Analysis and Recommendations for Starbucks Customer Experience Report

This report provides a comprehensive analysis of Starbucks' customer experience. It begins with an introduction to customer experience and its importance, followed by an overview of Starbucks, including its founding, market position, and global presence. The report then delves into Starbucks' target customer demographics, highlighting the age groups that contribute the most to revenue. It examines the attitudes of Starbucks customers, emphasizing brand loyalty and the role of the customer experience in fostering positive relationships. The mission statement of Starbucks is analyzed, focusing on its customer-centric elements and its impact on the company's operations. The report presents an audit of customer manifestation using the American Customer Satisfaction Index (ACSI) and reviews customer satisfaction theories. Finally, it offers recommendations for Starbucks to improve its customer experience, focusing on preserving the Starbucks experience, providing coffee education, and addressing employee attitudes. The report concludes with a summary of the key findings and recommendations.

Customer Experience

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY ..................................................................................................................................3
About the company.....................................................................................................................3
Target customer of the company.................................................................................................4
Attitude of customers of the company........................................................................................5
Mission statement of Starbucks Corporation:.............................................................................5
Demonstration of audit of manifestation of customers:..............................................................6
Models and theories of customer experience:.............................................................................7
Recommendations for Starbucks to improve customer experience:...........................................8
CONCLUSION ...............................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Customer experience is an impression which the customers have for the brand as the
whole in all aspects of buyer's journey. There are two touchpoints which create the customer
experience which are product and people. Creating an experience impresses the buyers and make
sure that customers will do business with the company. It acts as the unique and valued asset for
the companies (Manthiou, 2020). It is different from the customer opinion and drives loyalty to
the organisation. It is mainly the interaction of the customer with the brand through its journey
with the company. The organisation chosen for this report is Starbucks, an American chain of
coffee house and the roastery reserves which is headquartered in Washington.. This report shall
deal with customer experience and cover what brand is, its target market, attitude of customers,
say of brand regarding customer service, manifestation of customer of the brand and
recommendation to improve the customer experience.
MAIN BODY
About the company
Starbucks was founded in the year 1971 which is an American multinational company. It
is one of the most popular and largest manufacturer and retailer of the coffee drinks worldwide.
The company owns more than 19000 stores in around 162 countries. Due to changing preference
of the customers, this industry has seen the rapid growth in the last few years. In the coffee
industry, Starbucks is the leading brand which has a market share of about 36.7% which more
than its leading competitors like McDonald's Etcetera and Dunkin Donuts. The companies like
Starbucks and Dunkin Donuts together make up a dominance in the market as they take around
60% of the market share. Starbucks is known as the premium brand whose aim is to deliver the
premium and best coffee experience to its customers (Keiningham and et. al., 2020). The
company has planned to partnership with the leading corporates to sell their Starbucks coffee at
the workplaces. It is known as the first brand which has offered the internet facility into the
coffee house for its customers to enrich their experience and build the brand image in the
technological advanced era. Starbucks comes in the list of top 100 global brands where it is
positioned at the rank of 91 so it is one of the most established and premium brand in the coffee
industry. The company has unconventional strategies for enhancing the customer experience and
the stake holder's experience. Starbucks have a positive and strong relationship with its suppliers

and eliminate the middlemen so that it can make a fair deal with the customers and work on to
improve its brand image in the market. The company have high morals and ethics which make it
a reputable and the consumer centric brand.
Target customer of the company
Starbucks is the most popular and leading brand of the coffee industry with
approximately $26.50 million of revenue generation in the year 2019. from the reports of the
company, it states that Starbucks have around 75 million customers who visit the stores every
month. The large scale operations of Starbucks creates the interest to look into the demographics
of the company and analyse its highest customer contribution. The picture below shows the
customer trends of Starbucks.
The above picture may help in drawing different conclusions which shows the customer
demographics of the company Starbucks. From the above pie chart, it can be said that 39% of the
revenue which is generated by the company comes from the age group of 16-25 while 32% of
revenue comes from the age group of 26- 35. furthermore, 11% of revenue is generated from the
age group of people who are of age 36-45 years whereas 18% revenue is generated from above
45 years of aged people. This shows that the target customer of Starbucks is millennials and
youth who prefer to consume the coffee of Starbucks. If the total contribution of the customers is
seen, it can be said that young adults of the age 16-35 are the major customer segment of the
company who are looking for the premium and rich coffee experience Hwang and Seo, 2016).
Illustration 1: Customer types of Starbucks, 2012

If walking into the store of Starbucks, it can be seen that major customers of the age
above 40 years are found but they make up to only 11% in the revenue contribution. This is due
to the fact that these customer segment prefer to consumer the drink at the stores which provide
them with the opportunity to socialise whereas the young generation are the one who likes to
have drink on the go.
The target market of the company is high income people as Starbucks offers expensive
products which can be afforded by the high income people who are willing to spend more on the
coffee drink. The business class people also got attracted to the company Starbucks when it
started to offer free Wi-Fi service in the year 2002 which allowed the people to set up their
devices and laptops to attend the meetings online in the sophisticated environment with coffee.
Attitude of customers of the company
It is said that different people have different attitude towards the same brand which may
be positive or negative. The customer of Starbucks have positive attitude towards the brand and
they exhibit the brand loyalty. It is not due to the fact that it offers high quality product but it is
due to the reason that it offers such experience and service to the people (Roy and et. al., 2017).
The product can be used as the status symbol which add to their experience as the customers are
treated with care and diligence which make them feel valued. Some of the customers are such
who are willing to pay even more if the company offers the product with the same quality which
results in creating the brand loyalty. This is the trust of the customer of the Starbucks which ask
them to pay higher and helps in creating the positive relationship with the company.
Mission statement of Starbucks Corporation:
The mission statement of Starbucks is, “ To inspire and nurture the human spirit- one
person, one cup and one neighbourhood at a time”. It is the statement which focuses on
customer centric elements of the company. It explain the primary role of the business for their
targeted customer(Brun and et. al., 2017). There are various component which is drawn with this
mission statement. It focuses on improving the life of the society. The mission of the company is
to create the better service by offering the best services and the quality value to their time. The
first component of the Starbucks statement is to make the difference in the lives of the society
and attract the customer for their services. The efforts of the Starbucks is meeting the customer
expectation and satisfying the targeted customer by numerous ways. Starbucks is offering the
services beyond than normal and exceeding the expectations of the customer. The primary goal

of this company is to give the extra ordinary service that meet the social responsibility of the
company. It is not only concern with the serving product to their costumer and generating
revenue. It focuses on overall experience of the customer and that's how the company is meeting
their second component of their mission statement by fulfilling the social impact on the business
(Trischler, Zehrer and Westman, 2018). The third component of the mission statement is to
explain that coffee service is the simple process. It is not complex or sophisticated and with the
top services strategies, the company have set the good customer base with simplicity of services
and How the business is setting their business strategies to satisfying the customer and that is
how Starbucks is meeting the expectation of the customer and contributing to the social welfare
of the society. The mission statement of the company is to give the quality product to their
customers and focuses on providing the coffee which is directly come the farms and brewed buy
the best practices to satisfied their potential customers. It give best services by providing the best
place to spend the quality time of the individual.
Demonstration of audit of manifestation of customers:
For analysing the customer experience, the company use the tool of scorecard that is
based on American Customer Satisfaction Index, which have 0-100 score and this is the highest
possible score to be scored(Pekovic and Rolland, 2020). It evaluates the various products and
services is provided to their potential customer. It also analyse the insight of the customer
experience. Graph depicting the ASCI scores of Starbucks audit from 2006 to 2019.

(Source: American customer satisfaction index scores of Starbucks in the United States from
2006 to 2019)
By analysing the graph, It is concluded that Starbucks is going through slowdown in their
business an generating less revenue. In the last few years the company is generating good profit
and increasing their business by 74 in 2015 to 79 in 2019. Customer is experiencing the best
services by company's improvement to offer best services.
Models and theories of customer experience:
There are various function and theories which help in enhancing the customer experience
and provide various strategies to implement the various ways to satisfy the costumer. CSAT is
the customer satisfaction theory which is concern with the satisfaction of the customer by
offering quality goods. It is the measuring tool which evaluate the satisfaction and expectation of
the customer (Hoyer and et. al., 2020) .There are four key elements of this model to measure the
expectations. It analyse the overall satisfaction measure, which comprise of evaluating the
expectation of the customer by offering quality goods. Loyalty measurement is the second aspect
of this model. It says that customer should be loyal to their brand and It can be done by
repurchasing of the potential customer and retain in the same brand. It can be done by offering

quality products to their potential customers. It also concern with the series of attribute
satisfaction measurement by improving the quality and meet the expectation of the customer.
Satisfaction of the customer will leads to repurchase the product and customer will do word of
mouth and social media marketing by various means and promote the brand through their
experience. These theories will help in measuring the basis and comprising the aspect of the
business and help in analysing the different market segment and then manufacture the product
that meet the expectation of the customer and leads to earn more profit and generate more
revenue.
Recommendations for Starbucks to improve customer experience:
 Preserve the Starbucks experience: It is necessary for the company to give the
best services and meet the expectation of the customer. People use to come their
to spend time, the cup is coffee is not that important than the experience of the
customer in their premises. This is the main concept of the company and coffee is
just the way of attracting the people to come there and spend the quality time.
 Make time for coffee eduction including coffee seminars including customers:
this will be the new concept in the market that attract the customer. This is the
way of getting large group of people visiting their brand. It is the way to share the
love for coffee and also explain the process of making coffee through master class
and by doing some seminars for learning the making of coffee and share the love
for coffee by organising the coffee master program(Khan and et. al., 2020).
 Weed out partners who just don't care or have the negative attitude of their
seniority: It is important to exclude the people from the organisation who are
creating hurdle in making the positive environment in the company and showing
their superiority complex at workplace. No employee is entitles to a job. Everyone
have earned the success and got their position by their hard work so no one have
got the right to deminising the respect of the individual and letting them down and
behaving like the most superior person in the company and ruling on everyone
and creating the bad environment in the workplace.
 Increase the amount of pay that the most tenured Starbucks baristas get: For
motivating the employees in the organisation. It is necessary to increase the salary
of the employees and pay according to their working capacity and performance I

the various business operations. It is necessary to compensate the most valuable
candidate in the organisation and picking the high working employee that give
their best in achieving the business goal of the company.
 Slow down the rate of new licensed store: For expanding their business in the
new market, It is important to give their store on minimum required rents to
expand their market size across the world. This will leads to earn more profit in
the various stores and generate higher sale in the market.
CONCLUSION
It is concluded from the above report that customer experience works as an asset for the
company as it enhances the impression of the brand in the minds of the customers. Starbucks is a
premium brand which has a loyal customer base. It offers high quality product to the customers
to which its target market consumes. The target market of Starbucks is youth and millennials
who are willing to spend more on its product. The customers get enriched experience while
consuming the service. According to the utilitarian theory, the customers of Starbucks have
positive attitude towards the company due to its positive and warm experience which it gives.
But there are some problems which the company is facing to which it is recommended to
Starbucks to have innovation and personalised service so that it can enhance the experience of
the customers. It also analysed the theories and model of customer satisfaction and that helps in
analysing the trends in the market and leads to earn more profit. By eliminating the managers
from the business who are creating the negative environment in the business that will leads to
smooth running of the business.

REFERENCES
Books and Journals
Brun and et. al., 2017. Impact of customer experience on loyalty: a multichannel
examination. The Service Industries Journal, 37(5-6), pp.317-340.
Hoyer and et. al., 2020. Transforming the Customer Experience Through New
Technologies. Journal of Interactive Marketing.
Hwang, J. and Seo, S., 2016. A critical review of research on customer experience
management. International Journal of Contemporary Hospitality Management.
Keiningham and et. al., 2020. Customer experience driven business model innovation. Journal of
Business Research, 116, pp.431-440.
Khan and et. al., 2020. Customer experience and commitment in retailing: Does customer age
matter?. Journal of Retailing and Consumer Services, 57, p.102219.
Manthiou, A., 2020. Applying the EEE customer mindset in luxury: reevaluating customer
experience research and practice during and after corona. Journal of Service
Management.
Pekovic, S. and Rolland, S., 2020. Recipes for achieving customer loyalty: A qualitative
comparative analysis of the dimensions of customer experience. Journal of Retailing
and Consumer Services, 56, p.102171.
Ponsignon, F., Durrieu, F. and Bouzdine-Chameeva, T., 2017. Customer experience design: a
case study in the cultural sector. Journal of Service Management.
Roy and et. al., 2017. Constituents and consequences of smart customer experience in
retailing. Technological Forecasting and Social Change, 124, pp.257-270.
Trischler, J., Zehrer, A. and Westman, J., 2018. A designerly way of analyzing the customer
experience. Journal of Services Marketing.