Starbucks Coffee - The French flop

Thomas S.

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Résumé du document

Starbucks Coffee is a chain of cafes. The escorted image is the one of the Central Park Perks Café (the one of the TV Show Friends): a warm and cosy place where beautiful young smart and intellectual people are going to relax after a hard work day. A place where you are not leaning at the counter but comfortably seated in armchairs, and where the drinks are not served in a common with cup but in a design bowl or a vintage cup. So giving to the customer the feeling of a non-mass produced coffee.

1987 they sold the Starbucks chain to Howard Schultz. Quickly the brand began to expand and opened its first locations outside Seattle in Vancouver, British Columbia and Chicago (the same year). During 1992-96 the brand knew a great expansion, in 1995 one store per day were opened. It's also this year that Starbucks chairman decided to created a real brand identity (with specific designs, color, furniture). These changes permit to create the “Starbucks Experience”

The first Starbucks location outside of North America opened in Tokyo in 1996. Starbucks entered the U.K. market in 1998 with the acquisition of the then 60-outlet Seattle Coffee Company, re-branding all its stores as Starbucks

Sommaire

The Company
The objective expected
What was the target market?
What's wrong?
1. Company's perspective
2. Customer's perspective
3. Media's perspective
4. Competition's perspective
5. Law's perspective
What could have been done to solve the problems?
Could the product have succeeded if mistakes had been corrected?

Extraits

[...] Customer's perspective It was an ensure success, - with the success of Ally McBeal or the tyrannical Miranda from Devil Wears Prada” - with warm interior design, club armchair, cool waiters and XXL warm drink Yes but Paris make resistance, the paper it's the greatest marketing concept, but maladjusted to the French culture” summarize Bernard Boutboul, director from a survey company specialized into alimentation industry. The first one comes from the size of the coffee. By a majority French like short, strong and nature black coffee. Then, when Starbucks proposes to the market 87000 available combinations, the consumers don't see the interest of it (and sometimes don't understand anything). Caramel, Macchiato, Moka, White, Con Panna, Frappucino Vanilla or Chocolate, froth? Short-Tall-Grande-Venti? Another reason is linked to the strangeness from the coffee. [...]

[...] Mc Donald also bring to light the steep prices from the Seattle Company. It's not out of common to see consumer, paying for only one coffee, staying all the day in the most comfortable seat with a book or a laptop, without ordering anything else! The head office sent a letter to every shop-manager, which said that the staff had to increase the music sound volume when people were squatting, to disturb them. iii. Media's perspective The opening of Starbucks was followed by a great media buzz. [...]

[...] Thomas Soyer Starbucks Flop iv. Competition's perspective Even the number of had a strongly decrease ( 300.000 to 47000 in 100years), they are still greats competitors and most of the time they surpass in attractiveness. To drink a coffee and commenting the news with the shopkeeper does not have to see with employees of Starbucks. The waiters create and maintain the contact with the consumers, which Starbucks cannot afford due to the will of high turnover. The last survey from Starbucks shows that most of the consumers find the waiters unmotivated and even sometimes unpleasant. [...]

[...] Law's perspective Moreover, the best argument of Starbucks when it came in France has been reduced to nothing when the 1st January of this year all the bars became non smoking. It takes off the competitive advantage of Starbucks, especially for the family target. As a restaurant, the only restriction apply to Starbucks was the cleanness and the freshness of the products, and didn't got any problem with that. E. What could have been done to solve the problems? The French coffee market is very closed, a complex system of taxes are advantaging the French merchant and roaster (torrefactor). [...]

[...] NEW PRODUCT AND SERVICE DEVELOPMENT Starbucks Coffee The French Flop Thomas Soyer 06/11/2008 A. The Company Starbucks has been founded in 1971 in Seattle (Washington, USA), by 3 writers: Jerry Baldwin, Kristina Taplin and Gordon Bowker. The first concept was to sell high-quality coffee beans and equipment. - Headquarter Seattle: Seattle; CEO : Howard Schultz; Chairman: Jim Donald - Capitalization: 13,99 billion USD (2008) - Revenue 9,411billion USD (2007) - 147,436 employees Starbucks Coffee is a chain of cafes. The escorted image is the one of the Central Park Perks Café (the one of the TV Show Friends): a warm and cosy place where beautiful young smart and intellectual people are going to relax after a hard work day. [...]

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