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Environmental Scanning
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Environmental Scanning
Starbucks Corporation is considered to be an American coffee business and also a coffeehouse chain that was started in a place referred to as Seattle based in the Washington DC in early 1971; recently, the organization has been able to open other branches in close to 28,000 locations internationally. The business is viewed as the leading representative of the second wave coffee, previously distinguishing itself from its competitors within America through its outstanding quality, taste, and customer’s experiences while selling the darkly roasted coffee. In early 2000, the coffee sellers have targeted quality-oriented coffee customers continuously through their hand-made coffee. Several Starbucks locations typically serve their esteemed clients with hot and cold drinks, fresh juices, whole-bean coffee, and snacks that incorporate items such as crackers and chips. Therefore, the paper will look into the Starbucks internal and external surrounding through an environmental scan, the competitive advantage and how it is gained, verifying strategic effectiveness, and the measurement guidelines.
Environmental Scan of Starbucks
The external environment evaluation of the industry has been categorized into two groups that include remote environment and the competitive environment. The secluded surrounding comprises of issues that affect all business through a given market and may likely modify its way of operation. This sector presents an evaluation of the company’s remote environment through the use of PEST model where the modern political surrounding around the globe embraces globalization (Tu, Wang & Chang, 2012). Legislations are being put into law on a global level and in various jurisdictions to enhance free trade, and seamless flow of capital as this environment has allowed the Starbucks Company to incorporate an aggressive development technique. Therefore, this political surrounding presents the company with an opportunity to continue with its aggressive development techniques. On the other hand, the economic climate in Europe is typically a problem to the organization due to the crisis that is always threatening to lower the employment rate and the economic development rate in the European countries that are a significant market for Starbucks. Moreover, the social environment is also becoming a significant threat to the organization more so in the North American and European as reduced family earnings associate these regions as a result of the adverse economic climate and the ageing population. The technological environment enables both opportunity and threat to the organization as it is associated with many innovations and this provides Starbuck with a chance to enhance the efficiency of its duties and quality of its products.
The internal environment incorporates considerations that the organization can control as they represent the organization with both strengths and weaknesses. In the Starbucks Company, a stable financial position is considered as one of the areas of power for the business as it has recorded strong financial performance in the last years (Tu, Wang & Chang, 2012). The stable economic gives the organization the opportunity to exploit other potential aspects of the marketing environment that are effective in enhancing the production and marketing. Also, the company has a more significant workforce of over 250,000 workers that presents it with various advantages including innovation and timely creation of services. The company has got a reliable brand that has achieved recognition across the globe for coming up with high-quality coffee and also being useful in assisting the business in marketing its goods and services.
Competitive Advantage
Some of the competitive advantages that the company has; include the introduction of the unique Starbucks rewards card that strategically provides various profits to the manner in which products and services are given to the customers. These cards encourage consumers returning to make purchases and also assist in building their loyalty towards acquiring the organization’s goods and services (Flamholtz & Randle, 2012). Also, the company came up with the Starbucks client experience evaluation that enables consumers to share their opinions regarding their experience at the organization; hence, this outlines how the business is committed to establishing a long-term relationship with the consumers. As another competitive advantage, a connected consumer experience has been a significant aspect of the company as they use it to build and keep a long-term engagement with the clients. More than just offering excellent coffee, the coffee giant produces “Starbucks Experience” that strategically makes consumers feel comfortable thus leading to a secure emotional attachment.
Strategies used in Competitive Advantage
One of the strategies that the business uses is through incorporating technology into various business operations (West, Ford & Ibrahim, 2015). The coffee industry achieves a majority of its technology associated value addition through integrating technology into a more significant range of business processes and methods including the modern product development, communication of the marketing message, fulfilling sales and investigating the level of consumer satisfaction. Another strategy is through selling coffee of the highest quality that is typically considered as product differentiation. As part of the plan, the coffee champion concentrates on the general variety of its products and consumers pay premium prices for high quality.
Measurement Guidelines
Measurement guidelines should be set up against past outcomes with the aim of determining whether a given plan is functioning appropriately with the needed considerations put into place. Coming up with clear goals and checkpoints is essential in knowing if a formulated technique ought to change with the primary intention of achieving the set goals and objectives of the company (West, Ford & Ibrahim, 2015). The Starbuck Company uses metrics from growth percentages, annual consumers, revenue, and customer satisfaction as measurement guidelines with the aim of evaluating if the company’s techniques are successful.
Effective Measurement Guidelines
According to Flamholtz, & Randle, (2012), a business has to make sure that those people outlined as their target market are mainly the needed group to acquire the produced goods and services as many organizations fail through being unwilling or unable to come up with appropriate choices about target consumers and products. The guidelines used by the Starbucks Company are efficiently enabling the business to evaluate the result of its formulated techniques. Over the past years, the industry has been able to enhance its effects and is continuously moving forward with the competitive strategies even though there have been challenges within the business. However, these problems have been handled due to the prior detection via scrutiny metrics and thus allowing the company to grow internationally and enhance its revenue production.
References
Flamholtz, E. G., & Randle, Y. (2012). Corporate culture, business models, competitive advantage, strategic assets and the bottom line: Theoretical and measurement issues. Journal of Human Resource Costing & Accounting, 16(2), 76-94.
Tu, Y. T., Wang, C. M., & Chang, H. C. (2012). Corporate brand image and customer satisfaction on loyalty: An empirical study of Starbucks coffee in Taiwan. Journal of Social and Development Sciences, 3(1), 24-32.
West, D. C., Ford, J., & Ibrahim, E. (2015). Strategic marketing: creating competitive advantage. Oxford University Press, USA.
