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Starbucks Corporation, an American company founded in 1971 in Seattle. Product mix includes roasted and handcrafted high quality/premium priced coffees, tea, a variety of fresh food items and other beverages. They primarily operate and compete in the retail coffee and snacks store industry. Starbucks and Dunkin Brands make up more than 60% of the market share. Their core competence has been their ability to effectively leverage their cornerstone product differentiation strategies by offering a premium product mix of high quality beverages and snacks.
What makes them different from other 1000 of existing brands is the brand equity they have built on selling the finest quality coffee and related products, and by providing each customer a unique “Starbucks Experience” therefore providing customers with the best hospitality and the ambience it provides to its customers.
1. What main internal features/ strengths (sets of activities or resources/capabilities) is Starbucks’ competitive advantage built on?
Ans. Being a coffee manufacturer or a retailer with a very innovative store is not a very difficult in today’s scenario.
But what competitive advantage Starbucks own over its other competitors are very diversified.
Firstly the supply chain management it follows, which helps company to get finest quality of coffee seeds from global suppliers at a most effective price. Secondly the brand image it has created over the period of time, which makes it a luxurious brand, which customers wants to not miss on. Also the cross relation it holds within the business.
When talking about Starbucks we cant just call it a coffee shop, because they are a experience store where they provide you with a third place experience, a place away from work And home where people can relax and gather ideas.
They also holds a edge when it comes to integration of technologies with Lastly, the global positioning advantage which it holds, they have their presence across the globe with the different blends of different culture involved in it. This positions them at a point where others are not even close to them when compared in global scenario. This are the competitive advantage which Starbucks has built on over the years, as compared to its other competitors across the globe.
2. What barriers to imitation (or replication) exist that will ensure that Starbucks’ competitive advantage will be sustained in the long run?
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