Essay on Starbucks’ Strategic Framework

An international corporation, which has gained the “Great Place to Work” Award for credibility, was founded in Seattle’s Pike Place Market in 1971. For 25 years, Starbucks Corporation was well-known for its different types of coffees, premium teas, and beverages in the North America only; but, since 1996, when the first overseas coffeehouse was opened in Tokyo, Japan, the number of outlets has already come to 10,000 locations and more than 117,000 workers worldwide. It does not stand still even now: every day the corporation opens 5 new stores overseas. They are proud to be among the Fortune’s 100 Best Places to Work and, for the fourth time, to be one of Business Ethics’ 100 Best Corporate Citizens. Starbucks Corporation states that every partner/worker has a voice and this statement sets a feeling of dignity and solidarity, which makes them work better and, thus, brings them to a higher level of quality and quantity.
In 2005, the corporation’s income increased by 22 percent for thirteen weeks and was measured in billions of dollars. What is a core factor of Starbucks’ success? The following objective is a company’s overview:
“The Company’s objective is to establish Starbucks as the most recognized and respected brand in the world. To achieve this goal, the Company plans to continue to rapidly expand its retail operations, grow its specialty sales and other operations, and selectively pursue opportunities to leverage the Starbucks brand through the introduction of new products and the development of new distribution channels” (paras. 1, 2).

Essay on Starbucks' Strategic Framework help

Help With Essay on Starbucks' Strategic Framework

According to the Product/Market Opportunity Matrix, the company has gone through all growth strategy processes.

Market Penetration: Since 1971, Starbucks was selling same products (different types of finest coffees), provided balance of quality and price, and supported its non-smoking policy in the North American Market. The company has changed incidental clients to regular clients, and regular clients to heavy clients. At this stage, Customer Relationship Management succeeded to gain a word-of-mouth popularity for the company.

Market Development: having regard to cultural differences, the company started selling the same products overseas in 1996. Strategic Management took into account the comments of local partners and workers and this feedback showed the best scheme of development.

Product Development: At present, Starbucks adds to its finest coffee a variety of hand-crafted beverages, Frappuccino® and Frappuccino® Light blended beverage, DoubleShot® coffee drink, Tazo® teas, EthosTM Water, etc., baked pastries and, in some markets, a selection of high-quality sandwiches and salads. Besides, the company includes new services, such as selling of exclusive espresso machines and coffee brewers, unique confections and other coffee- and tea-related items.

Diversification: A rapid growth of the company on the international market has led to new products and services in local coffeehouses. The strategy was focused on the interpersonal communication between top and local managers and, at a present, the company becomes the most prominent, recognized and respected brands worldwide.

Moreover, according to the Boston Consulting Group Matrix, Starbucks Corporation is on the ‘stars’ position. This self sustainable company shows high growth worldwide and has enough cash to have a high share in the global market. It promotes and expands its products and services, and invests in the Research and Development. During the market development stage with high growth and low share, Starbucks was on the position of ‘question marks’ – it had to invest cash to gain a leading role in the market share. On the stage of product development, the company had low growth and high share – the cash was invested to make new products for the future high growth.

Finally, Starbucks Corporation has shown that it is ready to implement new products and services overseas, as well as nationwide. Besides, the company should give its management team and leadership the credit of the finest quality of its products. This work shows that the Strategic Management of Starbucks is still going on.

Works Cited:
“The Company Overview”. Starbucks Corporation. 28 Sept. 2006. .

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