Starbucks
Florida Metropolitian University
Online -- Marketing Management 5805-1
Question 4
What opportunities and threats face Starbucks?
Had it not been for Howard Schultz’s persistence and his visions of exposing Americans to coffee, Starbucks might not be where it is today. When someone mentions Starbucks, your first thought is coffee. Starbucks has become known as the coffee giant and is internationally recognized for its good coffee drinks fixed to customer’s satisfaction and for their pleasant, sociable atmosphere. For their patron’s convenience, most shops now have wireless internet connection where executives, students, professionals, etc. can work on their laptops while enjoying their coffee or conduct business with small group at the table.
When Starbucks first opened, did not sell coffee by the cup, but sold coffee beans ground fresh while you wait. With the opportunity to purchase a used roaster, they started experimenting with the beans and came up with their own blends and flavors. This opened the door for expansion.
When Schultz attended an international housewares show in the spring of 1983 in Milan, Italy, he noticed that there were over 1,500 espresso bars in Milan and over 200,000 in Italy. A barista greeted patrons as they entered and in one bar, he heard a customer order a caffè latte, which he decided to try. This drink consisted of espresso mixed with frothy milk and a dollop of foam on top. It took Schultz over a year to convince the co-owners to start selling beverages in the store, but in April 1984, the downtown Seattle store began selling beverages and instead of the normal 250 customers, they had over 400 customers the first day. Within a couple of months, they were serving over 800 customers daily. Even though the increased revenue proved Shultz’s theory, the co-owners refused to allow him to open more expresso bars. In late 1985, Shultz decided to...
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