The Starbucks` Royalty Reigns Case Study

Assignment 2

The Starbucks` Royalty Reigns Case Study

Jack Welch Management Institute

JWI-518 – Marketing in the Global Environment

The Starbucks` Royalty Reigns Case Study

Introduction

Starbucks is a coffee company and coffeehouse chain that began in Seattle in 1971. With over 24,000 locations worldwide, Starbucks has evolved from merely selling coffee drinks to include breakfast and bakery products, sandwiches, smoothies and other varieties. With their mission being to inspire and nurture the human spirit – one person, one cup, and one neighborhood at a time, Starbucks set out to find new ways to increase customer loyalty.

The Starbucks Royalty Reign article takes a look at the massive impact that digital marketing has had on the success of the company. In 2011 Starbucks launched their app and realized that digital tools would be the best way to maintain their customers as well as gain new ones. According to the article, in just 4 years, the company was able to increase the number of customers making purchase through the app as well as the companies profit more so than they had done in previous years. The company realized that this app provided them an easier connection with loyal customers as well as new ones, with this, they set out to find additional ways to continue expanding their brand digitally.

Analysis

Currently, Starbucks utilizes a few different digital marketing tools. A major one for which is their starbucks app which is quite interactive for the customers and allows them to do just about anything from the app. They can place and pay for orders, send gift cards, track their rewards and many other things which customers would deem as being valuable and notable qualities. With the app, the starbucks reward tracker was one that made a big impact on customers. The reward program gave loyal customers the ability to track their points and gain ‘stars’ regardless of what store they purchased from. It also gave loyal customers the chance to view new products before they were in store, birthday pers and many other privileges. The company makes continuous updates to their app making it one of their biggest digital success.

Their website is also highly utilized,based on personal observation, it is clear that just about anything can be found there. The website is not only targeted towards their customers but also provides sections for businesses, career and customer service. The website contains quite a bit of information about the company , which entails a very detailed list of their menu, ways in which to track or join their starbucks reward programs, purchase as well as access gift cards and find other ways to keep track of what the company has to offer. They also have a website that is geared towards customers contributing ideas of what they would like to see in the stores, and Starbucks actually implements them.

Starbucks has also been partnering with different companies to expand their digital reach. They have partnered with apple, to gain access to Itunes for their customers, they also partnered with yahoo by creating a network in which, when customers enter the store, they can connect to the network and gain access to exclusive and free content. In the world of social media, starbucks has also dominated the field and has thousands of followers on Facebook, Twitter, Pinterest, Google followers, Instagram and Youtube. They use these mediums so that they can retain their loyal customers and gain new customers daily. They post information about their websites, app, products all of which are done in a manner that is exciting and appealing not only to coffee lovers but the general population as well.

After reviewing a few of starbucks newsfeed,alot of their posts reflects on the positive effects that consumers have in helping the employees of starbucks as due to their loyalty they are able to hire veterans, complete projects and make donations. Because of the type of presence that they have allowed themselves to have, they have seen a greater increase in their revenue in ten years that many companies see in twenty years.

Jaaskelainen, L. (November 2017) States:

“The company’s revenue growth also reflects its success: Starbucks’ annual revenue almost tripled in the last ten years, reaching 22.39 billion U.S. dollars in 2017. Further continuing its global expansion, Starbucks increased its number of establishments by around two thousand during 2017, totaling 27,339 stores by the end of the fiscal year. A Nielsen Scarborough survey found that over 37.8 million Americans had visited a Starbucks within the last 30 days.”

Below shows a chart that maps the revenue growth of Starbucks from 2003 up until 2017.

The Statistics Portal 2017

It is clear, that the steps that Starbucks has taken has led to remarkable success.

Recommendations

Based on the readings, it seems as though Starbucks is currently dominating the digital marketing world as is. They have been able to triple their revenue by the success of their apps and website as well as their partnership with other companies as well as more than double their customer size with most of their first time buyers becoming loyal customers. With that being said, there is always room for growth and improvement. Currently, even though they have a social media presence, Starbucks does not make posts as often as most customers would like. While there is the aspect that less is more, Starbucks has the opportunity to create more presence in their social media accounts. Currently, they contribute and undertake different products, by promoting these more on their pages they would be able to target more customers. The general population enjoys a company that gives back. Another thing that they could do is explore more partnerships. Google has a large impact on media, a pairing with google could take the company to the next level.

The digital marketing tools and campaign that Starbucks has established and undertaken has allowed them to become a household name, a go to coffee store for family and friends and one of the most powerful coffee shops around the world.

References

About Us. (n.d.). Retrieved May 20, 2017, from https://www.starbucks.com/about-us

Almquist, E. Senior, J. Bloch, N. September 2016. Harvard Business Review. The Elements of Value – Measuring- and delivering- what consumers really want. Pearson

Financial Data. (n.d.). Retrieved May 20, 2018, from https://investor.starbucks.com/financial-data/sec-filings/default.aspx

Huff, T. (2014, August 23). How Starbucks Crushes It on Social Media. Retrieved May 20, 2018, from https://www.socialmediatoday.com/content/how-starbucks-crushes-it-social-media

Jaaskelainen, L. (n.d.). Topic: Starbucks. Retrieved May 20, 2018, from https://www.statista.com/topics/1246/starbucks/

Kotler, P., & Keller, K. L. (2009). A framework for marketing management. Upper Saddle River: Pearson.

L., G. (2017, April 07). Brewing a strong social media presence: A Starbucks analysis. Retrieved May 20, 2018, from https://medium.com/rta902/brewing-a-strong-social-media-presence-a-starbucks-analysis-7a9f162db21f

Purewal, S. J. (2010, October 20). Starbucks Digital Network: First Look. Retrieved May 20, 2018, from https://www.pcworld.com/article/208369/starbucks_digital_network_first_look.html