Starbucks Going Global

Strategic international marketing

Strategic international marketing combines most of the recent ideas, original research, and the trends in theoretical and practical global marketing. This is a subject that provides an integrated and strategic approach, placing international issues within a broader marketing management context.

Starbucks: A dominant multinational coffee-seller

In particular, Starbucks is a dominant multinational coffee-seller based in the United States. It is the largest coffeehouse company worldwide in 40 countries, with 13,168 stores. It sells espresso-based hot drinks, brewed coffee, hot and cold beverages, snacks, and coffee beans.

Challenges Faced by Starbucks

From the case study, one of the greatest challenges the gigantic company encounters is increased competition from similar if not identical retailers with a possible lack of adequate experience in dealing with its business in a price-sensitive market. Starbucks often struggles to keep up with its position despite the undying competition but still seems difficult for its able competitors. This is because of the lead-time that Starbucks has had to develop to form all of its alliances with Dreyer’s Grand Ice Cream, Barnes & Noble Booksellers, Capitol Records, Pepsi-Co, and Nordstrom to expand its product and distribution portfolios.

Another challenge is complicated employee training and supply chain. Here, investors easily overlook the bolts and nuts of carrying out a business strategy, but most important is the execution of the strategy’s success (Meissner 71). Starbucks is adding several complications to the training of its employees and the chain of supply by introducing La Boulange to its stores when it adds to the logistical complexities that come with the expansion of store inventory, Starbucks ever-expanding menu can lead to problems in its execution.

Furthermore, the company suffers greatly from the overload of choice. An abundance of choice is one of the by-products of Starbucks’ expanded food and beverage menus. This, as it sounds, is good for the consumers. However, it turns out that most customers prefer fewer choices to many choices. Research showed that most consumers are likely to make a purchase when offered five choices rather than 20 choices. By providing customers more options, Starbucks is making decisions more complicated and lowering the satisfaction of purchases. This, in turn, slows down the line leading to more deliberate service-provision and lower satisfaction. Starbucks may grow by adding menus and options but will eventually have to down it to focus on what the consumers enjoy most.

Current Challenges

Despite having had these numerous problems in the past like ten years, Starbucks has now fewer challenges to face with the CEO, Howard Schultz. The new management will only be needed to focus on three broad issues to have Starbucks more powerful. First is the challenge of mobile order and pay. This is a system that was invented by the former CEO but failed to implement the part of paying, carrying, and going as long lines are causing slower services. Howard is, therefore, supposed to focus on delivery before anything else.

Besides, the company finds it difficult to address the needs of its customers by providing their cuisines. Despite the fact that Starbucks is primarily a coffee-seller, having food on the menu can keep customers visiting the place. Nevertheless, the problem is that of having so much food that most clients only get attracted to the food other than the primary product. The other challenge is that of always keeping the customer as the priority. Howard needs to not only deliver a beverage to the customers but also to place Starbucks as a favorite joint or meeting point besides the workplace and home. As Howard innovates, the company evolves, and he must majorly keep his focus on the customer.

Recommendations

Starbucks can solve its problems using several methods. First, it should engage in heavy campaigns to draw more customers from its main competitor Churchill’s. If drawing seems difficult, Starbucks should use its purchasing power to acquire Churchill’s. This will help get off the challenge of more competition from similar and identical retailers. The company can also try to diversify its product market through research and reduce the menu. This will assist consumers able to make choices and satisfactory purchases. In turn, this can help keep and attract more consumers, making the corporate grow further. In addition to this, Starbucks could start lining children’s drinks and milkshakes, which would bring more families into the store.

Second, the company should rely on all types of media to advertise its brand. Notably, television and radio have distinct advantages just like any other media for advertisement message delivery. Apart from these two, magazines, newspapers, and the internet form part of the five types of media that form the traditional media. All companies build ad campaigns that have to be delivered by one of these media, especially television and radio for efficient communication with the expected audience. One of the metric measures that make television so successful is its level of reach. Despite the high costs of airing an ad on television, advertisers have the best chance of reaching their target audience. There is also the art of creativity. Due to its visual elements, such print, and dynamic movement, creativity is achieved at its best. With all these, you can create incorporate characters and emotional connections that can be related to the then audience and achieve multi-sensory appeal. Radio is a metric measure of a low-cost way of campaign marketing and has the most timely ad placements.

Third, the company must rely on social media and other online platforms to promote its products and services. An ad can be resounding by attracting thousands of customers who are new and full of interest, or it can be seeming dud, hence being a waste of time and money to you. Several metrics can measure online campaign marketing effectiveness. The metrics include the number of total visits to locations relevant to your strategy, the total number of new sessions which will tell you how sticky the site and how effective the outreach effort is (Su 180). In addition, there is the bounce rate, which is the rate at which new visitors leave your site without further exploration. Together with these are a total number of conversations, customer-retention rate, and customer value and lead to close ratio.

Lastly, the company should focus on improving its marketing strategy. Starbucks, as a corporate, is to establish itself as the best and super seller of the finest coffee in the world. It promises persistence to profitable sales and diversifies itself. Through its joint venture partnerships, it also produces bottled Frappuccino coffee drinks and premium Ice Cream lines. The company’s primary objective is to emerge as the most recognized and respected brand worldwide. It can be recommended for Starbucks to use its purchasing power to acquire its competitors.

Works Cited

Meissner, Hans G. Strategic international marketing. Springer Science & Business Media, 2012.

Su, Allan Y., Wen-Bin Chiou, and Ming-Hsu Chang. “The impact of western culture adoration on the coffee consumption of Taiwan: A case study of Starbucks.” Asia Pacific Journal of Tourism Research 11.2 (2006): 177-187.