Mission and Values
According to the textbook “A mission, or mission statement seeks to answer the question “What business are we in?” and “a vision or vision statement, seeks to answer the question “What do we want to become?”. In the beginning the answer to the mission was coffee and the vision was “the “Third Place”, the place between home and work where people gather, relax and interact with one another.” The mission and vision keep business decisions focused and provides a sense of direction. Over time, the focus was on growth and the bottom line, consequently, causing them to lose focus.
Segmentation
A market concentration approach to market segmentation allows firms to specialize in one market segment. All resources are concentrated on the target market which can be risky and makes firms susceptible to factors such as changes in the makeup of the market segment, and issues in the economy. If done correctly, it can lead to substantial profits. The table below indicates a change in Starbucks market segment from 2000-2005. You can see how the market segment changed substantially over a short period of time. 2000 2005
Ages 18-24 3 13
People of Color 16 37
College Degrees 78 56
Avg annual income 81000 55000
Positioning Positioning refers to how the target market views the distinguishing features of a product. This is important to …show more content…
This strategy was successful at first because of the lack of competition and because of their strong positioning. To be able to maintain this pricing strategy, they must maintain the benefits of the product, in Starbuck’s case, their vision of a “Third Place”. Reducing the differentiation of being the third place, makes it hard for them to be able to sustain this pricing position. As the relative position decreases, pricing becomes more elastic due to the differentiation factor no longer being relevant and the numerous alternative products to choose
According to the textbook “A mission, or mission statement seeks to answer the question “What business are we in?” and “a vision or vision statement, seeks to answer the question “What do we want to become?”. In the beginning the answer to the mission was coffee and the vision was “the “Third Place”, the place between home and work where people gather, relax and interact with one another.” The mission and vision keep business decisions focused and provides a sense of direction. Over time, the focus was on growth and the bottom line, consequently, causing them to lose focus.
Segmentation
A market concentration approach to market segmentation allows firms to specialize in one market segment. All resources are concentrated on the target market which can be risky and makes firms susceptible to factors such as changes in the makeup of the market segment, and issues in the economy. If done correctly, it can lead to substantial profits. The table below indicates a change in Starbucks market segment from 2000-2005. You can see how the market segment changed substantially over a short period of time. 2000 2005
Ages 18-24 3 13
People of Color 16 37
College Degrees 78 56
Avg annual income 81000 55000
Positioning Positioning refers to how the target market views the distinguishing features of a product. This is important to …show more content…
This strategy was successful at first because of the lack of competition and because of their strong positioning. To be able to maintain this pricing strategy, they must maintain the benefits of the product, in Starbuck’s case, their vision of a “Third Place”. Reducing the differentiation of being the third place, makes it hard for them to be able to sustain this pricing position. As the relative position decreases, pricing becomes more elastic due to the differentiation factor no longer being relevant and the numerous alternative products to choose