1. CASE study 2 Starbucks: Just Who Is
the Starbucks Customer?
2. Using the full spectrum of segmentation variables, describe how
Starbucks initially segmented and targeted the coffee market.
Applying the above spectrum we can get the following segmentations
3. •femaleslargerthanmales
•age 24-44
•income more thanavarage
•predominatelyCaucasian
•(The typical customerwaswealthier,bettereducated,andmore
professionalthanthe average American.The customerwasfarmore
likelytobe female thanmale,predominatelyCaucasian,andbetween
the ages of 24 and 44)
•“thirdplace”— a place awayfrom home andwork
•middle upperclassclients
•the ideaof makinf alternate lifestyle
•inthe veryearlystatrt (justa handful of coffee shopsinSeattle)
•choosingthe crowdedareas(Inone stretchof crowdedManhattan,a
personcouldgettheircaffeine fixatanyof five Starbucksoutletsin
lessthana blockand a half.Infact,crammingso many storessoclose
togethercausedone satirical publicationtorunthisheadline:“A New
StarbucksOpensinthe Restroomof ExistingStarbucks.”)
•apreciate Quality
•appreciate Service style
•StronglyLoyal
•EverydayUser
•It wasthis customerwhofell inlove withthe StarbucksExperience.
She was veryloyal,oftenvisitingastore everydayor evenmore than
once a day.
4. What changed first—the Starbucks customer or the Starbucks
Experience? Explain your response by discussing the principles
of market targeting.
The rapid & massiveexpanding for Starbucks has eventually make them meet
with many types of customer that the segmentation & targeting was not suitable
for
So the experience changed firstand that cause the customer to be changed
Quotes from the book as follow to indicate the changing in experience
“But the more Starbucks grew,the more the Starbucks Experience began to change.With more stores,the place
wasn’tquite so special.As each location filled with more customers,baris tas had more names to put with faces.As
the menu expanded with more options,the number of combinations for coffee drinks grew into the hundreds,leaving
baristas less time to chatwith customers.As the atmosphere in each store turned to “hustle and bustle,” it became a
less attractive place to hang out. “
Also quoted fromthe book to see the changein customer as an effect
“With all these changes,Starbucks progressivelyappealed less to the traditional customer and more to a new
customer.This customer shiftwas inevitable;there simplywere not enough traditional customers around to fuel the
kind of growth that Schultz sought.The new breed of customer was less affluent,less educated,and less
professional”
“To the new breed of customer,it meantgood coffee on the run. It was a place to meetand then move on. The more
accessible Starbucks was,the better. Speed of service was more importantthan a barista who wanted to talk current
events. This new customer came in much less frequentlythan the traditional customer,as seldom as once a month”
5. Based on the segmentation variables, how is Starbucks now
segmenting and targeting the coffee market?
6. The above shows the go for 1- demographic the 2- geographic then last is
psychographic
• gender : both
• age wide varaity
• all races
• all education
• all income by intreducingcheaper coffee
• lower classes
• world wide
• many locationsserving one city
7. Will Starbucks ever return to the revenue and profit growth that it
once enjoyed? Why or why not?
As a guess YES
As they have gone for new segments & new targeting with new
strategy to work such as
the new strategy centers on Via, an instant coffee that Starbucks introduced lastyear. It is available in single
serve
packets at all Starbucks stores and in grocery stores at$1 each or $9.95 for 12 packs.Via lets Starbucks promote a
genuine cup of Starbucks coffee for under a buck
Starbucks strategy also focuses on the grocery business butthrough ground-flavored coffees.
Starbucks is partnering with Kraft to launch flavored coffees you can brew yourself. Sixty percent of bagged
coffee buyers are either drinking flavored coffee or adding flavored creamer.
Also the rebranding strategy done
