Starbucks Case Study Answers

In: Business and Management

Submitted By bshw
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Starbucks: Delivering
Customer Service
I have neither given nor received unauthorized aid on this assignment
1. What factors accounted for the success of Starbucks in the early 1990’s? What was so compelling about the Starbucks value proposition?
The success of Starbucks in the early 1990’s can be attributed to Howard Schultz’s vision of the Starbucks brand. Schultz inspired of a company which would make the customer the centre of its success and would change the coffee drinking experience in the U.S. In order to achieve this, Schultz successfully utilized his human resources by establishing benefits that would force those resources to create value in the process of the coffee drinking experience.
Starbucks was successful because it placed value to the customers first in its value proposition. Following is a number of factors that accounted to Starbucks success in the early 1990’s:
a. Atmosphere: Schultz’s idea was to make Starbucks America’s “third place”. By recreating the Italian coffee culture he met in Milan, he managed to make Starbucks a place where people can enjoy their social interactions, relax, or just spent some time by themselves. In essence, the Starbucks idea changed the norm from “buying coffee as a drink” to “the experience of enjoying coffee”. People viewed Starbucks as a place they wanted to be at and they spent as much time as they could in the stores.
It was an uplifting experience that was complemented with the layout designed to provide an inviting environment.
b. Coffee quality: Starbucks strategy was to open only company‐owned stores and avoid franchising. This enabled the company to keep full control of quality of its products and services. At the same, Starbucks tried to control as much of the supply chain as possible in order to keep the quality of coffee at high and consistent levels by working with growers…...

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