starbucks delivering customer service harvard case study analysis

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Starbucks: Delivering Customer Service

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Youngme Moon

John A. Quelch

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Starbucks: Delivering Customer Service – Case Solution

Starbucks is a major specialty-coffee brand in the North. Recent market research has indicated that the service level of the company is currently not meeting the expectations of customers. Thus, the company is discussing a plan to increase customer satisfaction by increasing the amount of labor in each coffee store and, as a consequence, increasing the speed of service. However, the plan would result in additional costs of $40 million per annum while the impact on the profitability of the company is unclear.

​Youngme Moon; John A. Quelch Harvard Business Review ( 504016-PDF-ENG ) July 31, 2003

Case questions answered:

• What factors accounted for the extraordinary success of Starbucks in the early 1990s? What was so compelling about the Starbucks value proposition? What brand image did the company develop during this period?
• Why has Starbucks’ customer satisfaction score declined? Has the company’s service declined, or is it simply measuring satisfaction the wrong way?
• How does the Starbucks of 2002 differ from the Starbucks of 1992?
• Describe the ideal Starbucks customer from a profitable standpoint. What would it take to ensure that this customer is highly satisfied? How valuable is a highly satisfied customer for the company?
• Should Starbucks make the $40 million investment in labor in the stores? What’s the goal of this investment? Is it profitable for a megabrand to deliver customer intimacy?
• Please summarize the case study “Starbucks – Delivering Customer Service.”
• Please identify the key challenges of the company.

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Starbucks: Delivering Customer Service Case Answers

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Company Background – Starbucks: Love Coffee, Love People

Starbucks was founded in 1971. Later, Howard Shultz took over. Its vision and mission are to “Make America’s third place, Establish as the most recognized brand.”

The company specializes in selling whole coffee beans and premium coffee beverages. Its target customers are the affluent, well-educated segment of the market. It has achieved immense success and has spent almost nothing on advertising.

The company’s experiential branding strategy has three components:

This branding strategy is based on the human spirit, a sense of community, and the need for people to come together.

Challenges Faced

One of the core issues the company is facing is that its services are not meeting customer expectations. It is mainly due to changes in target customers, decreasing age and income groups, and customers’ poor perception of the company. Most people reviewed the company as follows:

• Starbucks cares primarily about making money – Up from 53% in 2000 to 61% in 2001
• Starbucks cares primarily about building more stores – Up from 48% to 55%.

There is also the lack of a strategic marketing group – no chief marketing officer, as accepted by Day herself that ‘they were good at collecting market data but not disciplined in using this data.’

The company is challenged on how to link customer satisfaction to an increase in sales and profitability. Should the company roll out a $40 million plan to add 20 hours of labor a week? And how should the company differentiate itself from competitors?

Q1. What factors accounted for the extraordinary success of Starbucks in the early 1990s? What was so compelling about the Starbucks value proposition? What brand image did Starbucks develop during this period?

• To set up an expresso bar inspired by Milan’s coffee culture.
• The aim is to make it to America’s “third place.”
• They created an experience around the consumption of coffee.
• Employees were called partners. The company offered benefits, which resulted in the company’s partner satisfaction rate in the 80% -90% range.
• Stable prices and new products were launched regularly. The company also conducted R&D, in-store experiments, and market tests.

Compelling reasons for Starbucks’ value proposition and the brand image the company has developed

• They offered the highest quality coffee beans sourced from Africa, Central and South America, and Asia-Pacific regions.
• The company worked directly with growers.
• The company developed good customer intimacy.
• The ambiance makes customers stay.
• The company’s outlets are located in high-traffic and high-visibility settings.
• Brand strategy, “live coffee” mantra.

Q2. Why has Starbucks’ customer satisfaction score declined? Has the company’s service declined, or is it simply measuring satisfaction the wrong way?

• The current way of measurement does not capture the correct consumer profile.
• The decline in service level – trained only to please the affluent customers.
• Diluting value proposition
• The rising perception is that the primary motive is making money and building more stores.
• Very little image or product differentiation between Starbucks and smaller coffee chains
• The company has hundreds of combinations of coffee, leading to a larger service time and lower customer satisfaction.

Q3. How does the Starbucks of 2002 differ from the Starbucks of 1992?

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[Solved]Starbucks Delivering Customer Service Case Study Solution: 5 Questions answered

Starbucks Delivering Customer Service case study comes from HBR. A link to the original case can be found here . The case can be analyzed from the perspectives of marketing, sales improvement, and from a strategic investment point of view. The company is contemplating a strategic investment of $40 Mn to bolster its systems and process to cater to the needs of new customers. We can also analyze Starbucks delivering customer service case study from the standpoint of future organizational vision and reinventing a brand

For more such solved case studies as the Starbucks Delivering Customer Service case study, please follow the link

Starbucks delivering customer service case study summary

In 1971, Gerald Baldwin, Gordan Bowker, and Ziev Siegl established a small shop in Seattle’s market. The company excelled at selling whole Arabica beans to coffee purists, a niche market. In 1982, Schultz joined Starbucks. A few years later, Schultz purchased the company. After he ascended to power, new stores opened. Starbucks delivering customer service Case Study also narrates the story of the owners and their vision for the organization in order to deliver a unique customer value

The organization went public. Both whole-bean coffee and coffee with a higher price tag were sold at the stores. By 1992, Starbucks had 140 stores in the Pacific Northwest and Chicago and was competing favorably with smaller coffee chains such as Gloria Jean’s Coffee Bean and Barnie’s Coffee & Tea. In 2002, Starbucks was the most well-known specialty coffee brand in North America. The company’s annual sales and net income grew at a rate of 40% and 50%, respectively. The company had over 5,000 stores worldwide and over 20 million customers.

It focused primarily on marketing at the point of sale and in local stores. The slogan “live coffee” encapsulated Starbucks’ brand positioning. It demonstrated how vital it was to preserve the national coffee culture , which provided customers with a “ experience” comprised of the coffee, the service, and the atmosphere. They were all baristas and were referred to as “partners. ” They believed that if partners were satisfied, so would customers. Consequently, employee turnover was low. When a partner was hired, he or she was required to complete “hard skills” and “soft skills” training in order to connect with customers more effectively.

Several types of matrices, such as monthly status reports and self-reported checklists, were used to evaluate the performance of the service. In addition, they had a mystery shopper program known as “customer overview The shopper rated four “fundamental services.” The company’s goal was to become “the most recognizable and esteemed brand in the world.” Starbucks vice president Christine Day devised a plan to invest an additional $40 million per year in the company’s 4,500 locations. This equates to an additional 20 hours of work per week. They are unsure whether to believe what customers say about customer service and its impact on sales and profits.

Starbucks Delivering Customer Service case study: What Contributed to the exceptional positioning of Starbucks in the Coffee Segment?

The extraordinary success of Starbucks in the early 1990s can be attributed to Howard Schultz, who added value propositions to the company by enhancing its services and adding quality to them. Schultz believed that coffee drinking creates an experience in the customer’s mind known as “the third place.”

Contributing to Starbucks’ extraordinary success in the 1990s were:

Starbucks works directly with its growers to maintain the superior quality of its coffee beans, and because all of its stores are company-owned, they are able to maintain tight control over its products and services.

Starbucks trains its partners in both hard and soft skills prior to hiring them in order to foster positive relationships with its customers. They instructed their employees on how to interact with customers by smiling, making eye contact, and remembering their names and preferences.

• The Customers : Their ‘Just Say Yes’ policy encourages partners to provide the best service possible, even if it exceeds company regulations, and their three-minute serving time enhanced customer satisfaction.
• Partner satisfaction : Schultz referred to Starbucks’ employees as “Partners,” and the company provides even entry-level employees with health insurance and company stock as a form of incentive. They believe that customer satisfaction depends on the satisfaction of their partners, which is why the company has one of the lowest employee turnover rates in the industry as a result of their promotion strategy of promoting partners within their rank and approximately 70% of the company store manager was an ex-partner.
•  The atmosphere of Starbucks stores : Schultz’s intention is to create a drinking coffee experience, where people drink coffee not only for its taste and quality but also to enjoy the experience. It is a place where people come to relax and enjoy social interaction, which is why they have comfortable seating areas and the layout of their stores is inviting.
• Location of the stores: Starbucks stores are situated in high-traffic areas such as office buildings, shopping centers, and university campuses.

The store’s value proposition is so compelling because they provide high-quality premium coffee and services to their customers as a result of their highly controlled supply chain strategy. In addition, they serve additional menu items such as pastries, soda, and juice, and they regularly launch new products. They are so focused on their services that they are familiar with their customers if they frequent the establishment, and their attributes, ambiance, and seating environment are an added value proposition.

Starbucks Delivering Customer Service case study: What Factors led to the decline of Customer Satisfaction Scores in the Early 1990s?

The customer satisfaction rating for Starbucks has dropped as a result of a gap between the company’s primary attributes and the expectations that customers have for the brand. Paying a premium price for Starbucks did not make a whole lot of sense because the chain does not stand out in terms of either its image or its products when compared to other, smaller coffee shop chains.

Customers started believing that Starbucks had entered a money-making industry and that the company placed a higher priority on shop expansion than on their satisfaction. On many occasions, “service enhancement” and “service speed” were the areas that required the most improvement. Also shown in the presentation is the fact that 11.34 percent of people believe that improvements to the services they receive could make them feel more valued.

• As shown in Exhibit 10, the majority of respondents (83 percent) believe that maintaining a clean environment is an essential component in achieving high levels of customer satisfaction.

• Because seventy-seven percent of customers placed a high premium on convenience, Starbucks made it a point to open multiple locations across the country.

• Seventy-five percent of customers ranked being treated as a valuable customer as extremely important for the generation of customer happiness, and Starbucks partners made certain to remember their customers’ names, welcome them, and inquire about their preferred drink modification preferences, among other things.

Because of this, asserting that the company’s service has worsened in recent years would be an exaggeration, given that consumers continue to give Starbucks high marks in a variety of other categories. However, Starbucks is becoming increasingly concerned about the lengthening wait times.

Because Starbucks is more concerned with the value of its brand, expansion, and profit than with how customers perceive its coffee, the customer snapshot is not an ideal instrument for measuring customer happiness.

Starbucks Delivering Customer Service case study: How did Customer Transform from 1992 to the early 2000s?

The average customer in 2002 was younger than the average customer in 1992, and the average customer in 2002 had less education than the average customer in 1992.

•In 1992, Starbucks’ customers were mostly wealthy people, but by 2002, they also included people with lower incomes.

• The market research team also found that customers used stores, in the same way, no matter where they were or how they were set up.

• In the research, it was also found that the most frequent customers came in an average of 18 times a month, but the average customer only came in five times a month.

• The research team also found out that Starbucks’ customers had changed from wealthy, well-educated, white-collar women between the ages of 24 and 44 to younger customers with less education who wanted more options and took more work to please.

Is it advisable for Starbucks to Invest $40 Mn in its stores and staff? What is the rationale behind the investment and share a mathematical model to justify the investment?

The investment plan called for “relaxing the labor-hour restrictions in the stores” in order to increase the amount of available labor in each store by 20 hours per week at an additional annual cost of $40 million.

Starbucks Delivering Customer Service case study: Breakeven Calculations

Analysis of the Profitability of the Investment Plan Investment per Store = $40,000,000 / 5886 stores = $6795.8 per store

$172 is the revenue difference between customers who are satisfied and customers who are extremely satisfied.

For each location to be profitable, $6795.8 must be divided by 172, which equals forty customers. There are 570 customers who shop at each location on a daily basis.

For the company to become profitable, 40 of its 570 existing customers must be upgraded from satisfied to extremely satisfied. Therefore, Starbucks is recommended to invest $40 million in order to increase service speed and decrease the number of satisfied customers who become dissatisfied.

As there is a direct correlation between satisfied customers and loyal customers, this would result in the consumer base’s long-term commitment.

Starbucks Delivering Customer Service case study: The rationale behind the  investment

The objective of investing $40 million in labor was to maximize customer satisfaction by converting satisfied customers into highly satisfied customers, thereby increasing revenue. This was accomplished by increasing the level of satisfaction of satisfied customers. Exhibit 10 displays the results of the 2002 consumer survey conducted by Starbucks. According to the survey, approximately 65 percent of Starbucks’ customers consider prompt service to be one of the most important factors in determining their level of satisfaction with their Starbucks coffee experience.

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Starbucks: Delivering Customer Service

Starbucks: Delivering Customer Service ^ 504016

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Publication Date: July 31, 2003

The case 'Starbucks: Delivering Customer Service' is accompanied by a Video Short - available only to registered Premium Educators at hbsp.harvard.edu - that can be shown in class or included in a digital coursepack. Instructors should consider the timing of making the video available to students, as it may reveal key case details. Starbucks, the dominant specialty-coffee brand in North America, must respond to recent market research indicating that the company is not meeting customer expectations in terms of service. To increase customer satisfaction, the company is debating a plan that would increase the amount of labor in the stores and theoretically increase speed-of-service. However, the impact of the plan (which would cost $40 million annually) on the company's bottom line is unclear.

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Starbucks: Delivering Customer Service Harvard Case Solution & Analysis

Home >> Harvard Case Study Analysis Solutions >> Starbucks: Delivering Customer Service

Introduction

The paper attempts to provide the internal and external analysis of Starbucks through the implication of SWOT analysis, VRIO analysis, and Porter’s five forces model. The paper also attempts to provide the problem statement of the Starbucks case along with the value proposition of the company. Furthermore, the paper provides alternative suggestions to the problem while describing the pros and cons for each alternative. Lastly, the paper provides recommendations for solving the problem statement of the company.

Problem Statement

While increasing the brand image of the company, Starbucks have been focusing on growing its business by introducing new products. However, in the midst of rapid business expansion and increased retail stores, the company has become weak in satisfying its customers. The connection is lost between satisfying the customers and growing the business. Christine Day, the senior vice president of Starbucks has recommended that the company shall invest an additional $40 million to increase the labor hours per week which can ultimately increase the speed of service, and hence increase in customer satisfaction. Although, the plan met internal resistance, Christine Day has to present final recommendations to the CEO of the company to increase customer satisfaction.

Internal Analysis

SWOT Analysis

Starbucks is a well-established brand and its revenues have been increasing by 5% each year. The company has shown consistency in the quality of its brands which is why a perception is built amongst customers that it is the America’s third place after home and work. The work environment is valued by the company’s employees as Starbucks have the highest employee satisfaction rate by 80% to 90% while having the lowest turnover rate.  Starbucks have over 5,500 global stores and has a strong international presence.

Starbucks has been focusing more on growing its business due to this the company has stopped following its customers. The Company’s strategy has shifted from customer-oriented approach towards growth-oriented approach, which has resulted in the loss of customers and has increased dissatisfaction. The prices of its products were continuously rising due to which customers were switching from Starbucks to other low cost coffee houses after recession. . The company had no chief marketing officer due to which  Starbucks lacked the decision making ability in the marketing department. Moreover, the speed of service which was the core unique selling proposition of the company has declined.

Opportunities

The rising coffee consumption around the world has also increased the demand for Starbucks as it is considered a top brand and therefore it provides an opportunity for the company to expand in different countries. Rapid retail expansion from the company is an opportunity towards fulfilling the demand across the globe.

There, is a rising competition because of the increase of many specialty coffee shop offerings. Also, many specialty coffee producers have been offering coffee for a price better and lower than Starbucks. There is an image developed in the mind of a consumer that Starbucks care about their customers just to earn money. This image of commercialization has badly affected the image of the company because the company whose primarily concern has been customers’ satisfaction, was been turned away for making more money in the name of customer relationship management.

Starbucks Delivering Customer Service Case Solution

VRIO Analysis

The core competitive advantage of Starbucks against its competitors is providing the consistent product quality to its customers. For all these years Starbucks has gained the trust of its customers on the basis of product quality. The core competency of the company has been placed in the third row which illustrates that the particular strength is rare. However, it is not difficult nor costly to imitate. The analysis shows that the particular strength is also substitutable. By combining these factors, it is concluded that the company shall gain temporary competitive advantage and temporary competitive returns. Although, many companies have tried to apply the similar concept and business model as Starbucks , but have failed to deliver an exceptional product quality on regular basis. If the company continue to provide the same quality through many years then its customers would become loyal. Although, this was the reason why Starbucks did not fail in the economic downturn because it had set the approach in the mind of its customers that Starbucks is their third place after home and office..........................

This is just a sample partial case solution. Please place the order on the website to order your own originally done case solution.

Starbucks, the dominant specialty coffee brand in North America, must respond to recent market research that the company did not meet the expectations of customers in terms of service. To increase customer satisfaction, the company is discussing a plan that would increase the amount of labor in the stores and theoretically increase the speed of service. However, the impact of the plan (which will cost $ 40 million per year) on the company's bottom line is unclear. This event is accompanied by a short video for Premium Teachers to show in class. To view the video, or to show the students, click on the video icon. "Hide Youngme on the Moon, John A. Quelch Source: HBS Premier Case Collection 20 pages. Publication Date: July 31, 2003. Prod. #: 504016-PDF-ENG

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Starbucks: Delivering Customer Service

Subjects Covered Customer retention Customer service Market research Profitability

by Youngme Moon, John A. Quelch

Source: HBS Premier Case Collection

20 pages. Publication Date: Jul 31, 2003. Prod. #: 504016-PDF-ENG

Starbucks: Delivering Customer ServiceHarvard Case Study Solution and HBR and HBS Case Analysis

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Starbucks Delivering Customer Service Case Solution & Answer

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Starbucks Delivering Customer Service                                                           Case Solution 

What are the implications of estimating customer lifetime values?

Customer lifetime value has natural appeal as a marketing concept.In light of the fact that in theory it speaks to precisely how much every customer is worth in money related terms, and in this manner precisely how much a marketing department would be willing to acquire every customer, particularly in direct response marketing.

Lifetime value is commonly used to judge the suitability of the expenses of acquiring a customer. For instance, if a new customer costs $50 to acquire and their lifetime worth is $60, then the customer is said to be beneficial and acquisition of additional similar customer is satisfactory.

Advantages of Customer lifetime value:

• Managing customer relationships as an asset. • Determining highest level of investments to be made in marketing and sales activities. • Encourage marketers to concentrate on long term value of customers instead of investing resources in acquiring unprofitable customers with lower total revenue. • Implementing sensitivity analysis in order to determine impact by spending extra capital on each customer. • Optimized allocation of scarce resources for conducting marketing activities in order to achieve maximum return on investments. • Accurate basis of selecting customers and for decision making process regarding customer communication strategies. • Customer relationship management systems should be automated. • Customer loyalty must be measured by including factors such as (proportion of purchase, probability of purchase and repurchase, purchase frequency and sequence etc.)

Managing customer relationships by inputs (mergers and retaining cost) and outputs (profit) for every particular customer is that managers can prioritize their return on investments and thus, better differentiate customers by their respective benefits and cost figures. Customer lifetime value can be increased by several techniques; one of the major techniques is to increase customer satisfaction so that customer retention rate increases and as customers will start retaining, then there is a possibility that the business can improve its profitability. Moreover,increasing these factors looks easy however,they are not that easy and it takes a lot of effort to fully satisfy a customer and delight him/her always.

Starbucks can include basic necessities of life inside its stores. The basic necessities of the customer includes providing them with work stations where people can come have a cup of coffee and continue doing their office work and as a result easily to stay up to date with the rest of the employees. Similarly they can develop play areas with attendants for children where people can leave their children and do not worry about them and can carry on with their work with a cup of coffee. This would enable a sense of home at Starbucks and almost everyone can make use of it like office people, students and children. Therefore,as a result Starbucks can retain customers and customers would like to come again because they would be delighted with the experience that they would get by visiting Starbucks.

Moreover,Starbucks can introduce sensory branding as well and trigger all the five senses of a human being such as smell, touch, taste, sight and sound.

Smell: There should be a unique smell inside all of the premises of Starbucks across the globe which should be similar in every store and which complements its brand image and goes with it.Therefore,if a customer is brought blindfolded then still he/she can tell that they are at Starbucks just by the smell. Taste: Unique taste of coffee across the globe which no other competitor can make just for the sake of a unique selling proposition. The taste should last in the mouths of the customers for a long period of time and whenever they hear about Starbucks the taste buds should be overtaken by the unique taste of Starbucks………………..

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Starbucks: Delivering Customer Service

By: Youngme Moon, John A. Quelch

Starbucks, the dominant specialty-coffee brand in North America, must respond to recent market research indicating that the company is not meeting customer expectations in terms of service. To…

• Length: 20 page(s)
• Publication Date: Jul 31, 2003
• Discipline: Marketing
• Product #: 504016-EPB-ENG

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The case 'Starbucks: Delivering Customer Service' is accompanied by a Video Short - available only to registered Premium Educators at hbsp.harvard.edu - that can be shown in class or included in a digital coursepack. Instructors should consider the timing of making the video available to students, as it may reveal key case details.

Starbucks, the dominant specialty-coffee brand in North America, must respond to recent market research indicating that the company is not meeting customer expectations in terms of service. To increase customer satisfaction, the company is debating a plan that would increase the amount of labor in the stores and theoretically increase speed-of-service. However, the impact of the plan (which would cost $40 million annually) on the company's bottom line is unclear.

Learning Objectives

To explore the various meanings of the concept of "service" in the context of a company that is evolving in terms of both size and the composition of its customer base and to look at the links between "customer satisfaction" and a company's sales and profitability.

Jul 31, 2003 (Revised: Oct 5, 2018)

Discipline:

Harvard Business School

504016-EPB-ENG

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Email us for Any Case Solution at: [email protected] Starbucks Delivering Customer Service Case Study Solution Analysis Starbucks Delivering Customer Service Case Study Solution Analysis. Our tutors are available 24/7 to assist in your academic stuff, Our Professional writers are ready to serve you in services you need. Every Case Study Solution & Analysis is prepared from scratch, top quality, plagiarism free. Authors: Youngme Moon, John A. Quelch Get Case Study Solution and Analysis of Starbucks Delivering Customer Service in a FAIR PRICE!! Steps for Case Study Solution Analysis: 1. Introduction of Starbucks Delivering Customer Service Case Solution The Starbucks Delivering Customer Service case study is a Harvard Business Review case study, which presents a simulated practical experience to the reader allowing them to learn about real life problems in the business world. The Starbucks Delivering Customer Service case consisted of a central issue to the organization, which had to be identified, analysed and creative solutions had to be drawn to tackle the issue. This paper presents the solved Starbucks Delivering Customer Service case analysis and case solution. The method through which the analysis is done is mentioned, followed by the relevant tools used in finding the solution. The case solution first identifies the central issue to the Starbucks Delivering Customer Service case study, and the relevant stakeholders affected by this issue. This is known as the problem identification stage. After this, the relevant tools and models are used, which help in the case study analysis and case study solution. The tools used in identifying the solution consist of the SWOT Analysis, Porter Five Forces Analysis, PESTEL Analysis, VRIO analysis, Value Chain Analysis, BCG Matrix analysis, Ansoff Matrix analysis, and the Marketing Mix analysis. The solution consists of recommended strategies to overcome this central issue. It is a good idea to also propose alternative case study solutions, because if the main solution is not Email us for Any Case Solution at: [email protected] Note: This article is just a sample and not an actual case solution. If you want original case solution, please place your order on the Email. Please do check Junk/Spam folder of your E-mail for our reply, if not in Inbox.

Email us for Any Case Solution at: [email protected] found feasible, then the alternative solutions could be implemented. Lastly, a good case study solution also includes an implementation plan for the recommendation strategies. This shows how through a step-by-step procedure as to how the central issue can be resolved. 2. Problem Identification of Starbucks Delivering Customer Service Case Solution Harvard Business Review cases involve a central problem that is being faced by the organization and these problems affect a number of stakeholders. In the problem identification stage, the problem faced by Starbucks Delivering Customer Service is identified through reading of the case. This could be mentioned at the start of the reading, the middle or the end. At times in a case analysis, the problem may be clearly evident in the reading of the HBR case. At other times, finding the issue is the job of the person analysing the case. It is also important to understand what stakeholders are affected by the problem and how. The goals of the stakeholders and are the organization are also identified to ensure that the case study analysis are consistent with these. 3. Analysis of the Starbucks Delivering Customer Service HBR Case Study The objective of the case should be focused on. This is doing the Starbucks Delivering Customer Service Case Solution. This analysis can be proceeded in a step- by-step procedure to ensure that effective solutions are found. In the first step, a growth path of the company can be formulated that lays down its vision, mission and strategic aims. These can usually be developed using the company history is provided in the case. Company history is helpful in a Business Case study as it helps one understand what the scope of the solutions will be for the case study. The next step is of understanding the company; its people, their priorities and the overall culture. This can be done by using company history. It can also be done by looking at anecdotal instances of managers or employees that are usually included in an HBR case study description to give the reader a real feel of the situation. Lastly, a timeline of the issues and events in the case needs to be made. Arranging events in a timeline allows one to predict the next few events that are likely to take place. It also helps one in developing the case study solutions. The timeline also helps in understanding the continuous challenges that are being faced by the organisation. Email us for Any Case Solution at: [email protected] Note: This article is just a sample and not an actual case solution. If you want original case solution, please place your order on the Email. Please do check Junk/Spam folder of your E-mail for our reply, if not in Inbox.

Email us for Any Case Solution at: [email protected] 4. SWOT analysis of Starbucks Delivering Customer Service An important tool that helps in addressing the central issue of the case and coming up with Starbucks Delivering Customer Service HBR case solution is the SWOT analysis. The SWOT analysis is a strategic management tool that lists down in the form of a matrix, an organisation's internal strengths and weaknesses, and external opportunities and threats. It helps in the strategic analysis of Starbucks Delivering Customer Service Once this listing has been done, a clearer picture can be developed in regards to how strategies will be formed to address the main problem. For example, strengths will be used as an advantage in solving the issue. Therefore, the SWOT analysis is a helpful tool in coming up with the Starbucks Delivering Customer Service Case Study answers. One does not need to remain restricted to using the traditional SWOT analysis, but the advanced TOWS matrix or weighted average SWOT analysis can also be used. 5. Porter Five Forces Analysis for Starbucks Delivering Customer Service Another helpful tool in finding the case solutions is of Porter's Five Forces analysis. This is also a strategic tool that is used to analyse the competitive environment of the industry in which Starbucks Delivering Customer Service operates in. Analysis of the industry is important as businesses do not work in isolation in real life, but are affected by the business environment of the industry that they operate in. Harvard Business case studies represent real-life situations, and therefore, an analysis of the industry's competitive environment needs to be carried out to come up with more holistic case study solutions. In Porter's Five Forces analysis, the industry is analysed along 5 dimensions. • These are the threats that the industry faces due to new entrants. • It includes the threat of substitute products. • It includes the bargaining power of buyers in the industry. • It includes the bargaining power of suppliers in an industry. • Lastly, the overall rivalry or competition within the industry is analysed This tool helps one understand the relative powers of the major players in the industry and its overall competitive dynamics. Actionable and practical solutions can then be developed by keeping these factors into perspective. 6. PESTEL Analysis of Starbucks Delivering Customer Service Email us for Any Case Solution at: [email protected] Note: This article is just a sample and not an actual case solution. If you want original case solution, please place your order on the Email. Please do check Junk/Spam folder of your E-mail for our reply, if not in Inbox.

Email us for Any Case Solution at: [email protected] Another helpful tool that should be used in finding the case study solutions is the PESTEL analysis. This also looks at the external business environment of the organisation helps in finding case study Analysis to real-life business issues as in HBR cases. • The PESTEL analysis particularly looks at the macro environmental factors that affect the industry. These are the political, environmental, social, technological, environmental and legal (regulatory) factors affecting the industry. • Factors within each of these 6 should be listed down, and analysis should be made as to how these affect the organisation under question. 7. VRIO Analysis of Starbucks Delivering Customer Service This is an analysis carried out to know about the internal strengths and capabilities of Starbucks Delivering Customer Service . Under the VRIO analysis, the following steps are carried out: • The internal resources of Starbucks Delivering Customer Service are listed down. • Each of these resources are assessed in terms of the value it brings to the organization. • Each resource is assessed in terms of how rare it is. A rare resource is one that is not commonly used by competitors. • Each resource is assessed whether it could be imitated by competition easily or not. • Lastly, each resource is assessed in terms of whether the organization can use it to an advantage or not. • The analysis done on the 4 dimensions; Value, Rareness, Imitability, and Organization. If a resource is high on all of these 4, then it brings long-term competitive advantage. If a resource is high on Value, Rareness, and Imitability, then it brings an unused competitive advantage. If a resource is high on Value and Rareness, then it only brings temporary competitive advantage. If a resource is only valuable, then it’s a competitive parity. If it’s none, then it can be regarded as a competitive disadvantage. 8. Value Chain Analysis of Starbucks Delivering Customer Service The Value chain analysis of Starbucks Delivering Customer Service helps in identifying the activities of an organization, and how these add value in terms of Email us for Any Case Solution at: [email protected] Note: This article is just a sample and not an actual case solution. If you want original case solution, please place your order on the Email. Please do check Junk/Spam folder of your E-mail for our reply, if not in Inbox.

Email us for Any Case Solution at: [email protected] cost reduction and differentiation. This tool is used in the case study analysis as follows: • The firm’s primary and support activities are listed down. • Identifying the importance of these activities in the cost of the product and the differentiation they produce. • Lastly, differentiation or cost reduction strategies are to be used for each of these activities to increase the overall value provided by these activities. Recognizing value creating activities and enhancing the value that they create allow Starbucks Delivering Customer Service to increase its competitive advantage. 9. BCG Matrix of Starbucks Delivering Customer Service The BCG Matrix is an important tool in deciding whether an organization should invest or divest in its strategic business units. The matrix involves placing the strategic business units of a business in one of four categories; question marks, stars, dogs and cash cows. The placement in these categories depends on the relative market share of the organization and the market growth of these strategic business units. The steps to be followed in this analysis is as follows: • Identify the relative market share of each strategic business unit. • Identify the market growth of each strategic business unit. • Place these strategic business units in one of four categories. Question Marks are those strategic business units with high market share and low market growth rate. Stars are those strategic business units with high market share and high market growth rate. Cash Cows are those strategic business units with high market share and low market growth rate. Dogs are those strategic business units with low market share and low growth rate. • Relevant strategies should be implemented for each strategic business unit depending on its position in the matrix. The strategies identified from the Starbucks Delivering Customer Service BCG matrix and included in the case pdf. These are either to further develop the product, penetrate the market, develop the market, diversification, investing or divesting. 10. Ansoff Matrix of Starbucks Delivering Customer Service Ansoff Matrix is an important strategic tool to come up with future strategies for Starbucks Delivering Customer Service in the case solution. It helps decide whether an organization should pursue future expansion in new markets and products or should it focus on existing markets and products. Email us for Any Case Solution at: [email protected] Note: This article is just a sample and not an actual case solution. If you want original case solution, please place your order on the Email. Please do check Junk/Spam folder of your E-mail for our reply, if not in Inbox.

Email us for Any Case Solution at: [email protected] • The organization can penetrate into existing markets with its existing products. This is known as market penetration strategy. • The organization can develop new products for the existing market. This is known as product development strategy. • The organization can enter new markets with its existing products. This is known as market development strategy. • The organization can enter into new markets with new products. This is known as a diversification strategy. The choice of strategy depends on the analysis of the previous tools used and the level of risk the organization is willing to take. 11. Marketing Mix of Starbucks Delivering Customer Service Starbucks Delivering Customer Service needs to bring out certain responses from the market that it targets. To do so, it will need to use the marketing mix, which serves as a tool in helping bring out responses from the market. The 4 elements of the marketing mix are Product, Price, Place and Promotions. The following steps are required to carry out a marketing mix analysis and include this in the case study analysis. • Analyse the company’s products and devise strategies to improve the product offering of the company. • Analyse the company’s price points and devise strategies that could be based on competition, value or cost. • Analyse the company’s promotion mix. This includes the advertisement, public relations, personal selling, sales promotion, and direct marketing. Strategies will be devised which makes use of a few or all of these elements. • Analyse the company’s distribution and reach. Strategies can be devised to improve the availability of the company’s products. 12. Starbucks Delivering Customer Service Strategy The strategies devised and included in the Starbucks Delivering Customer Service case memo should have a strategy. A strategy is a strategy that involves firms seeking uncontested market spaces, which makes the competition of the company irrelevant. It involves coming up with new and unique products or ideas through innovation. This gives the organization a competitive advantage over other firms, unlike a red ocean strategy. Email us for Any Case Solution at: [email protected] Note: This article is just a sample and not an actual case solution. If you want original case solution, please place your order on the Email. Please do check Junk/Spam folder of your E-mail for our reply, if not in Inbox.

Email us for Any Case Solution at: [email protected] 13. Competitors analysis of Starbucks Delivering Customer Service The PESTEL analysis discussed previously looked at the macro environmental factors affecting business, but not the microenvironmental factors. One of the microenvironmental factors are competitors, which are addressed by a competitor analysis. The Competitors analysis of Starbucks Delivering Customer Service looks at the direct and indirect competitors within the industry that it operates in. • This involves a detailed analysis of their actions and how these would affect the future strategies of Starbucks Delivering Customer Service . • It involves looking at the current market share of the company and its competitors. • It should compare the marketing mix elements of competitors, their supply chain, human resources, financial strength etc. • It also should look at the potential opportunities and threats that these competitors pose on the company. 14. Organisation of the Analysis into Starbucks Delivering Customer Service Case Study Solution Once various tools have been used to analyse the case, the findings of this analysis need to be incorporated into practical and actionable solutions. These solutions will also be the Starbucks Delivering Customer Service case answers. These are usually in the form of strategies that the organisation can adopt. The following step-by-step procedure can be used to organise the Harvard Business case solution and recommendations: • The first step of the solution is to come up with a corporate level strategy for the organisation. This part consists of solutions that address issues faced by the organisation on a strategic level. This could include suggestions, changes or recommendations to the company's vision, mission and its strategic objectives. It can include recommendations on how the organisation can work towards achieving these strategic objectives. Furthermore, it needs to be explained how the stated recommendations will help in solving the main issue mentioned in the case and where the company will stand in the future as a result of these. • The second step of the solution is to come up with a business level strategy. The HBR case studies may present issues faced by a part of the organisation. For example, the issues may be stated for marketing and the role of a marketing manager needs to be assumed. So, recommendations and suggestions need to address the strategy of the marketing department in this case. Therefore, the strategic objectives of this business unit (Marketing) will Email us for Any Case Solution at: [email protected] Note: This article is just a sample and not an actual case solution. If you want original case solution, please place your order on the Email. Please do check Junk/Spam folder of your E-mail for our reply, if not in Inbox.

Email us for Any Case Solution at: [email protected] be laid down in the solutions and recommendations will be made as to how to achieve these objectives. Similar would be the case for any other business unit or department such as human resources, finance, IT etc. The important thing to note here is that the business level strategy needs to be aligned with the overall corporate strategy of the organisation. For example, if one suggests the organisation to focus on differentiation for competitive advantage as a corporate level strategy, then it can't be recommended for the Starbucks Delivering Customer Service Case Study Solution that the business unit should focus on costs. • The third step is not compulsory but depends from case to case. In some HBR case studies, one may be required to analyse an issue at a department. This issue may be analysed for a manager or employee as well. In these cases, recommendations need to be made for these people. The solution may state that objectives that these people need to achieve and how these objectives would be achieved. The case study analysis and solution, and Starbucks Delivering Customer Service case answers should be written down in the Starbucks Delivering Customer Service case memo, clearly identifying which part shows what. The Starbucks Delivering Customer Service case should be in a professional format, presenting points clearly that are well understood by the reader. 15. Alternate solution to the Starbucks Delivering Customer Service HBR case study It is important to have more than one solution to the case study. This is the alternate solution that would be implemented if the original proposed solution is found infeasible or impossible due to a change in circumstances. The alternate solution for Starbucks Delivering Customer Service is presented in the same way as the original solution, where it consists of a corporate level strategy, business level strategy and other recommendations. 16. Implementation of Starbucks Delivering Customer Service Case Solution The case study does not end at just providing recommendations to the issues at hand. One is also required to provide how these recommendations would be implemented. This is shown through a proper implementation framework. A detailed implementation framework helps in distinguishing between an average and an above average case study answer. A good implementation framework shows the proposed plan and how the organisations' resources would be used to achieve the Email us for Any Case Solution at: [email protected] Note: This article is just a sample and not an actual case solution. If you want original case solution, please place your order on the Email. Please do check Junk/Spam folder of your E-mail for our reply, if not in Inbox.

Email us for Any Case Solution at: [email protected] objectives. It also lays down the changes needed to be made as well as the assumptions in the process. • A proper implementation framework shows that one has clearly understood the case study and the main issue within it. • It shows that one has been clarified with the HBR fundamentals on the topic. • It shows that the details provided in the case have been properly analysed. • It shows that one has developed an ability to prioritise recommendations and how these could be successfully implemented. • The implementation framework also helps by removing out any recommendations that are not practical or actionable as these could not be implemented. Therefore, the implementation framework ensures that the solution to the Starbucks Delivering Customer Service Harvard case is complete and properly answered. 17. Recommendations and Action Plan for Starbucks Delivering Customer Service case analysis For Starbucks Delivering Customer Service, based on the SWOT Analysis, Porter Five Forces Analysis, PESTEL Analysis, VRIO analysis, Value Chain Analysis, BCG Matrix analysis, Ansoff Matrix analysis, and the Marketing Mix analysis, the recommendations and action plan are as follows: • Starbucks Delivering Customer Service should focus on making use of its strengths identified from the VRIO analysis to make the most of the opportunities identified from the PESTEL. • Starbucks Delivering Customer Service should enhance the value creating activities within its value chain. • Starbucks Delivering Customer Service should invest in its stars and cash cows, while getting rid of the dogs identified from the BCG Matrix analysis. • To achieve its overall corporate and business level objectives, it should make use of the marketing mix tools to obtain desired results from its target market. Email us for Any Case Solution at: [email protected] Note: This article is just a sample and not an actual case solution. If you want original case solution, please place your order on the Email. Please do check Junk/Spam folder of your E-mail for our reply, if not in Inbox.

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EMBA Pro case study solution for Starbucks: Delivering Customer Service case study

At EMBA PRO , we provide corporate level professional case study solution. Starbucks: Delivering Customer Service case study is a Harvard Business School (HBR) case study written by Youngme Moon, John A. Quelch. The Starbucks: Delivering Customer Service (referred as “Starbucks Customer” from here on) case study provides evaluation & decision scenario in field of Sales & Marketing. It also touches upon business topics such as - Value proposition, Customers, Financial management, Market research. Our immersive learning methodology from – case study discussions to simulations tools help MBA and EMBA professionals to - gain new insight, deepen their knowledge of the Sales & Marketing field, and broaden their skill set.

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Case Description of Starbucks: Delivering Customer Service Case Study

The case 'Starbucks: Delivering Customer Service' is accompanied by a Video Short - available only to registered Premium Educators at hbsp.harvard.edu - that can be shown in class or included in a digital coursepack. Instructors should consider the timing of making the video available to students, as it may reveal key case details.Starbucks, the dominant specialty-coffee brand in North America, must respond to recent market research indicating that the company is not meeting customer expectations in terms of service. To increase customer satisfaction, the company is debating a plan that would increase the amount of labor in the stores and theoretically increase speed-of-service. However, the impact of the plan (which would cost $40 million annually) on the company's bottom line is unclear.

Case Authors : Youngme Moon, John A. Quelch

Topic : sales & marketing, related areas : customers, financial management, market research, what is the case study method how can you use it to write case solution for starbucks: delivering customer service case study.

Almost all of the case studies contain well defined situations. MBA and EMBA professional can take advantage of these situations to - apply theoretical framework, recommend new processes, and use quantitative methods to suggest course of action. Awareness of the common situations can help MBA & EMBA professionals read the case study more efficiently, discuss it more effectively among the team members, narrow down the options, and write cogently.

Case Study Solution Approaches

Three Step Approach to Starbucks: Delivering Customer Service Case Study Solution

The three step case study solution approach comprises – Conclusions – MBA & EMBA professionals should state their conclusions at the very start. It helps in communicating the points directly and the direction one took. Reasons – At the second stage provide the reasons for the conclusions. Why you choose one course of action over the other. For example why the change effort failed in the case and what can be done to rectify it. Or how the marketing budget can be better spent using social media rather than traditional media. Evidences – Finally you should provide evidences to support your reasons. It has to come from the data provided within the case study rather than data from outside world. Evidences should be both compelling and consistent. In case study method there is ‘no right’ answer, just how effectively you analyzed the situation based on incomplete information and multiple scenarios.

Case Study Solution of Starbucks: Delivering Customer Service

We write Starbucks: Delivering Customer Service case study solution using Harvard Business Review case writing framework & HBR Sales & Marketing learning notes. We try to cover all the bases in the field of Sales & Marketing, Customers, Financial management, Market research and other related areas.

Objectives of using various frameworks in Starbucks: Delivering Customer Service case study solution

By using the above frameworks for Starbucks: Delivering Customer Service case study solutions, you can clearly draw conclusions on the following areas – What are the strength and weaknesses of Starbucks Customer (SWOT Analysis) What are external factors that are impacting the business environment (PESTEL Analysis) Should Starbucks Customer enter new market or launch new product (Opportunities & Threats from SWOT Analysis) What will be the expected profitability of the new products or services (Porter Five Forces Analysis) How it can improve the profitability in a given industry (Porter Value Chain Analysis) What are the resources needed to increase profitability (VRIO Analysis) Finally which business to continue, where to invest further and from which to get out (BCG Growth Share Analysis)

SWOT Analysis of Starbucks: Delivering Customer Service

SWOT analysis stands for – Strengths, Weaknesses, Opportunities and Threats. Strengths and Weaknesses are result of Starbucks Customer internal factors, while opportunities and threats arise from developments in external environment in which Starbucks Customer operates. SWOT analysis will help us in not only getting a better insight into Starbucks Customer present competitive advantage but also help us in how things have to evolve to maintain and consolidate the competitive advantage.

- Streamlined processes and efficient operation management – Starbucks Customer is one of the most efficient firms in its segment. The credit for the performance goes to successful execution and efficient operations management.

- Experienced and successful leadership team – Starbucks Customer management team has been a success over last decade by successfully predicting trends in the industry.

- Low profitability which can hamper new project investment – Even though Starbucks Customer financial statement is stable, but going forward Starbucks Customer 5-7% profitability can lead to shortage of funds to invest into new projects.

- Starbucks Customer business model can be easily replicated by competitors – According to Youngme Moon, John A. Quelch , the business model of Starbucks Customer can be easily replicated by players in the industry.

Opportunities

- Increase in Consumer Disposable Income – Starbucks Customer can use the increasing disposable income to build a new business model where customers start paying progressively for using its products. According to Youngme Moon, John A. Quelch of Starbucks: Delivering Customer Service case study, Starbucks Customer can use this trend to expand in adjacent areas Customers, Financial management, Market research.

- E-Commerce and Social Media Oriented Business Models – E-commerce business model can help Starbucks Customer to tie up with local suppliers and logistics provider in international market. Social media growth can help Starbucks Customer to reduce the cost of entering new market and reaching to customers at a significantly lower marketing budget.

- Age and life-cycle segmentation of Starbucks Customer shows that the company still hasn’t able to penetrate the millennial market.

- Customers are moving toward mobile first environment which can hamper the growth as Starbucks Customer still hasn’t got a comprehensive mobile strategy.

Once all the factors mentioned in the Starbucks: Delivering Customer Service case study are organized based on SWOT analysis, just remove the non essential factors. This will help you in building a weighted SWOT analysis which reflects the real importance of factors rather than just tabulation of all the factors mentioned in the case.

What is PESTEL Analysis

PESTEL /PEST / STEP Analysis of Starbucks: Delivering Customer Service Case Study

PESTEL stands for – Political, Economic, Social, Technological, Environmental, and Legal factors that impact the macro environment in which Starbucks Customer operates in. Youngme Moon, John A. Quelch provides extensive information about PESTEL factors in Starbucks: Delivering Customer Service case study.

Political Factors

- Political consensus among various parties regarding taxation rate and investment policies. Over the years the country has progressively worked to lower the entry of barrier and streamline the tax structure.

- Political and Legal Structure – The political system seems stable and there is consistency in both economic policies and foreign policies.

Economic Factors

- Foreign Exchange movement is also an indicator of economic stability. Starbucks Customer should closely consider the forex inflow and outflow. A number of Starbucks Customer competitors have lost money in countries such as Brazil, Argentina, and Venezuela due to volatile forex market.

- Inflation rate is one of the key criteria to consider for Starbucks Customer before entering into a new market.

Social Factors

- Consumer buying behavior and consumer buying process – Starbucks Customer should closely follow the dynamics of why and how the consumers are buying the products both in existing categories and in segments that Starbucks Customer wants to enter.

- Leisure activities, social attitudes & power structures in society - are needed to be analyzed by Starbucks Customer before launching any new products as they will impact the demand of the products.

Technological Factors

- 5G has potential to transform the business environment especially in terms of marketing and promotion for Starbucks Customer.

- Proliferation of mobile phones has created a generation whose primary tool of entertainment and information consumption is mobile phone. Starbucks Customer needs to adjust its marketing strategy accordingly.

Environmental Factors

- Consumer activism is significantly impacting Starbucks Customer branding, marketing and corporate social responsibility (CSR) initiatives.

- Environmental regulations can impact the cost structure of Starbucks Customer. It can further impact the cost of doing business in certain markets.

Legal Factors

- Health and safety norms in number of markets that Starbucks Customer operates in are lax thus impact the competition playing field.

- Property rights are also an area of concern for Starbucks Customer as it needs to make significant Customers, Financial management, Market research infrastructure investment just to enter new market.

What are Porter Five Forces

Porter Five Forces Analysis of Starbucks: Delivering Customer Service

Competition among existing players, bargaining power of suppliers, bargaining power of buyers, threat of new entrants, and threat of substitutes.

What is VRIO Analysis

VRIO Analysis of Starbucks: Delivering Customer Service

VRIO stands for – Value of the resource that Starbucks Customer possess, Rareness of those resource, Imitation Risk that competitors pose, and Organizational Competence of Starbucks Customer. VRIO and VRIN analysis can help the firm.

What is Porter Value Chain

Porter Value Chain Analysis of Starbucks: Delivering Customer Service

As the name suggests Value Chain framework is developed by Michael Porter in 1980’s and it is primarily used for analyzing Starbucks Customer relative cost and value structure. Managers can use Porter Value Chain framework to disaggregate various processes and their relative costs in the Starbucks Customer. This will help in answering – the related costs and various sources of competitive advantages of Starbucks Customer in the markets it operates in. The process can also be done to competitors to understand their competitive advantages and competitive strategies. According to Michael Porter – Competitive Advantage is a relative term and has to be understood in the context of rivalry within an industry. So Value Chain competitive benchmarking should be done based on industry structure and bottlenecks.

What is BCG Growth Share Matrix

BCG Growth Share Matrix of Starbucks: Delivering Customer Service

BCG Growth Share Matrix is very valuable tool to analyze Starbucks Customer strategic positioning in various sectors that it operates in and strategic options that are available to it. Product Market segmentation in BCG Growth Share matrix should be done with great care as there can be a scenario where Starbucks Customer can be market leader in the industry without being a dominant player or segment leader in any of the segment. BCG analysis should comprise not only growth share of industry & Starbucks Customer business unit but also Starbucks Customer - overall profitability, level of debt, debt paying capacity, growth potential, expansion expertise, dividend requirements from shareholders, and overall competitive strength. Two key considerations while using BCG Growth Share Matrix for Starbucks: Delivering Customer Service case study solution - How to calculate Weighted Average Market Share using BCG Growth Share Matrix Relative Weighted Average Market Share Vs Largest Competitor

5C Marketing Analysis of Starbucks: Delivering Customer Service

4p marketing analysis of starbucks: delivering customer service, porter five forces analysis and solution of starbucks: delivering customer service, porter value chain analysis and solution of starbucks: delivering customer service, case memo & recommendation memo of starbucks: delivering customer service, blue ocean analysis and solution of starbucks: delivering customer service, marketing strategy and analysis starbucks: delivering customer service, vrio /vrin analysis & solution of starbucks: delivering customer service, pestel / step / pest analysis of starbucks: delivering customer service, swot analysis and solution of starbucks: delivering customer service, references & further readings.

Youngme Moon, John A. Quelch (2018) , "Starbucks: Delivering Customer Service Harvard Business Review Case Study. Published by HBR Publications.

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