The first Starbucks opened in Seattle, Washington, on March 31, 1971, by three partners who met while they were students at the University of San Francisco: English teacher Jerry Baldwin, history teacher Zev Siegl, and writer Gordon Bowker were inspired to sell high-quality coffee beans https://coffee.org/pages/history-of-starbucks. However, the question is how they managed to make Starbucks one of the most successful coffee houses of all time when there is such a competition out there. In this article I will be discussing my findings on Starbucks’ marketing mix- product, place, promotion and price to gain an understanding on Starbucks massive success.
Product. The main product of Starbucks of course is coffee however it is not the only product that is sold there. In this coffee house also are available baked goods, frappuccino and smoothies. It also offers special seasonal drinks. On top of that customers can buy their mugs and instant coffee what is especially delightful for real Starbucks coffee lovers. The company serves different client demands such as – lactose-free, gluten-free, vegan and vegetarian. The need for these products is growing and it is essential to be able deliver them and Starbucks successfully is running this market.
Place. Personally, for me the place is something more than being able to buy a product at certain point. From the place I am expecting positive experience, in this case a cosy atmosphere where I could enjoy coffee and maybe some snacks. Sometimes a coffee shop is a place that I could use to read a book or experience some level of socialization. From the experience I can say that the Starbucks shops are successfully fulfilling these expectations. However, it seems that to choose a profitable place is much more complex and analytical process. The data shows that Starbucks targets location with wealthier households https://towardsdatascience.com/analyzing-and-predicting-starbucks-location-strategy-3c5026d31c21, but is it enough to choose a location based on income? It was stated that at Starbucks studies an area before placing a store and bases its decision on demand, traffic and parking. Even more, when Starbucks CEO Howard Schultz was asked “Why is there such an abundance on Starbucks stores placed right next to each other?” he said that it is to reduce the lines and the waiting time for the customer. Certainly, this approach is working very well.
Promotion. What do you think about when hear the name Starbucks? When I hear this name, I picture it as something unique, qualitative, popular and a bit pricy amongst other coffee brands. Is it something you have in your mind when thinking about Starbucks? The company’s image was created by using methods such as- word of mouth marketing, advertising, sales promotions and public relations. As the Panmore Institute states “Starbucks became popular primarily through word-of-mouth marketing” http://panmore.com/starbucks-coffee-marketing-mix-4ps-analysis. Of course, to reach the level where customers are so delighted that they want to share their experience it is essential to deliver a great product and great service. Indeed, from my personal experience I can say that if there is something I really like and enjoy I will let the others know about it simply because I want for them to have a positive experience too.
Price. As it was discovered Starbucks uses premium pricing strategy. The idea of this approach is to offer a high-quality product for a higher price. However, there are studies that show that actually not all people would agree that the Starbucks coffee has the best quality. What is interesting that during the blind taste test it was discovered that the average American prefers Dunkin Donuts or McDonald’s coffee to Starbucks coffee https://www.business2community.com/customer-experience/buyer-psychology-customer-value-people-buy-starbucks-coffee-0995182.
So, then why so many of us chooses to go back there and buy another cup of coffee? It is because aside from getting a good product we aim to have an enjoyable experience. Starbucks is offering this experience through good atmosphere, relaxing music, great aromas and friendly ‘baristas’. I remember the first time I went to Starbucks; I was positively surprised that when taking my order, the barista asked my name and wrote it on a cup. When the order was ready, they called me by name. It made me feel welcomed and I came back afterwards.
What are the things that makes you go back to certain places? Is it the quality, experience or service? Do you make your purchases more based on emotional or rational approach?
Kristinekk 
This is a good overview of the marketing mix for Starbucks, you could potentially have expanded from the 5Ps to include the 7, notably, you talk about place but essentially cover physical evidence in the same paragraph. If you expanded to the 7 Ps you would have been able to showcase a deeper understanding of the mix. (Plus you’ve basically done the work to turn it into 7 already!)
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Great post. You did a lot of research and sed the most useful elements. Your application of the 4P’s of the marketing mix is really good. Customers’ loyalty is not only relying on the taste of the coffee, it is also about the Starbucks experience, I totally agree with your points. The fact that the baristas ask for you name is one of the selling points of Starbucks, it makes us feel special and singular. Well done Kristine!
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What an amazing story you’ve just fed me with! Loved every word of it even if I am not a coffee drinker by no means. I can draw a parallel with Costa Coffee where they didn’t call me by my name and was confused when my coffee will be done and where to take it from, can’t say I enjoyed the customer service much, but the americana with milk was okay – did drink most of it. I definitely go back for all three, quality, experience and service; often it is a combination of both emotional and rational, I know how they made me feel and the service was great and they have great products reasonably priced etc.
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You have a good understanding of starbucks’ marketing mix. I can learn a lot from it that I didn’t know before. The environment, service and coffee quality of starbucks are very good. Also drinking coffee at starbucks is a treat.
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