AE1 Portfolio 1: Marketing Analysis of Starbucks Coffee Company

This report provides a comprehensive marketing analysis of Starbucks. It begins with an introduction to the company, its founding, and its position as a global coffeehouse chain. The report then delves into the application of various analytical frameworks, including PESTEL analysis (Political, Economic, Social, Technological, Environmental, and Legal), SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats), and stakeholder analysis, to understand the company's external and internal environments. The report also examines consumer behavior, outlining the factors influencing customer purchase decisions through a step-by-step process. Furthermore, it explores Starbucks' market segmentation strategies, detailing how the company divides, targets, and positions its products to reach its desired customer base. The conclusion summarizes the key findings from the analyses, emphasizing the importance of these marketing strategies for Starbucks' success. References to relevant academic sources are included to support the analysis.

STARBUCKS

Contents
INTRODUCTION...........................................................................................................................3
TASK...............................................................................................................................................3
Application of analysis on Starbucks...........................................................................................3
Understanding the consumer behavior.........................................................................................5
Market segmentation....................................................................................................................5
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................7

INTRODUCTION
Starbucks is a American company which has multinational chain of coffeehouse and
reserves of roastery. The company has its headquarters in Seattle. It is also considered as a
largest coffeehouse chain into the world. Starbuck was founded by Jerry Baldwin, Zev Siegl and
Gordon Bowker in the year 1971. This report discusses the marketing environment of the
company which it undertakes. The report also includes the PESTEL analysis, SWOT analysis
and Stakeholder analysis of the company (Cucchiella, Gastaldi and Trosini, 2017). Apart from
this the report also includes the customer behavior and its process to evaluate the driving force or
factors through which the customers make a purchase.
TASK
Application of analysis on Starbucks
PRESTCOM analysis:
Political: The Company has a very strong support from the government for providing them the
infrastructure and also in access the company in new markets and suppliers. As the markets of
the countries are integrating, it helps the company in its expansions and growth. As the markets
and the business of the countries are exchanging and expanding themselves to the global level, it
has also benefited the Starbucks (Gregori-Giralt and Menéndez-Varela, 2015). The company has
set up its chain into the countries or the region which comes under the developed or developing
nations.
Regulatory: The regulations which the company follows throughout its chain are homogenous.
The company exercises the same regulation or code of conduct in all the regions or the countries
where they have establish their business. Although the company may exercise some minor
changes in its regulation according to the external factors which are prevailing into the region or
country but the core structure of regulation remain constant and same.
Economical: There has a rapid growth in the developing countries which works as a benefit for
the company. The disposable income of the people is increasing making them potential customer
for Starbucks as they can afford the prices (Hult and et. al., 2012). Apart from this the fluctuation
in raw materials and suppliers demand do put impact upon the prices of commodities provided
by the company.
Social: People are shifting their preferences to coffee, more and more people prefer to consume
coffee to drink. This has enabled the company in increasing of their sales. This taste and
preferences change has benefited the company a lot.
Technological: The advanced technological transport and the information management system as
helped the company is in transporting the materials or the goods at time and maintain a fair
records about the transactions, activities and operations which are done into the organization.

Competitive: The Company, Starbucks, is very much competitive. It knows the importance of
innovation and it’s why it tries to bring the innovative drinks or the products in the market to
gain competitive advantage.
Organizational: The Company takes care of its employees very much. It tries to build the values
and the culture within the organization which makes their employees very much comfortable and
motivated.
Market: The market for the company is very much huge. It serves through the world with its
coffee. The Starbucks has the strong market chain which is very hard to break.
SWOT Analysis
Strengths:
 Strong market
 Serves worldwide
 Quality products
 Gain competitive advantage
Weakness:
 High prices for premium quality coffee
 Faced hard time in establishing
themselves in developing countries
Opportunities:
 More expansions
 Diversification of product mix
 Customized innovations schemes
Threat:
 Growing vast amount retail business
into the market
 Any change in political rules and
regulations
 Increase in the prices for raw material
Stakeholder analysis
High power, high interest: In this category lies the director, CEO or the investors who have very
high power into the operations of company and also maintains a constant interest into the
company’s working (Maccheroni, Marinacci and Ruffino, 2013).
1. High power, low interest: The people such as investors or the stakeholders who have
invested the lot of money into the company but are not very much interested into its
operations, they only think about their share and profits.
2. Low power, high interest: In this category the people who exercise the low power into the
business but has the very much interest in its progress or operations. These people can be
employees of the company, the shareholders who has brought the shares of the company
and etc.
3. Low power, Low interest: In this category, lies the customers and the suppliers who are
least interested into the activities of the company also they exercise very least power into
its operations.

Understanding the consumer behavior
Consumer behavior is a process to know about the factors which determined the behavior
of a consumer to make a purchase of the product. As in regard with Starbucks, the company
would analyses the factors which attract the customers to but the company’s product (Stobbs and
Biernacki, 2012). By analyzing these factors the company would know more about the behavior
and attitude of their target market. The process of consumer behavior is as follows:
Problem Recognition: Here the customer would realize the need to drink coffee.
Information search: Here the customers would search for the information from where he can
buy coffee of his taste.
Evaluation of alternative: Here the customers would collect the alternatives from where he can
purchase coffee and will analyze these places according to many factors such as taste, price,
distance and etc.
Purchase decisions: At this stage the customer has finally taken the decision from where he
wants to buy his coffee and decided the Starbuck for it.
Post purchase evaluation: It is the stage where the purchaser evaluates the satisfaction level
which he gets from the purchase. Does he got satisfied from consuming the coffee of Starbucks
or not? Was it worth the money or not?
Market segmentation
Market segmentation has 3 parts:
Segmentation: In this the company divided or groups the market into various divisions. These
segmentation would be based on demographic, geographic, economic, social factors. Here the
Starbucks has divided the market into various groups according to the nature and features.
Targeting: In this stage, the company from the available alternatives selects the market which
they believe would be profitable to invest. Starbucks targets the regions which come under
developed or underdeveloped category.
Positioning: Positioning refers to the placing of products or services into the market place. It
also refers to setting an image about the company and its product into the minds of targeted
customers or market (Weatherill and et. al., 2015). As in the case with star bucks the company
must have use various promotional and advertisement activities to attract the customers.
CONCLUSION
From the report discuss above the internal and external analysis of the company has been
mentioned. Internal analysis includes the SWOT and stakeholder analysis whereas external

analyses include PRESTCOM analyses. The report also has mentioned about customer behavior
and the process. Apart from it, the report also has process of market segmentation.

REFERENCES
Books and Journals
Cucchiella, F., Gastaldi, M. and Trosini, M., 2017. Investments and cleaner energy production: A
portfolio analysis in the Italian electricity market. Journal of Cleaner
Production. 142. pp.121-132.
Gregori-Giralt, E. and Menéndez-Varela, J. L., 2015. Validity of the learning portfolio: analysis
of a portfolio proposal for the university. Instructional Science. 43(1). pp.1-17.
Hult, H.,and et. al., 2012.Risk and portfolio analysis: Principles and methods. Springer Science
& Business Media.
Maccheroni, F., Marinacci, M. and Ruffino, D., 2013. Alpha as ambiguity: Robust mean‐
variance portfolio analysis.Econometrica. 81(3). pp.1075-1113.
Stobbs, G. A. and Biernacki, J. V., 2012. Computer-implemented patent portfolio analysis
method and apparatus. U.S. Patent 8,095,581.
Weatherill, G.A.,and et. al., 2015. Exploring the impact of spatial correlations and uncertainties
for portfolio analysis in probabilistic seismic loss estimation. Bulletin of Earthquake
Engineering. 13(4). pp.957-981.