Starbucks is considering entering the Venezuelan market. The presentation discusses Starbucks' background and mission, an overview of Venezuela's economy and demographics, and how Starbucks would adapt its marketing mix to Venezuela. It proposes adapting products to local tastes, establishing a distribution system, using various promotional channels, and setting prices in relation to the exchange rate and competition. A timeline and long-term planning are also discussed.

1. Presented by:
Alex Arellano
Luis Mendoza
Maurice Hinrich
Thomas Dimitriou
November 21, 2013
Practicum #8
Bus 306-01
Starbucks
Entering a Foreign Market

2. Agenda
1.
2.
3.
4.
5.
6.
7.
Company Background
Introducing Venezuela
Marketing Mix
Integrating The Four P’s
Timeline
Long Term Planning
Learning Outcomes

3. Company Background
•Established in 1971 in Seattle’s Pike Place Market
•The largest coffeehouse in the world
•Operates in 62 countries
•Current stock value is $80.15
•“Our mission: to inspire and nurture the human spirit – one person, one
cup and one neighborhood at a time.”

4. Venezuela
USA: GDP: $15.94 trillion (2012 est.),
Country comparison to the world: #2
Tax: 15.6% of GDP
Population below poverty line: 15.1% (2010 est.)
Median Age: total: 37.2 years
Male: 35.9 years female: 38.5 years (2013 est.)
Venezuela: GDP $408.5 billion (2012 est.),
Country comparison to the world: 34
Tax: 28.7% of GDP (2012 est.)
Population below poverty line:31.6% (2011 est.)
Median age: total: 26.6 years,
Male: 25.9 years female: 27.3 years (2013 est.)

5. Marketing Mix

6. Product
Product is the value(s)
that Starbucks can offer to
customers
• variety of drinks
• beans sourced from all over
the world
• strong brand recognition
• great atmosphere

7. Product Adaptation
•Ta s t e a n d a t m o s p h e r e
•B r e a k f a s t c o m b o
•D u a l p r o d u c t a d a p t a t i o n

8. Place
The place involves aspects of transporting and storing goods and how to make
them available to the customer. An adequate distribution system is essential.
Distribution:
- Caribbean coast roughly 9 miles away from Caracas
- Major distribution via ports of La Guaira and Puerto Cabello and the
international airport of Maiquetía
- 3rd most dangerous city in the world, including risk for piracy and robbery
- No regulations on distribution which allow suitable distribution system
- National agriculture allows purchase of local coffee beans and other related
ingredients

9. Channel
Export
Contract
Manufacturing
Direct Sales

10. Price
The amount of money charged for a
product or service.
•
Must reflect a supply and demand relationship
•
Fixed &
Variable
Cost
Competition
Objectives
Positioning
Most important element of the marketing mix
•
Only mix that generates a turnover for the
organisation
Target
Group

11. Promotion
Personal
Selling
Sales
Promotion
Advertising
Public
Relations
Promotion
Direct
Marketing

12. Integrating Price
• Adopting pricing strategies
Pricing Strategies
•$ 1 = 6 . 2 9 Ve n e z u e l a n B o l i v a r s
•S m a l l c u p o f c o f f e e $ 1
•S p e c i a l t y d r i n k s $ 3 . 7 5
Bundle
Pricing
Customer
Value-based
Pricing

13. Integrating Product
•Ta s t e / q u a l i t y s a m e a s o t h e r S t a r b u c k s
•R e n o v a t i o n , d e c o r a t i o n p l a n n i n g s t a r t s m i d - M a r c h a n d f i n i s h e s
by September
•S o l d a t t h e r i g h t p r i c e
•R i g h t p l a c e
•H i r i n g / Tr a i n i n g

14. Integrating Place
- Va r i a b l e c h a n n e l s :
-Medium trial agreements with clear
performance objectives
-Register within 60 days of incorporation
with the Superintendency of Foreign
Investment (SIEX)
-Foreign companies are permitted without
restriction to purchase real estate

15. Integrating Promotion
•M e d i a
•R e a c h i n g c u s t o m e r s
•H e a v y o n a d v e r t i s i n g , s o c i a l w e b s i t e s , s a l e s p r o m o t i o n s
•S e l e c t i n g t o u r i s t s , u p p e r c l a s s
•M e s s a g e
•T h r e e e f f e c t i v e k e y s t o c o m m u n i c a t e m e s s a g e
•A t t e n d S t J o h n t h e B a p t i s t f e s t i v a l

16. Timeline
location

17. Long Term Planning

18. Sources
•C e n t r a l i n t e l l e g e n c e a g e n c y. ( n . d . ) . R e t r i e v e d f r o m
h t t p s : / / w w w. C i a . G o v / l i b r a r y / p u b l i c a t i o n s / t h e - w o r l d - f a c t b o o k / g e o s / v e . H t m l
•D o i n g B u s i n e s s i n Ve n e z u e l a . ( 2 0 1 1 ) . C o m m e r c i a l g u i d e f o r u s c o m p a n i e s .
Retrieved from
h t t p ://phot os.State.Gov/ libraries/ venezuela/1945 2/pdfs/2011 _ _doing_business_in_venezuela.Pdf
•K o t l e r , P. , A r m s t r o n g , G . ( 2 0 1 2 ) . P r i n c i p l e s o f m a r k e t i n g . N e w Yo r k , N J : P r e n t i c e
Hall.
•People of Venezuela. (n.d.). In Republica de Venezuela. Retrieved from
h t t p : / / w w w. R e p u b l i c a - d e - v e n e z u e l a . C o m / a b o u t - v e n e z u e l a / p e o p l e ofvenezuela.Php
•Pricing Strategies. (n.d.). In Learning marketing. Retrived from
h t t p : / / w w w. L e a r n m a r k e t i n g . N e t / p r i c e . H t m
•Revision Theory. (n.d.). In The times100 business case studies. Retrieved from
http://businesscasestudies.Co.Uk/business - theory/marketing/marketingmix-price-place-promotionproduct.Html#axzz2lfdhg900
•Starbucks is Looking South. (2002, August30). Retrieved from
http://articles.Latimes.Com/2002/aug/30/business/fi -starbux30
•S t a r b u c k s H o m e . ( n . d . ) . R e t r i e v e d f r o m h t t p : / / w w w . s t a r b u c k s . c o m

19. Learning Outcomes
International
Trade
Factors
International
Market
Approach
Marketing
Mix
Adaptation
Corporate
Structure