Starbucks Case Study: Product, Service Marketing & Success Strategies

This case study analyzes Starbucks, examining whether it operates primarily as a product or a service, providing justification for the answer. It then delves into how Starbucks applies service marketing principles, such as the levels of product and service value, to achieve success. The analysis incorporates the 7Ps of service marketing, exploring elements like product, price, place, promotion, people, process, and physical environment. The study highlights Starbucks' approach to product differentiation, customer satisfaction, and brand building within the competitive coffee industry. It also discusses the company's strategies for attracting and retaining customers through various marketing tactics and service offerings. The assignment concludes by summarizing the key findings, emphasizing Starbucks' ability to integrate product and service elements effectively.

Running Head: SERVICE MARKETING 0
Service Marketing
(Student Name)

SERVICE MARKETING 1
Table of Contents
Introduction......................................................................................................................................2
Definition of product or service.......................................................................................................2
Product or service of Starbucks...................................................................................................2
Marketing Mix of Starbucks............................................................................................................3
Product Elements of Starbucks....................................................................................................4
Differentiating service from goods..............................................................................................4
Conclusion.......................................................................................................................................4
References........................................................................................................................................5

SERVICE MARKETING 2
Introduction
Starbucks was started in 1971 with three founders of it. They have only one idea in mind that the
best brewed coffee to be supplied by them with only a unique taste to be served everywhere
wherever the store gets open in future. The best brewers are selected from the country that can
bring the sipping coffee lifetime experience with the machines present. They invented a product
which they can sell out in the public who loved coffee with the product named as Starbucks to
the buyers (Mason, A., Cole, T. and Goza, 2017).In the following part there will be detailed
analysis of the services provided by the company that made them competitive in the market.
Definition of product or service
Product means anything which is being offered for sale and has a price set in the market which a
customer tends to buy on which includes profit after costing. This can be in virtual world or real
world it can be felt or just enjoyed in satisfaction. Product has a useful life which tends to be
absolute after which it has to recharged, refilled, or exchanged in replacement as the case may be
(Belkadi et al., 2016).
Here the service means that the act of performance which moves from the giver to receiver. The
service is generated when there is a transaction of physical touch or say tangible thing but the
service actually received and given is down in an intangible form and it does not result in any
thing of production. It is actually what you’re paying for and you’re getting the service for.
Services are the economic activities which generate revenue for the giver and it gives a channel
to the receiver to move funds in the economy. It’s the duty of service giver that the actual service
which was demanded by the service receiver has to be delivered to him in the real senses so that
the real definition of service to be intact there (MacDonald, 2015)
Product or service of Starbucks
The product should has to have a name with brand like the “STARBUCKS COFFEE” so that
everyone comes to know about it with a proper communication established as done by Starbucks
so that the consumer gets to know about your product and at the last the product should be
according the customer demand what can be the best thing for their satisfaction.

SERVICE MARKETING 3
Starbucks is a product which has converted into service. As here in the case of STARBUCKS the
founders were in the full interest to give a certain product in the form of service which will be
the unique one and the taste will be intact at all the outlets. The atmosphere which is being
provided by the Starbucks for the coffee customer is at its best level as the service provided to
him is at the next best level so that they can convert him into an asset for the company so that it
can convert more clients in the future to increase revenue. Starbucks is giving both the things
service and product or in the words we can say that they have converted the product into a
service (Kang and Namkung, 2018).
Marketing Mix of Starbucks
There are seven P’S for the term service marketing which make it a term so that companies can
apply service marketing principles in there organization at a large:-
Product
The company is specialized in the coffee as well as other related beverages. Starbucks sells
coffee, Italian style espresso beverages as well as other selection of premium teas. Moreover,
Starbucks also offer other food items such as they offer 6-eur sandwiched, desserts as well as
CDs in their stores as well as also selling package coffee in the supermarket.
Price
Starbucks is famous for its richly brewed coffee as well as selection of premium teas. Many
consumers have made the use of such perception according to which they set a premium pricing
as the pricing strategy of the company (Harrington, Ottenbacher and Fauser, 2017).
Place
The company offer its services as well as product through its store. It operates in more than 70
countries and also has stores of over 24000. It has also introduced Starbucks express to provide
quick service to its consumers. In such process, the consumer can pre-book its product through
pre-payment and can call before arriving on store. The product will get ready for them
Promotion

SERVICE MARKETING 4
The company uses number of promotional strategies to communicate with its stakeholders. It
provides Starbucks cards in November 2001. Such card was priced from 3.50 euro to 350 euros.
It is one of the innovative methods to attract the consumers. Moreover, free WIFI service is also
provided to the consumers to retain on regular basis.
People
The company has invested in the program of string employee benefits that help the company t
retain and attract skilled employees. It also provides health insurance as well as modest stock
option to part time workers.
Process
The business function of Starbucks goes through process. Starbucks is the busy place and the
employee is required to deliver effective service to the consumers as efficiently as possible.
Physical Environment
The company offer the consumers an inviting atmosphere. It has adopted a new approach for
design of stores. The company provide familiar cluster to the consumers in an efficient and
effective manner (Nanda Dwipamurti, Mawardi and Nuralam, 2018).
Product Elements of Starbucks
Starbucks provide variety of food and drinks to its consumers. The supplementary products are
espresso beverages, coffee; Frappuccino blended beverages, refresh, cold brew, muffins, cookies,
pastries & doughnuts, fresh fruits, bottled soft drink as well as tea. The company is also famous
for its expertly roasted as well as richly brewed coffee.
The complementary service that is provided by the company is free Internet WFI with friendly
environment and sitting space to the consumers with low music that relaxed the consumers
(Moon and Byun, 2016).

SERVICE MARKETING 5
Differentiating service from goods
Product is one of the tangible things. It can be defined as the item that can be touched and
consume by the consumers. However, service is more difficult. It changes with the situation. The
Starbucks provide effective service to consumers with product. It provide other services such as
serving coffee, understand the need of consumers, make them feel relaxed than made them
unique from its competitors.
The service make the consumer feel more satisfied. Delving product is not the only task to
satisfy the consumers, after sales service and treating them with smile made the day of
consumers that make them feel comfortable and force them to retain regular consumers in an
efficient manner. Therefore, such service makes competitive advantage to the company in an
effective manner (Dong and Sivakumar, 2017)
Conclusion
From the above analysis it can be concluded that Starbucks is one of the leading company that
provide various services to its consumers. The company offer product as well as also provide
effective service to the consumer’s to make them feel comfortable. The company offer variety of
product at premium pricing that cover wider range of consumers. The service has boarder
concept that product that treated competitive advantage to the company in an effective manner.

SERVICE MARKETING 6
References
Belkadi, F., Buergin, J., Gupta, R.K., Zhang, Y., Bernard, A., Lanza, G., Colledani, M. and
Urgo, M. (2016) Co-definition of product structure and production network for frugal innovation
perspectives: towards a modular-based approach. Procedia CIRP, 50, pp.589-594.
Dong, B. and Sivakumar, K. (2017) Customer participation in services: domain, scope, and
boundaries. Journal of the Academy of Marketing Science, 45(6), pp.944-965.
Harrington, R.J., Ottenbacher, M.C. and Fauser, S. (2017) QSR brand value: Marketing mix
dimensions among McDonald’s, KFC, Burger King, Subway and Starbucks. International
Journal of Contemporary Hospitality Management, 29(1), pp.551-570.
Kang, J.W. and Namkung, Y. (2018) The effect of corporate social responsibility on brand
equity and the moderating role of ethical consumerism: The case of Starbucks. Journal of
Hospitality & Tourism Research, 42(7), pp.1130-1151.
MacDonald, N.E. (2015) Vaccine hesitancy: Definition, scope and
determinants. Vaccine, 33(34), pp.4161-4164.
Mason, A., Cole, T. and Goza, N. (2017) STARBUCKS: A CASE STUDY OF EFFECTIVE
MANAGEMENT IN THE COFFEE INDUSTRY. Journal of International Management
Studies, 17(1).
Moon, S.A. and Byun, G.I. (2016) Research on the Effect of Experiential Elements on Brand
Attitude, Visitor's Satisfaction, Revisit Intention-Focusing on Regional Product
Festival. Culinary science and hospitality research, 22(2), pp.189-205.
Nanda Dwipamurti, I., Mawardi, M.K. and Nuralam, I.P. (2018) THE EFFECT OF GREEN
MARKETING ON BRAND IMAGE AND PURCHASE DECISION (Study on Consumer of
Starbucks Café Ubud, Gianyar Bali). Jurnal Administrasi Bisnis, 61(3), pp.57-64.