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STARBUCKS

A L I S A R AY K H L I N A S A LV O M O R H AY I M LEVI LIGERMAN TOMER WEIL

IML 2012 - Lauder Business School

OVERVIEW

Founded in 1971 in Seattle Starbucks Corporation is a premier roaster and retailer of specialty coffee Mission: To inspire and nurture the human spirit one person, one cup and one neighborhood at a time Operates in 18,000 retail stores in 60 countries

IML 2012 - Lauder Business School

QUESTION #1
Using the full spectrum of segmentation variables, describe how Starbucks initially segmented and targeted the coffee market?

IML 2012 - Lauder Business School

ANSWER #1

Geographic U.S. Large Cities

Demographic Gender: Female > Male Age: 24-44 Race: Predominantly Caucasian Education: WellEducated Income: Affluent

Psychographic Middle-Upper Class Third place

Behavioral Appreciate Quality&Service Strongly Loyal Everyday User

IML 2012 - Lauder Business School

QUESTION #2
What changed first the Starbucks customer or the Starbucks Experience? Explain your response by discussing the principles of market targeting

IML 2012 - Lauder Business School

ANSWER #2
Starbucks Experience changed first.
Menu Growth
Starbucks Experience
Less Affluent
Less Educated

More Stores

Starbucks Customer

Less Professional

More Customers

More "Take Away"


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IML 2012 - Lauder Business School

QUESTION #3
Based on the segmentation variables, how is

Starbucks now segmenting and targeting


the coffee market?

IML 2012 - Lauder Business School

ANSWER #3

Geographic
Worldwide Different locations wthin a city

Demographic
Gender: Both Age: 16-50 Race, Education, Income: Not an Issue

Psychographic
Affordable for lower class Lifestlye: Doesnt Matter

Behavioral
Speed & Convenience Coffee to go Mostly not Loyal

IML 2012 - Lauder Business School

QUESTION #4
Will Starbucks ever return to the revenue
and profit growth that it once enjoyed?

Why or Why Not?

IML 2012 - Lauder Business School

ANSWER #4
VIA

YES

Ground Flavored Coffee Seattles Best Coffee

IML 2012 - Lauder Business School

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THANK YOU FOR YOUR ATTENTION