Starbucks Case Study
The company introduced Wi-Fi capabilities in its outlets already. Internet is important to the consumers. They can now surf the web and do work while sipping Starbucks coffee. This is an added value to the brand. It enhances the overall consumer experience.
Starbucks is also enabling mobile payments. They are testing this in pilot locations in the US.
Some other technological factors to keep in mind are:
* Emergence of innovative technology * Biotechnological developments * Developments in agriculture 3) Competitive Forces and Chalenges 3.1) Threat of New Entrants: Medium
* There is a moderate threat of new entrants into the industry as the barriers to entry are not high enough to discourage new competitors to enter the …show more content…
3.4) Bargaining Power of Suppliers: Low to Moderate
* The main inputs into the value chain of Starbucks is coffee beans and premium Arabica coffee grown in select regions which are standard inputs, which makes the cost of switching between substitute suppliers, moderately low.
* Starbucks, with its size and scale, has the power to take advantage of its suppliers but it maintains a Fair trade certified coffee under its coffee and farmer equity (C.A.F.E) program, which gives its suppliers a fair partnership status, which yields them some moderately, low power.5
* The suppliers in the industry also pose a low threat of competing against Starbucks by forward vertical integration, which lowers their power.
* Starbucks also forms a highly important part of the suppliers business, due its size and scope, which make the power of the suppliers lower. Given these factors, suppliers pose a moderately low bargaining power.
3.5) Intensity of Competitive Rivalry: High to