Report on How to compete with Starbucks

The mechanism of Starbucks provides you access for two areas of competition among smaller and independent coffee shops. In a wider spectrum they are mostly quality and culture

In respect to the product quality the primary goal of Starbucks is continuity.  Their process of roasting and brewing are structured and crafted so that each cup of coffee provides same taste to the consumer. The major differentiation among a normal coffee shop and Starbucks is to provide espresso that costs more of a medium roast.

The styles that Starbucks offers to its consumers is hard to pull off and If you can train the employees to provide same sort of a style then you have another way to contrast yourself from Starbucks.

The other area to compete in with Starbucks is culture. This is a part of the business which is not that much strong but there are few things to be noted. The customer service offered by Starbucks have been really good. In order to compete with them same quality shall be provided to your customers

Question 2- smell in the cup:

In every type of business, it is very much important to pay attention to your customers and look after their comfort and provide them with the best available products. As an owner of a café you have to keep your ears to all the receiving feedbacks in between corresponding to the issues as well which includes behavior of employees. The handling of the crockery which is being used to serve the customers. Taking care of the goods which are being used and keeping a close eye on the inventory. Further the owner needs to realize that the customers service does not only involves keeping a smile on your face but it also includes listening to the customer this is the reason why you should ask your worker to accept the feedback and also you should be open to feedback receiving from your employees. Sometimes it’s very critical to keep an eye on the operations because it can affect the whole image of your business. One bad review in this time of social media can clearly bring down your sale to a greater extent. So, this the reason that your policies regarding customer clear should be transparent and sometimes there is a chance you might be doing something which is not very useful or in other instance your workers might have an idea that could really help in improving the experience of the customer

Question 3- Franchise consistency issues:

In order to coup with a scenario like this it is necessary to undergo a brief examination at the kitchen where the product is being prepared and there is a high chance that the reason for the problem is to be found there. Further it is necessary to look into the inventory and do a deep examination on the incoming of the materials in both branches. If there is any change in the supplier side it needs to be addressed at immediate basis. The other level come into examining the workers of the kitchen which includes chef and side chef. They should be aware of the issue and there is a chance that they can overcome it by corresponding among the chef of other branches. The process of preparing the product needs to be same among all the branches to deliver same quality of taste. SOP’s should be made in order to ensure the process being followed is the same, and in last the manager of operation should be highly attentive and be open to feedbacks. 

Question no 1:

Value preposition statement:

The customer value preposition or CVP is something that the organization promise to their customers and thus increase the customer engagement. If we look from the angle of organization, it focusses on creating extra values that is related to the product or services as a part of unique selling preposition. And from the perspective of customer, it emphasizes on extra values that will be represented by the product or the services. And so, the customer will respond through his/her purchase. The customer value preposition should inform everything about the business from marketing strategy point of view.

Benjy’s – spend money on desirable goods

There are many apps that help us in saving money while comparing price different products in a wide range. But a lot of products make us confuse and their almost equal prices make us wonder what product will help us in good run and may be less but we will not waste our money. Spending money on something should be the product that is worth it. Our store is giving you the opportunity that we limited the margin of the products to only those products which are good enough in quality and applications and the money they offer are totally worth it. We are committed to our customer desires and you can totally trust us in this. We are giving you best of the products and services with reasonable guarantee on each product. In the way that you can save your time searching and comparing while ending up wasting money on products that are not worth it.

The target market for this value proposition

While preparing the value preposition, the target audience should be in mind that who are the people you are selling your products to. What is their mentality, what they want, what they are looking for? Raise problem in their mind and at the same time give them the solution for that problem. Try to reach their emotions to the product they are going to buy. With respect to this case study the target audience are those people who are coming in showroom in order to compare price with different websites and apps like amazon. The employee who is dealing with them should not be rude that why they are doing so, instead of that he should make them aware about how showrooming is better then webrooming. Hit those points in their mind which are confuse. Remove their confusion by telling them how this showroom is giving good reasonable range, tell them that you have studied everything about the products and customer can ask anything from you. Tell them that how choosing from these products can save their time as well as money. And that the money they are going to spend will give them the real fruit from these products.

Question no 2:

SWOT analysis for Benjy’s

Internal factors

Strengths of Starbucks:

Ø  Generating regular traffic of the customer through much spending on advertising

Ø  Have widest and good selection of the products throughout the market range

Ø  Long time and loyal employee that are committed to their tasks

Ø  Products last longer and prices of the products are totally affordable

Weaknesses of Starbucks:

Ø  Showrooming has been a growing concern for Benjy’s. Online competitors like Amazon whose lack of brick-and-mortar presence allowed them to offer products at discounted prices making it very enticing for customers.

Ø  As a retailer, Benjy’s lacks differentiation in its products selection and also lacks exclusive distributorship which made them prone to be targeted by online retail giants such as Amazon who can sell the same products they offer, and being a cost leader at that because of the lack of physical stores and high market reach.

Ø  Benjy’s has no answer to these issues as of the moment and continues to suffer the losses which threatens them to go out of business with huge quarterly loss reaching to $700 million

External factors of Starbucks

Opportunities of Starbucks:

Ø  The local economy and population are growing so the local market dominance is quite possible.

Ø  99 percent of the transactions are from the stores and less than one percent are online

Ø  Trade area is sizeable outside of the local market with the population of about 5 lacs within drive of one hour

Threats of Starbucks:

Ø  The number of people who are shopping online is increasing so the people are leaving the stores and compare prices online and buy products there

Ø  There is low local unemployment rate so it become difficult to find people who can work in less benefits

Ø  The average age of the customer is decreasing so the traffic of the customers coming in stores are becoming less with the people having more than average income.

Question no 3: In today era those businesses are successful that help the customers to deal with their daily lives and that will not come in between the ways of leading lives. Online searching is a habit that many of us had developed through passage of time because it helps us in making purchases. Especially for younger people who are connected digitally more than anyone else, they deviate from the habit of buying while visiting the retail outlets. The thing that can help retailer to gain what they had lost in market due to existence of online stores is going through the deep market research on the mentality and habits of the customer that help customer in daily life. Business now are more than selling, having revenue or servicing the product. The taste and needs of the people are continuously changing due to global financial crisis. The product shelf is reduced due to the introduction of new technology.

Marketing mix of Starbucks:

It can be defined as ‘putting right product, at right place, with the right price at the right time’ it may sound easy but this strategy requires way more hard work than usual marketing mix is an excellent way that can ensure the sale of the products. It helps in offering the products in right way

The four P’s

Product of Starbucks:

Product is something that can meet the needs of the customer. It is important for Benji’s to understand the problem and find keys to solve those problems through their products. The benefits that the products are going to give should be understood. Moreover, potential buyers of products need to be identified and understand their mentality and habits.

Price of Starbucks:

Price should cover the price of user that he expects to pay for the particular product. The price directly affects the selling there should be a perceived value for the products, it should not be more or less. So, this is important to see what customer sees that you are selling. If the customer value is positive, then the price could get higher as compared to its objective monetary value. If you see that the product has less value in eyes of the customer, then it needs to get underprice.

Promotion of Starbucks:

The techniques and strategies of marketing communication everything is included under promotion. It includes advertising, offers, public relations and sales promotions. It is important to have a difference of marking and promotion. It is just the aspect of communication of the whole function of marketing.

Place of Starbucks:

Place or the placement of the product and the store should be according to how the products will get to the customer. The key element of placement is distribution. What channel should be more suitable for the products is included in the strategy of placement. How the end user will get access to the products easily.