Case Study Analysis: Starbucks: Delivering Customer Service
Dr. Laura Pogue
May 29, 2011
Specialty-coffeehouse culture is well interwoven into the fabric of American society at this point and we can thank Starbucks for ushering in the phenomenon. Back when three coffee connoisseurs assembled to open the first Starbucks store in Seattle, I’m sure they could not imagine its behemoth future. With the vision of Howard Schultz, Starbucks has grown to become one of the most internationally recognized brands. With distribution that includes company-operated retail stores, global Specialty Operations, and licensing today Starbucks generates over 2 billion in revenues (starbucks.com). This growth, however,
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Although Starbucks dominated the retail coffee landscape, owning “close to one-third of America’s coffee bars, it had plans to open 525 company-operated and 225 licensed North American stores in 2003” (Moon & Quelch, 2003). Product innovation included introducing new drinks and the introduction of the Starbucks’ stored-value card. While the introduction of new specialty drinks, was “internally considered one of the most significant factors in comparable store sales growth, customers rated the new innovations as being much lower in importance than customer service,” yet Starbucks was placing high importance on developing them (Moon & Quelch, 2003). According to Moon & Quelch, the new specialty drinks generally took more steps to make, increasing the complexity of the barista’s job and increasing the time to make a beverage, conversely decreasing the speed of service and minimizing the barista’s ability to connect with customers; an activity promoted by the company and valued by customers (Starbucks: Delivering Customer Service, pp. 5,8,19).
The overarching problem I find in this case study is Starbucks lacks a centralized structured strategic marketing group to direct decision making. “Starbucks’