This case study will consider how market research has strengthened Starbucks entry into the Chinese markets. All of that promotion isn’t cheap. The target market of Starbucks includes both male and female customers, and a large bunch of these customers is mainly in the 25-45 age group. Its high prices reduce affordability for the consumers. It’s their mix of marketing media that makes their brand recognizable, and it’s the consistent message that comes across every time that makes them stand out. After this initial target market Starbucks has since realized that they could target specific neighborhoods and social classes. As a result, Nigeria is unlikely to be an attractive market for the company as it has such a significant proportion of its population below the poverty line. Why you must market to and reach your target audience. Starbucks has been extremely cautious on its target markets. Target Markets During the initial years, the target market of Starbucks included: Affluent customers Well educated customers White Collar Patterns The age of the target market was between 25 and 44. The first Starbucks Coffeehouse did not open until 13 years after the company was formed. Starbucks market cap as of December 15, 2020 is $120.78B . 2.2 Starbucks Coffee Company Ltd (UK) The world’s main retailer and roaster of expert coffee is the Starbucks Corporation of the US that Starbucks uses a large variety of channels to market their product from social media to TV spots and ads. Starbucks faces an uphill battle as it wades into tea market with iced teas push Leonie Roderick Starbucks is heavily pushing its Teavana iced teas range as part of a large-scale summer campaign, but will have to overcome sugar concerns and muted consumer interest around tea if it wants to succeed. When Starbucks completed its first IPO, it rebranded to the logo that it now uses in all its marketing efforts today. Reportedly, McCafé's strategy is to target 18-35 year olds of every race, and its customers at suburban and regional outlets are primarily female, aged 25-39, many of whom have young families. Plus purchase behaviors such as basket size, shopping trip time, and brand affinity EVOLUTION OF POSITIONING STRATEGY BY HOWARD SCHULTZ. Starbucks’ initial positioning strategy was ‘Authentic Coffee Beans’. Originally when Starbucks began they targeted the young college students, with slightly higher than average income levels. See Starbucks consumer demographics such as age, income, education and ethnicity. The main target market for the Starbucks are the clients who are ranging from the professionals, tourist and business people to college students and university students. Excludes alcohol. As a result, Starbucks successful entry into the UK market gave an increased expansion of Starbucks international market as the company entered the UK market in May 1998. Together, the big three hold 68.1% of the total branded coffee market share. Examples of how Starbucks has used market trend data, digital consumer feedback and in-store product testing are the launches of its dairy-free milk alternatives. Demographic Segmentation Starbucks„ main target market is men and women between the ages of 25-44, which accounts for almost half (49%) of its total business. Starbucks Isn't Done Growing in the U.S. Starbucks, had a total of 995 stores in the United Kingdom in 2019. The Starbucks go-to strategy was to bring the already established product in different cultural and geographical space into the new market — the coffee-culture deprived United States. Howard Schultz’s task was to closely observe how Italians treat the product and figure out a … High prices – For many middle tiers and working consumers, Starbucks’ offerings are more costly than McDonald’s and other coffee outlets. Adults. Starbucks is often professed as affordable luxury which on the other hand allowed premium for Starbucks products. The impact of COVID-19 on the coffee shops market, with a focus on consumers’ decision-making process. When Howard Schultz joined Starbucks, he wanted to grow the Starbucks’ market. Target Market. Starbucks’ primary target market is men and women aged 25 to 40. Starbucks has developed an internationalization strategy to enable the company to open stores and franchises in countries across the globe. Despite a brief pause in its domestic expansion during fiscal 2021, Starbucks sees plenty of room to add new U.S. stores … The UK coffee market is the fifth largest coffee consumer market in … Market research company Mintel reports that during the period from 2012 to 2017, overall sales of dairy-free milk alternatives in the U.S. grew 61 percent, with almond, coconut, and soy milk being the most popular types. Target market Since 1960’s, consumption of coffee in the U.S. has been trending down. Young adults, aged 18-24, are the next large group that Starbucks targets. ; Imitability of products – Starbucks doesn’t own the most unique products in the market. They account for almost half (49 percent) of its total business. that market research and to identify and evaluate the techniques that Starbucks has developed in the UK coffee market in the UK during the last five years. According to the National Coffee Association, about 83 percent of adults drink coffee in the U.S. How does Starbucks Cater to its Target Market? But rather than marketing to all two million of America’s coffee drinkers, Starbucks took a smarter, strategic approach with its PSL. Costa, Starbucks, and Caffè Nero are the main leading coffee shop chains controlling more than half of the total market. Coffee shops in the UK are increasing at a fast pace, reaching more than 20,000 outlets in 2015. Starbucks Weaknesses – Internal Strategic Factors. Different customers are more willing to pay for luxury good now more than ever. Key points included. Market research is at the core of many of the market entry strategies Starbucks is employing. They bring in about 40% of Starbucks' sales. Starbucks for Life means the winner will receive a daily credit for 30 years for one free food or beverage item at participating Starbucks stores in the U.S. The UK’s Coffee Consumption. The table below lists the SWOT (Strengths, Weaknesses, Opportunities, Threats), top Starbucks competitors and includes Starbucks target market, segmentation, positioning & Unique Selling Proposition (USP). The company’s strategy to enter the UK market can be described as one that provide latest trends in the coffee market to meet changing needs and demands of their consumers through Starbucks adopted marketing mix in the UK. As of 2020, Starbucks is one of the leading brands in the food & beverages sector. Market leader Costa operates 2,121 UK outlets, adding 129 units in 2016, and Starbucks and Caffè Nero operate 898 and 650 UK outlets respectively. The average age of Starbucks customers was 42 years, and the average income $90,000 and above in 2018. Starbucks has been very careful about its target market because for the last decade the consumption of coffee has been decreasing (Starbucks, 2016). Starbucks for a Year, 6 Months, 3 Months, or 1 Month will be fulfilled as a daily credit for one free food item or standard menu beverage during the time period specified, which can be redeemed at participating stores. One of the most important principles that Starbucks keeps to is caring for their customers. Starbucks’ appeal to this consumer age group through hip, contemporary design that is consistent in its advertising and decor, and working to keep its products current as status symbols. Starbucks changes its marketing mix over time as a way of responding to strategic challenges in the market, including competitive forces involving firms like Dunkin’ Donuts, McDonald’s, Burger King, and Wendy’s, as explained in the Porter’s Five Forces analysis of Starbucks Corporation. Providing the most comprehensive and up-to-date information and analysis of the Coffee Shops UK market including the behaviours, preferences and habits of the consumer. The chain doesn't have the exclusivity appeal of Starbucks, and caters to a larger, more diverse segment of the population that favors convenience, speed and lower prices. Starbucks holds the lion’s share in the U.S. coffee market at 40.1% followed by Dunkin Donuts and Tim Hortons. In order to implement these strategies, Starbucks has opened new stores in both existing and new markets (Willmott et al, 2010). As Starbucks is a premium coffee brand, it generally relies on its target market having a significant number of middle and high earners with disposable income to frequent its coffee houses. For the 7th year in a row, Costa has been voted the nation’s favourite coffee shop chain by Allegra’s independent panel of 5,000 consumers, ahead of Starbucks … Starbucks market cap history and chart from 2006 to 2020. Initially the target market was white collared, sophisticated people but with the passage of time new strategies evolved and low budget and class friendly outlets were established, while maintaining its initial strategy in its real form. It zeroed in on a much more specific audience. The innovative product range and the quality of service offered by the Starbucks chain which operates across the UK has increased its position in the target market as a brand which is a strong competitor to a new coffee shop in the Heathrow airport. Market capitalization (or market value) is the most commonly used method of measuring the size of a publicly traded company and is calculated by multiplying the current stock price by the number of shares outstanding. Starbucks has also segmented its markets by demographically and geographically selecting the store location with educated and coffee lovers (Dibb and Simkin 1996). 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