Starbucks Case Analysis

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Case Analysis of Starbucks customer service delivery and the Starbucks experience.

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  • The model you present is incorrect. Not all sub dimensions are relevant in context to each of the three primary dimensions.
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  • Starbucks has good coffee but let’s face it. The price they ask for it it’s a bit high. You should better invest in your espresso coffee machine and start making coffee from the comfort of your home.

    http://www.espressocoffeemachine.co
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  • Thanks for sharing info on Starbucks.

    Darren Mack
    www.lyricsringtones.org/
    www.shibidoo.com/
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  • Very interesting ppt. The research indicated PPT only contains 30% of information; therefore the 70% valuable information comes from the presenter himself/herself. soEZLecturing.com provides you a chance to record your voice with your PowerPoint presentation and upload to the website. It can share with more readers and also promote your presentation more effectively on soEZLecturing.com.

    www.soezlecturing.com
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Starbucks Case Analysis

  1. 1.         Starbucks: Delivering Customer Service  Group 16   Manish Ballal (19)   Niraj Kothawade (24) Sairam Iyer (34)
  2. 2.   What factors accounted for the extraordinary success of Starbucks in the early 1990s? What was so  compelling about the Starbucks Value Proposition? What brand image did Starbucks develop during  this period?  Factors that contributed to Starbucks’ success:  • Experiential branding strategy  • Reach  • Product variety  • Customer service  • High Quality Coffee  • Starbucks ‘ transformed coffee consumption from a picking behavior to an experience with high  credence attribute  Starbucks’ Value Proposition:  1. To create an “experience” around the consumption of coffee, an experience that people  would weave into their lives  2. To create an uplifting experience in “Customer intimacy”  3. To create an “ambience” based on human spirit, sense of community, and the need for  people to come together  Starbucks’ Brand Image:   Anywhere, everywhere, good coffee on the run captures Starbucks image completely.  Why has Starbucks CSI scores declined? Has it really declined or is it simply measuring the CSI the  wrong way?  As per the Service quality and customer satisfaction model, CSI can be measured in terms of following  parameters: 
  3. 3.   Customer satisfaction gap could primarily be attributed to a service gap between Starbucks scores on  key attributes and customer expectations.  As per above model, Starbucks is measuring customer satisfaction parameters which really do not fall  into CSI measurement category. Starbucks is measuring parameters that attribute to product quality  rather than service quality.   Thus, Starbucks is measuring CSI in wrong way.  Describe the ideal Starbucks customer from a profitability standpoint. What would ensure that this  customer is highly satisfied? How valuable is a highly satisfied customer to Starbucks?  For Starbucks, a loyal represents a profitable investment. Starbucks wants customers to return to the  store and spend time so as to ensure more consumption. To ensure customer loyalty, Starbucks needs  to focus on Interaction quality, physical environment quality and outcome quality.  
  4. 4. Qualitatively every customer is invaluable to Starbucks. But if we want to ascertain a quantitative  measure to satisfaction, value from a customer can be measured from Exhibit 9 as follows:  Value from customer = Number of Starbucks visits/month * Average customer life * Average ticket size       = 4.3 *4.4 *12* 4.06      = 921.7824  Should Starbucks make the $40 million investment in labor in the stores? Is it possible for a mega‐ brand to deliver customer intimacy?  Starbucks can come out with following plan of action as outlined below:  1. Proceed with investing the $40 million annually in the 4,500 stores to increase service efficiency  (impacting customer satisfaction.  Goal ~ customer retention in the competitive coffee house  market)  2. While the investment enables additional labor hours, research efforts to increase efficiency  through set‐up and equipment (e.g. automated espresso machine, specialized work stations)  3. Use secondary market research data to identify, analyze, and alter product differentiation  strategies, with respect to smaller chains and Starbucks obliquities  4. Alter the product mix depending on the store size and location of the outlet (demographics)  Sample to find out what customers mainly look for  • Sample data results would narrow the customization and train baristas with  • those special concoctions  5. Marketing Research showing that existing markets are far from saturation  6. Continue with Product and Service innovation, proactively conduct an environmental scan to  launch new products  7. Validate Market Research metrics and methods of sampling, data analysis  Service Performance categories  • Starbucks needs to find out whether the data translates in to measurable  • metrics that can impact sales and profitability.     

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