8 P's of Starbucks and 5 Factors that influence the service quality in Starbucks

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MKT 321 ASPECTS OF SERVICE MARKETING

Introduction

Berjaya Starbucks Coffee Company Sdn Bhd is jointly owned by Starbucks Coffee International and Berjaya Corporations Berhad. The company operates Starbucks retail locations throughout Peninsular Malaysia and is committed to offer the world’s finest coffee while enriching Malaysians’ life one cup at a time. (Business & Company Resource Center, 2002)

Starbucks, with more than 15,700 stores in 43 countries, the most famous chain of retail coffee shops in the world, mainly benefits from roasting, selling special coffee beans and various kinds of coffee or tea drinks. (Business & Company Resource Center, 2002)

The first Starbucks retail store in Malaysia was opened in KL Plaza on the 17th of December 1998.  Starbucks stores may be found in urban and suburban areas, as well as many rural communities worldwide. In addition to well-situated stores, Starbucks sells coffee, tea, food and entertainment products through its specialty operations.

By the way, the Company’s performance has been further enhanced by the management’s acute understanding of target market needs and the provision of a correct product-mix.

Product and Elements

Starbucks’ products are expertly prepared by hand, made with the world’s best coffee and wonderful premium ingredients. Starbucks serves a variety of beverages including brewed , hot chocolate, espresso and . Starbucks also offers blended beverages which are the extension of the Frappuccino line targeted to the non-coffee drinker. (Business & Company  Resource Center, 2002)

Besides that, Starbucks supplements the beverage offerings with , ready-to-eat salads and sandwiches, muffins, and cakes.

Moreover, Starbucks also provide coffee-related retail items as well as an assortment of coffee and espresso-making equipment and accessories such as coffee grinders, coffee makers, espresso machines and coffee filters so their customers can create their own coffee in home. In addition, storage containers, travel tumblers and mugs will keep the drink hot and fresh for the customers as they travel.

Besides from drinks and foods, Starbucks also sell books, thermometer, Starbucks bear and latest compact discs through its Company-operated retail stores.

At the supplementary service, Starbucks provide free wireless internet access (Wi-Fi) to their customers.

Place

Starbucks stores are typically clustered in high-traffic, high-visibility location in each market. Recently Starbucks has 88 outlets in Malaysia.  Starbucks stores are located in a variety of settings, including office buildings, downtown and suburban retail centers, and airport terminals. (Business & Company Resource Center, 2002)

Starbucks also positions each store individually according to the specific location it is in. For example, Starbucks at Time Square shopping mall is definitely a strategic place. Consumers can feel very convenience to have a drink when they are shopping or relaxing at there. Moreover, this is a place that its focus will be on attracting high pedestrian street traffic because it is located conveniently at the centre of Kuala Lumpur and there has plenty of public transportation to reach there.

Additionally, the Company makes fresh Starbucks coffee and coffee-related products conveniently available via mail order and on-line. Starbucks publishes and distributes a mail order catalog that offers its coffees, certain food items and select coffee-making equipment and accessories, and the Company maintains a web site at com with an on-line store that allows customers to browse for and purchase coffee, gifts and other items via the Internet. The Company believes that its direct-to-consumer operations support its retail store expansion into new markets and reinforce brand recognition in existing markets.

Price and Other User Costs

Starbucks products always have been perceived with a prestigious image. With their high quality products, unique tastes, friendly environment, conveniences, customers are willing to pay a premium price for its products. Starbucks fiercely protects its pricing power because it knows a low-price strategy is the fastest pathway to commoditize and marginalize coffee back to being. Most importantly, Starbucks knows higher price will bring healthier profit margins, which fuel the cozy experience customers enjoy.

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Premium price is one of the key to differentiate Starbucks from other brands. Brand values of Starbucks could be as simple as the products itself. Either it could be the new coffee experience or Starbucks’s success on making its stores the ‘third living place’, after home and office. To justify its premium price, Starbucks has to deliver an effective experience such as create positive emotions and memories while deliver their target brand values.

Promotion and Education

Starbucks had done many range ...

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