the adoptions of 4ps of marketing mix strategy by starbucks corporation company in marketing

Banking Academy of Vietnam International School of Business A business report on THE ADOPTION OF 4PS OF MARKETING MIX STRATEGY BY STARBUCKS CORPORATION COMPANY IN MARKETING By HOANG DUN

Banking Academy of Vietnam International School of Business

A business report on

THE ADOPTION OF 4PS OF MARKETING MIX STRATEGY BY STARBUCKS CORPORATION COMPANY IN MARKETING

By

HOANG DUNG NHI _ CO3 Teacher: Nguyen Bao Nhat Chau Student: Hoang Dung Nhi Class: CO3A

Course: Academic Writing Skills

Hanoi, 26/2/2024

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https://vietnambiz.vn/doanh-thu-The adoption of 4Ps marketing mix strategy by Starbucks Corporation Company in marketing

I Introduction:

Marketing is the process of developing, promoting, providing products and services, which is available for partners, consumers, clients and the community at large (Starbucks, 2017) Marketing is increasingly receiving attention from companies The 4Ps strategy has been an integral part of marketing because it includes the main rules of ensuring stable market positioning, specifically against other brands and before persuading buyers to choose their goods many companies use a variety of marketing strategies By applying these seven elements, the company can attract more potential customers, encourage customer sales and develop their own revenues Starbucks, one of the most well-known coffee brands both in the world and Vietnam, successfully applied 4Ps strategy for product, price, place, promotion.This report has given the basic information on Starbucks Corporation and evaluated the effectiveness of 4Ps that the company has adopted after analyzing the way they have implemented it

II The profile of Starbucks Corporation 2.1 Kind of business:

- The full name of the company: Starbucks Corporation

- The company’s headquarters: The Starbucks Center (formerly the SODO Center) located in Seattle, Washington

- Starbucks had up to 35,000 stores in over 80 countries, with 15,873 coffee shops located in the United States (Starbucks, 2024) => big size and scope

2.2 Development history:

- Year & Place of foundation: in 1971 at Seattle's Pike Place Market.- Founders: Jerry Baldwin, Zev Siegl, and Gordon Bowker.- Main timeline of the company’s development: ( Figure 1 & 2)

Figure 1 Development history of Starbucks (Starbucks, 2016)

Figure 2 Starbucks timeline (Zachariah-Jayson, 2014)

- The image below shows the kind of products of Starbucks Corporation: (Figure 3)

Figure 3 Products of Starbucks (Starbucks, 2015)

Figure 4 Other products of Starbucks (Starbucks, 2024) - Its major market for company activities: Starbucks Corporation had 35,711 stores in 80

countries => worldwide Figure 5 illustrates the major market of Starbucks Corporation:

Figure 5 major market of Starbucks (Andreas, 2021)

3 Management board/ organization structure:

Figure 6 shows the organization structure of Starbucks with Kelvin Johnson looking at the current CEO

Figure 6 The organization of Starbucks Company (Starbucks, 2020)

4 Vision/ Mission/ Objectives/ Core Values: 4.1 Vision:

Starbucks’ vision is to create itself as the world’s best manufacturer in coffee and other products, while maintaining its core values: premier provision, the best café provider in the world, firm principles, and growth (Starbucks, 2022)

4.2 Mission:

Starbucks proclaimed that they would motivate people’s willing with one person, one cup, and one neighborhood at a moment by lifting lifestyle, surpassing the requests of customers, simplifying commodities services, and being responsible for the community (Starbucks, 2022)

4.3 Objectives:

Starbucks wants to sustain itself as the most respected brand in the world

(Starbucks, 2012)

4.4 Core Values:

Starbucks core values are:

• To cooperate • Transparency

• To show respect for culture • Diligence

III Different strategies that the company adopts: #theredcupcontest in marketing strategy

- Starbucks' red cups have become a symbol of the holiday season, a tradition, and occasionally a source of controversy It was recorded in 2015 that in just 14 seconds in the first two days, there was a picture posted on Instagram, gathering 40,000 entries during the competition

Figure 7 #theredcupcontest in Starbucks marketing strategy (Starbucks, 2015)

5.1 Common theory related to the theory:

The adoption of 4Ps strategy in Starbucks Corporation:

• Definition of marketing & its roles: The term "marketing" describes the way a business uses to inspire the purchase or sale of a good or service It also combine spreading sales, exchanging, and giving commoditie to customers s s or to several companies (Starbucks, 2017)

• Definition of marketing mix is a strategy which consists of: numerous fields of focusing as part of an extensive marketing program

• Definition of 4Ps: The 4 Ps of marketing are price, place, product and promotion They provide a framework that companies adopt to successfully promote good services to customers, which is related to a marketing mix strategy

o Cappuccino, latte, macchiato,

o Tea (black, green, fruit) and non-coffee drinks like Frappuccino

o Snack menu includes bread, cakes, muffins, sandwiches, and other snacks

Figure 8 Coffee is the main product of Starbucks (Ngocdo, 2017)

- Non-fat milk products: Starbucks advanced products are consisted of: + Gingerbread Latte, Peppermint Mocha, Tazo Zen, Iced Flat White

Figure 9 Iced Flat White of Starbucks (Starbucks, 2022)

+ Snack condition: Starbucks also offers premium dishes to go with their beverages They offer fresh breads, cakes, muffins, croissants, croissants and sandwiches The figure below shows the product of pricing strategy

gure 10 Sandwich of Starbucks (Starbucks, 2024) Fi

• Price:

Premium pricing: a type of pricing strategy which allows Starbucks to set its costs higher than any brands, reflecting the superior standard of its goods, factor and s,customers feeling ’

o Starbucks began by offering affordable prices at a few locations in order to keep up competitiveness and to attract customers who were not affected by its high cost

o In addition, packaged goods are easily accessible to everybody and increase demand dramatically This reflects that Starbucks exploits relative pricing approache plus in ambitious pricing to their way of using marketing mix s o Furthermore, by using premium pricing, Starbucks offers a different size for

customers to select

=> The quality is always their main priority, which helps in maintaining loyal customers supporting fame The cost is typically expensive since the emphasis is not just on itsserving superior coffee but also on creating a high-value atmosphere and experience

Figure 11 Different prices in other countries of Starbucks (NeoMam Studios , 2023)

• Place:

- The locations in which Starbucks goods are offered is one of the most important elements in the marketing mix Starbucks targets on reaching world’s trade markets by stimulating restaurants various cities among countries.in

=> In several metropolitan areas around the world, there are many colorful Starbucks coffeehouses and bars

- Establish routes of distribution for Starbucks goods everywhere: + The combination of dedicated retailers and dedicated store websites + The adoption of internet store websites integrates Starbucks' marketing

strategies with the advanced commercial regions that are promising

Figure 12 Starbucks distribution (Starbucks, 2009) • Promotion:

This promotion includes singular methods of advertising, public relations, sales promotions, television commercials, and mass media to promote products

• Advertising: A way of using mass media as a tool, such as TV, radio, print, digital, to reach its curious customers like young people

• Social media: Applications like Facebook, Instagram, Twitter, and Pinterest will spread updates, promotions, and update news from Starbucks to its supporters • Repetitive and limited-time promotions: Starbucks introduces limited-time

deals and annual drinks, such as the Pumpkin Spice Latte and beverages related to anniversary, which makes purchasers feel happy and reassure them to buy products in stores

• Besides, Starbucks also suggest regular way of exchanging 1-for-1 and find creative ways to promote the deal Here’s a video they did in conjunction with Halloween:

• The Starbucks Rewards program implemented by this "coffee giant" not only helps customers have more motivation to buy products to earn points, but also gives them more opportunities to return to the store many times The idea behind the program is that participants who spend a specific amount of money to reach a minimum "reward redemption" amount would receive a free drink or piece of food

• Additionally, Starbucks has made available an internet application that makes it simple for users to locate the Starbucks station nearest to them and make rapid payments with a single tap

- The massive coffee business announced a $908.3 million net income for the first quarter of 2023, an increase from $674.5 million in the same period the previous year In the meantime, compared to the first quarter of 2022, Starbucks' revenue climbed by 14.2% during the first three months of this year The company's same-store sales increased 11% during the quarter, surpassing StreetAccount's aggregated expert predictions by 7.1% The foreign and US markets both fared better than anticipated

- "The first quarter numbers were remarkable on every level, but were even more so given the seasonal pressures we often experience in the first quarter of the year," stated Rachel Ruggeri, chief financial officer

=> Starbucks’ success is an evidence for the effectiveness of 4Ps

IV Conclusion:

To sum up, this report provides an overview of Starbucks Corporation and assesses the effectiveness of the company's selected 4Ps by analyzing its implementation strategies [1560 words]