
They are highly
influenced by the
place element of the
marketing mix. This
is because they opt
for products that are
easily convenient
and accessible.
Additionally, they
are influenced by
the word of mouth
marketing of a
product as they
consider it as

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trustworthy and
genuine.
Marketing Mix Analysis
Marketing Mix refers to the tactics, strategies, and plans undertaken by the
organization for product promotion. It takes into account multiple factors like Product, Price,
Place, Promotion, Process, Physical evidence and People (Huang & Sarigöllü, 2014). Below
is the market mix analysis by considering the target market (youth and businessman)
7P’S of marketing
Product: It is the commodity offered to fulfill the needs and preferences of the
customers. The company should offer a high-quality product to gain customer's trust and
generate loyal customers. It should develop innovative products to maintain customer’s
interest in the organization. The organization should expand the product line to offer a high
variety and fulfill the distinct needs of the customers (Singh, 2012). Starbucks should lay
attention to the 'Quality Focused' strategy in the production of Caffé Americano. It should not
compromise with the product quality and must provide valuable and mouth-watering coffee.
It should avail of the use of fresh raw material in the preparation of Caffé Americano. Thus,
offering a high-quality product assist the company to retain old customers and attract new
customers. Additionally, it will also benefit in minimizing competition from its rivals named
CCD, McDonald's, and Costa.
Price: It is the financial value paid by the customers in return for the
product/service. The company price should match the product value offered to customers.
The company should set the product price according to the target market. There are multiple
types of pricing strategies and it includes Price skimming, Penetration pricing, Economy
pricing, Competitive pricing and Premium pricing. The company should offer discounts to
boost product sales (Kim & Hyun, 2011). Starbucks should develop the use of 'Premium
Pricing' strategy to offer Caffé Americano to the customers. It refers to selling products at a
relatively high price to develop an impression of high quality from the customer's
perspective. This pricing strategy is suitable as business class individuals easily purchase the
product of higher quality. Additionally, it will allow them to maintain their status and raise
their lifestyle.

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Place: It is the distribution channel adopted by the company to offer
products/services to the end-users. It is the geographical location of the availability of
products. There are multiple distribution channels and it includes 'Direct' and 'Indirect'
channel to offer products/services. It should offer the product at prime locations to be easily
accessible to the end-users. It will allow the organization to set them apart from the
competition thus, finding the right business location is a marketing tactic (Khan, 2014).
Starbucks should open its stores in prime locations of Australia as it will allow the company
to easily attract customers in high volume. Additionally, it should opt for the 'Direct
Distribution' channel. It eradicates the involvement of middleman and allows in delivering
product directly to the customer. It assists the company to cut costs by removing the
availability of middleman and in early fulfillment of customer cravings for coffee. It will
enable the company to maintain the quality of its caffé Americano and directly deal with the
customer. Directly engaging with the customers will help the organization to gain a better
understanding of the customer's taste and preferences.
Promotion: It includes the activities undertaken by the company for product
promotion, attracts new customers and to raise brand awareness. The organization should lay
prior attention to opting for the right form of marketing media to gain customer attention. It
should not rely on a single platform but it should consider multiple suitable media to draw
customer's attention towards its product/services. The various forms of marketing methods
include internet marketing, content marketing, relationship marketing, sales promotion, word
of mouth marketing and many more (Brooks & Simkin, 2012). Starbucks should mainly opt
for internet marketing. It should offer coupon codes, bonus points, and discounts as a part of
sales promotion techniques. It will boost product sales and assist in gaining the attention of
the youth population. It should offer high-quality service to give rise to positive word of
mouth marketing. It is perceived as highly genuine and trustworthy by the customers and aid
in attracting new customers and increases its reputation in the market.
Process: The system and process of the organization affect the execution of the
service. The business enterprise should adopt a well-tailored process to minimize cost and
raised profit. The company should avail the use of the right packaging material to easily gain
customer attention. Additionally, it should be appropriate and suitable for the product as it
will assist in easy transportation, storage, and offers high convenience to the customers (Riaz
& Tanveer, 2012). Starbucks should avail of the use of electric and hybrid trucks in their
transportation process. It will offer two benefits to the company. Firstly, it will assist in

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minimizing the cost involved in fuel in the transportation process. Secondly, it will allow the
company to fulfill its corporate social responsibility towards society by minimizing the
carbon emission. It will also raise the company's reputation in the market for laying steps
towards sustainability. Additionally, it should lay focus to reuse and recycle the products to
minimize wastage and save cost. It should seek for trained staff to minimize the cost of
training and development (Marketingmix, 2020).
Physical evidence: It includes the steps undertaken by the company to reassure and
attract the customers towards their product/service (Vivek, Beatty, & Morgan, 2012).
Starbucks should lay high focus to design the exterior of its impressive stores effectively. It
should offer a relaxing and calm place to their customers to offer a positive, fun, friendly, and
relaxing environment. It should recruit well-trained staff to offer attractive service to the
customers. It should tie the staff incentives with the customer’s ratings on their satisfaction
level. It will develop a motivating force among the staff members to offer quality service to
the customers. It will assist the company to raise a high number of satisfied customers and
improved customers rating. Additionally, it should develop an attractive but user-friendly
website for its customers. Thus, customers have to devote less time to check and order a
product via the Starbucks website.
People: These are the individuals who assisted the organization for the fulfillment
of the customer's needs. The organization should lay high attention to offering adequate
managerial support, culture. It attains a high need to seek efficient and skilled employees as
they will aid in offering superior customer service. The organization must offer the required
training to improve employee's existing skills and develop new skills among them. It will
allow the employee to perform better and offer the best possible outcome for the
organization. Thus, it will offer an internal competitive advantage to the organization
(Gilaninia, Taleghani, & Azizi, 2013). Starbucks should recruit skilled and talented
employees to minimize the cost involved in training and development.
It should opt for coaching and mentoring to offer training to its new employees.
Mentoring is an effective and economical training program to raise the understanding of an
employee. It will assist the employee to save training costs and develop interpersonal
relationships between the existing and new employees. Additionally, it should offer an
opportunity for people belonging to the aboriginal community in Australia. It will assist the

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company to fulfill its corporate social responsibility towards society and it will raise the
company's reputation in the market.
Recommendations
The company should frame the communication strategies by considering the target
market as they are the key parties involved in the communication process. The following are
the suggestions for Starbucks to effectively communicate with the customers.
Social Media is one of the best platforms to communicate with customers. This is
because youth mainly remain active as they devote adequate time on these social media sites.
Additionally, it directly connects the organization to the customer and it saves the time of the
organization. It has a high user engagement rate and it is one of a suitable means to
communicate (Hastings & Stead, 2017). Additionally, it provides easy access to a large
customer base. Therefore, Starbucks should rely on 'Facebook' to communicate with its
customers. This is because it is a top used social media network as it has 17.1 million visitors
in an average of four weeks. With the passing years, the number of Facebook users is also
increasing. In the future, it can also opt for Instagram as it is also one of the growing social
media platforms (Roymorgan, 2019).
It should train its staff to effectively communicate with the customers. They should
have adequate knowledge to make on-spot decisions in the communication process. It should
recruit employees excellent communication skills as it enables good communication between
the two parties (Noe & Kodwani).
It should lay prior attention to conduct early communication with unsatisfied
customers. It will allow Starbucks to solve their queries and provide an effective solution. It
will assist in minimizing the possibility of poor word of mouth and negative feedbacks on the
digital channel (Verma, Gustafsson, Kristensson, & Witell, 2012).
Starbucks should opt for 'Chatbots' to communicate with the customers on the digital
channel. It will offer multiple benefits to the company. Firstly, it will assist in minimizing the
dependence on human resources. Secondly, it will aid in providing an early and timely
response to the customers. Lastly, it safeguards the cost of the company by limiting human
resources (Heo & Lee, 2018).

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The company should seek the help of a marketer to effectively communicate with
the target market. It will save the company's efforts on communication and it will be able to
devote attention to other relevant areas.
It should develop a mobile application or a company's app for smooth and easy
communication with the customers. Additionally, customers will also be able to easily share
their grievances and complaints via the mobile app of Starbucks (Jobber & Chadwick, 2012).
It should opt for a suitable form of communication methods and it mainly includes
texting, calling and face to face communication. It also focuses on businessman and therefore
it should opt for ‘e-mail’ to communicate with the customers as they are highly engaged in
their work. It will aid the organization in gaining timely and regular updates from the
businessman customers (Khang, Ki, & Ye, 2012).
Communication is a significant part of customer service and therefore it is
recommended that Starbucks should offer '24*7' availability to its customers. Thus, it will
assist the customer to communicate with the company at any time.
It should also lay attention to treating its customers with due respect in the
communication process. Additionally, it should never argue with the customer as it may
develop company negative image in the customer's perspective and it can also lead to loss of
customers (Verma, Gustafsson, Kristensson, & Witell, 2012).
For long term success, it should focus on customer relations and must undertake
efforts to maintain and enhance their relationships. Additionally, it should accept its mistake
and must not deny or try to cover it up. It should apologize to its customers in the
communication process.
It should try to understand the customer's point of view and must call, message, and
e-mail the customer at the right time as trying to communicate with the customer at the wrong
time will annoy the customer (Vivek, Beatty, & Morgan, 2012).
Conclusion
The discussion summarizes the marketing management of Starbucks. From the
above discussion, it is acknowledged that marketing management refers to managing all the
activities, strategies, tactics, and plans engaged in the promotion of a product/service. The

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marketing mix includes the Product, Price, Place, Promotion, Process, People and Physical
evidence. It is analyzed that all the marketing mix elements attain high significance in the
product/service promotion in the market. Starbucks should avail the use of a quality-focused
strategy to offer high-quality products. Considering the price element, it should opt for the
premium pricing strategy. Direct channel distribution will be best suited to minimize the cost
and offer a product to the customer promptly. Starbucks should avail the use of social media
marketing to gain the customer's attention. It should opt for 'Facebook' as a platform to
promote its product. In the process mix, it should avail the use of hybrid and electric trucks in
the transportation process. It should consider attractive packaging to attract customers and lay
a high focus on reuse and recycle. In physical element, it should opt for attractive buildings,
skilled and trained staff, user-friendly website, and must tie incentives of their staff with
customer ratings. Considering the people element of the marketing mix, it should recruit
individuals from the aboriginal community as well. Additionally, it should rely on coaching
and mentoring to offer training to the new employees as they are economical in approach. It
is suggested that Starbucks should opt for social media platforms to communicate with its
customers. It should train staff to improve their communication skills, conduct early
communication with unsatisfied staff, avail the use of Chatbots and seek help from the
marketer. Moreover, it should develop mobile applications, and offer ‘24*7’ availability to
the customers. Thus, Starbucks should opt for all these marketing strategies and suggestions
for marketing management.

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