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Starbucks is one of the most popular bistros to come a long in America in the twentieth century. Since it’s existence, it excels at providing impeccable products and service. In 1971, Starbucks Corporation was founded by Gordon Bowker, Jerry Baldwin, and Zev Siegl in Seattle, Washington. (Loyd, Jackson, & Gaulden, 2001). Once the first store proved to be successful, they opened a second store in University Village, Washington. Starbucks began the distribution of coffee at wholesale for their business model. Starbucks expanded its horizons in 1993 by successfully coming to a business agreement with Barnes and Noble on the East Coast of Washington.
Starbucks had an idea of selling their coffee in bookstores where Americans would go and spend quality time reading books. (David, 2013). After Howard Schultz purchased Starbucks Corporation, in 1987, he became Starbucks leader as the new CEO and Chairman. In addition, Schultz had a brilliant idea, much like Ray Crock, formerly McDonalds’s founder in 1987 to expand by opening 125 new stores in the market and convey high results for investors within the company.
Howard Schultz decided to keep the official Starbucks brand name for competition purposes only, because Starbucks name already had extremely high value in the market. According to Howard, having a name people could remember, recognize, and relate to provides enormous equity (Loyd et al., 2001, p. 42). The Starbucks managements team idea was to continue on opening up more and more local stores as they intended then to expand their service forces worldwide by opening over more than 4,000 new store locations globally.
Schultz’s brilliant vision, mission, and leadership guidance were to inspire employees and Starbucks investors to drive the brand in a healthy financial avenue and to continue growing its venture capital investment overseas (Loyd et al., 2001).
Starbucks primary target market are men and women aged 25 to 40. Those men and women account for 49 percent of Starbuck’s total business. Starbucks appeal to their consumer base through current and modern decore that is dependable in its displaying and design and working to keep its products relevant. Most customers tend to be natives with moderately high income, professional careers with a focus on social welfare.
The young adults age 18 to 24, which is a total of 40 percent of Starbucks sales. Starbucks positions itself as a the place where college students can hang out and socialize, study, write term papers and where they can meet new people. Starbucks can appeal to this consumer base directly through announcing technology as soon as it’s available, focusing on social networking and heavily cultivating a cool image.
Kids and teens are also a bigger part of Starbucks target audience than what most people think. Together, customers ages from 13 to 17, can account for just 2 percent of Starbucks sales, but most items for kids are purchased from their parents. Kids go there with their parents; both mother or father and child leave with at least a cup in hand. They’re serving up tasty treats like their delicious cake pops, which I bought for my 1 and half year-old daughter. Teens meanwhile use Starbucks as a place to hang out with friends or to study. Starbucks may not cater directly to kids, but they do make kid friendly products for example, offering special child sizes.
Most of all, at the heart of their business, Starbucks seeks to motivate and nurture the human spirit. Starbucks tries to understand that each person brings a different life experience to the plate. Their partners are diverse not only in gender, race, ethnicity, sexual orientation, religion and age, but also in their cultural backgrounds, life experiences, thoughts and ideas.
Dunkin Donuts and McDonald’s have been jostling for position and market share for several years. The war is fought in several ways. First, geographically: Dunkin Donuts is traditionally based in Massachusetts but is forcefully expanding south and west. Starbucks first started in Seattle, but, like McDonald’s, it is now universal, with the market that is equally spread across America. The second way involves their consumer habits. The fast food breakfast market is obviously dominated by McDonald’s. Dunkin Donuts has notoriously positioned itself mainly as a place to go for coffee, while Starbucks controls the destination as a coffeehouse a place to work and socialize.
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