Starbucks

The Starbucks company is the coffee market leader globally due to the production of premium coffee and exemplary customer service. The company has almost 40 000 stores globally, serving approximately 100 million customers. The company uses various strategies to enter foreign markets, such as direct and indirect export, franchising and licensing, and it utilizes the marketing mix to establish a competitive edge.

Some international strategies include direct/ indirect exporting, franchising or licensing. Direct export entails directly selling products to the target customers in the foreign market, while indirect exporting is when an organization sells its products to an intermediary who ships the products to the foreign market (Chowdhury, 2016). On the other hand, franchising involves paying a certain amount to use another business brand, while licensing is an agreement with registered trademarks. In the case of Starbucks, it utilizes direct exporting, licensing and franchising to venture into foreign markets. It mainly adopts the multi-domestic international strategy, which involves a low level of integration and high responsiveness to the local market (Chowdhury, 2016). The Starbucks company's target market is the upper and middle social classes aged between 22-50 years and mainly uses the value-based pricing model. Thus, the Starbucks company uses the multi-domestic strategy to enter foreign markets with direct exports, licensing and franchising.

Starbucks' marketing mix includes place, price, promotion, and product. The product mix includes merchandise, coffee, baked foods, tea, foods, smoothies, and Frappuccino offered mostly in cafes and coffeehouses. However, the company uses websites, social media and retailers to reach the target audience (Koojaroenprasit, 2018). Strategies such as public relations, one on one marketing, sales promotion and advertising are used to enhance its brand image and increase market share. The company uses a premium pricing strategy due to its premium products. However, with time the company realized its products were easy to imitate, creating stiff competition from low-priced coffee products (Koojaroenprasit, 2018). Therefore, despite the product's numerous strengths and strategies, it also experiences threats from its competitors as its products are easy to imitate.

Starbuck company is a global company dealing with premium coffee products. It mainly utilizes a multi-domestic strategy, direct exports, licensing, and franchising to penetrate foreign markets. However, it utilizes the marketing mix to establish a competitive edge.

References

Chowdhury, P. P. (2016). An Analysis on Starbucks’ International Business Entry Strategies in China. AIUB Journal of Business and Economics, 13(1), 141-162. ajbe.aiub.edu/index.php/ajbe/article/view/66

Koojaroenprasit, S. (2018). Services Marketing Mix of Starbucks Coffee in Bangkok, Thailand. Asian Social Science, 14(9), 107-107. doi.org/10.5539/ass.v14n9p107