Costa coffee pestle analysis 2018

Running head: STRATEGIC PLAN 1

STRATEGIC PLAN 4

Strategic Plan

Purdue Global University

Constance Dent

Strategic Plan

Costa Coffee Company

Costa Coffee is global coffeehouse company that was started in 1971. Costa Coffee was initially owned by the Costa family before it was sold to Whitbread in 1995. The company was later acquired by The Coca-Cola Company on 3 January 2019 at a cost of $5.1 billion (Costa, 2019).

Costa Coffee Markets

The table below highlights the current markets where Costa Coffee operates.

Europe

Asia

Africa

UK

Poland

Russia

Spain

Ireland

Hungary

Czech Republic

Germany

France

Latvia

Portugal

Malta

Kazakhstan

Bulgaria

Lebanon

Jordan

Indonesia

Vietnam

Oman

Cambodia

Bahrain

Philippines

Cyprus

Kuwait

Saudi Arabia

Qatar

China

India

United Arab Emirates

Egypt

Morocco

Financials

During the 2018 Financial Year, Costa Coffee reported an annual revenue of £1,292 million representing a 7.5 percent increase in revenue from the Financial Year 2017. From this, the total revenue from United Kingdom was £1,131 million while the oversea branches made contributed £161 to the total revenue. The total return on capital was 46.0 percent (Costa, 2019).

Mission, Vision, and Value Statements

Mission: “To save the world from mediocre coffee” (Costa, 2019).

This mission statement strives to capture the attention of the target audience by making them understand that Costa’s coffee is unique from the common one found in the market. However, this statement fails to explain to people what the characteristics of mediocre coffee are.

Pros

· It helps people understand that the company’s coffee brand is unique and totally different from others.

Cons

· The mission statement is not sufficient since it does not tell people which brand of coffee is referred to as coffee.

Vision: “Our vision is to be the best hospitality company that there is – a family of related hotel, restaurant and leisure club brands recognized by our people, guests and investors as leaders in each market in which we operate” (Costa, 2019)

The vision is meant to place Costa as the helm of hospitality industry in the market, that is, Costa is simply the best. However, the fails to tell the customers what is it that they have that makes them the best in the hospitality industry.

Pro

· It gives the target audience an overview of the company’s major facilities

Con

· It fails to give the unique features of the company’s facilities in order to make them attractive to the target audience

Value Statement: “Our People are the foundation of the Costa business” (Costa, 2019)

This statement is meant to make customers feel appreciated and valued by the company –a good strategy of luring them to become loyal to the company. However, the statement is one way since it is meant to drive consumer loyalty without stating what the company intends to do in order to benefit the customers.

Pro

· It helps the company to make its key stakeholders feel appreciated

Con

· The company fails to highlight the key strategies it has adopted to make the key stakeholders feel appreciated.

Product Description

The company deals with:

· Cold drinks which includes fruit coolers and Frostino

· Cakes and pastries among them croissants, brownies, and cookies

· Hot drinks like coffees, hot chocolates, and teas

· Savory snacks such as breakfast and sandwiches.

Moreover, the company has a chain of coffee dispensing machines located in major shell petrol stations. These machines are known as Costa Express (Costa, 2019).

Brand and Product Features

The company deals with finer coffee that is unique and tasty in the bid to offer maximum satisfaction to consumers. Costa’s coffee comes in different flavors among them Americano, Cappuccino, Expresso, Flat white, and Latte. The company also has Costa Express machines which helps consumers to access our product at convenient points at any time of the day (Costa, 2019).

International Market

The company is intending to expand and extend its presence in the African market which remains highly unutilized. Currently, we are found in only two African countries –Egypt and Morocco. However, there is dire need to establish our branches in the Nigerian market. Nigeria is among the most successful countries in Africa with a GDP of $397.47 billion (Zahonogo, 2016). The country’s economic state offers a good opportunity for the company to invest there and get good returns. Partnership with major filling stations and local joints within the country will be a good strategy of trying to penetrate the new market. This will enable the company set up Costa Express machines which will be dispensing coffee for the customers at specific points identified by the company.

There are two major tools which will be used by the company to analyze the environment and make necessary moves which will be crucial to enable the company to venture into the new market successfully. These tools include SWOT and PESTEL analysis. There are a number of opportunities linked to the new market. First, the company will be able to grow its revenue. Secondly, by expanding to other countries like Nigeria, the company will be able to increase its market share in the hospitality industry (Živković et al., 2015).

Entering the Nigerian market will be advantageous since it will help the company increase market dominance, market share, as well as increase in sales. The disadvantages are the threats from terror groups like Boko Haram, political instability in the country, a lot of money required for the initial investment, as well as lack knowledge on the market dynamics in the country.