The idea for Starbucks began in 1983 when Howard Schultz discovered the espresso bar in Italy. Schultz discussed the idea with his bosses at Starbucks, who instantly turned down the idea. Schultz started his own company in 1985, bought the Starbucks name in 1987 and carried out his vision to put an espresso bar on every corner. Schultz believed people wanted a place away from their home and office that was convenient for their coffee. The company decided that customers should not have to walk far for a Starbucks location, on account of this they wanted their coffee shops nearby (Schwartz, 2013).
By the end of 1987, there were a total of 17 stores (Company Information, 2016). Five years later, after completing their initial public offering, …show more content…
Developers believed the combination of cinnamon, nutmeg and pumpkin would be too overpowering along with being unsure of the success of the product. Since 2003, Starbucks has sold over 200 million of this seasonal drink. Starbucks does not report sales of specific drinks, but Forbes estimates this fall Starbucks will make $100 million in revenues from Pumpkin Spice Lattes. It is believed the seasonal aspect of the drink fuels the popularity (O’Connor, 2015). Since Starbucks is considered a monopolistic competitive market, the price of the pumpkin spice latte plays a role in the demand. Several other competitors include Dunkin Donuts, Panera Bread and McDonalds have introduced pumpkin beverages into their fall lineups. Neither the competition or the price of a Pumpkin Spice Latte appear to affect the sales for Starbucks. During 2014, the average bill of a Pumpkin Spice Latte customer was $7.81, compared to a non-buyer which was $6.67 (O’Connor, 2015). Compared to competitors, Starbucks customers were the “happiest with 73% acquisition positively compared to McCafe at 60% and Dunkin’ Donuts at 57%” (Hanson, 2015). Consumers were also less concerned with the cost of Starbucks products over the competitors. Another factor in consumer’s decision to purchase Starbucks over McCafe or Dunkin Donuts is the volume of Starbucks locations. The map in Appendix 1 shows Starbucks, McDonalds and Dunkin’ …show more content…
In 2015, Starbucks announced it would make the Pumpkin Spice Latte with real pumpkin. The change in the product was attributed to competitors cutting out preservatives and artificial flavorings from the menu. Panera Bread was the first to reveal they would be serving a “Real Pumpkin Latte” without artificial colors, flavors, sweeteners and preservatives (Taylor,
By the end of 1987, there were a total of 17 stores (Company Information, 2016). Five years later, after completing their initial public offering, …show more content…
Developers believed the combination of cinnamon, nutmeg and pumpkin would be too overpowering along with being unsure of the success of the product. Since 2003, Starbucks has sold over 200 million of this seasonal drink. Starbucks does not report sales of specific drinks, but Forbes estimates this fall Starbucks will make $100 million in revenues from Pumpkin Spice Lattes. It is believed the seasonal aspect of the drink fuels the popularity (O’Connor, 2015). Since Starbucks is considered a monopolistic competitive market, the price of the pumpkin spice latte plays a role in the demand. Several other competitors include Dunkin Donuts, Panera Bread and McDonalds have introduced pumpkin beverages into their fall lineups. Neither the competition or the price of a Pumpkin Spice Latte appear to affect the sales for Starbucks. During 2014, the average bill of a Pumpkin Spice Latte customer was $7.81, compared to a non-buyer which was $6.67 (O’Connor, 2015). Compared to competitors, Starbucks customers were the “happiest with 73% acquisition positively compared to McCafe at 60% and Dunkin’ Donuts at 57%” (Hanson, 2015). Consumers were also less concerned with the cost of Starbucks products over the competitors. Another factor in consumer’s decision to purchase Starbucks over McCafe or Dunkin Donuts is the volume of Starbucks locations. The map in Appendix 1 shows Starbucks, McDonalds and Dunkin’ …show more content…
In 2015, Starbucks announced it would make the Pumpkin Spice Latte with real pumpkin. The change in the product was attributed to competitors cutting out preservatives and artificial flavorings from the menu. Panera Bread was the first to reveal they would be serving a “Real Pumpkin Latte” without artificial colors, flavors, sweeteners and preservatives (Taylor,