The history of Starbucks dates as far back as 1971 when Starbucks opened its first coffee store in Seattles Pike Place market (Patterson et al. It has grown exponentially with locations all over the world. Although Starbucks was very successful in the United States, this success was not replicated in the Australian market. These groups can play a big role in shaping how it communicates with its stakeholders by pointing out anything it may have missed or wants to improve upon. Results are Join to apply for the client relationship manager - 12 month FTC role at Starbucks. In this case, these contact persons act as the companys brand champions. Grow Together, 3. Should the company develop relationships with all of its stakeholders or only select a few? What Is In A Starbucks Caramel Macchiato? The report outlined the internal and external challenges that Starbucks faced. For Starbucks, its major stakeholders include employees, customers, suppliers and stockholders. The two main competitors of Starbucks are MacDonalds McCafe and Dunkin Donuts. However, Starbucks needs to improve its CSR performance to reach a 100% CAFE-certified supply chain to maximize environmental benefits. The success of any service firm largely depends on the ability of the organisation in question to target, acquire, get hold of, and retain keep the right customers. There are many more stakeholders that need to be recognized when companies consider their strategic and operational decisions. Consumers across the world are increasingly demanding fair practices, and this has seen many firms change their operating practices in order to accommodate these demands (Northey, 2007), and Starbucks is no exception. Once you own the shares, you can hold or sell them its up to you. Research reveals the most important stakeholder group of organizations are employees who come ahead of customers, suppliers, community groups, and especially far ahead of shareholders. However, the companys performance in addressing employees as stakeholders has room for improvement. The current strong brand and corporate image of Starbucks indicates the firms efforts to include stakeholders in its strategies and success. For instance, small local competitors can develop beverages similar to the companys products. For example, it is one of the first companies to offer full healthcare to full-time and part-time employees. Peloza, J., & Shang, J. The 4 include 1. Starbucks Company follows valuable practices and good citizenship in order to motivate its stakeholders. Starbucks Corporation (Starbucks Coffee Company), examined in this SWOT analysis, positions itself as the biggest coffeehouse chain in the world through innovative strategies that employ business strengths to overcome weaknesses, exploit opportunities, and protect the business against threats and barriers to success in the coffee industry environment. However, the management recently modified the logo in which the words Starbucks Coffee were removed. For example, Starbucks Corporations marketing mix or 4P indicates product mix expansion to include tea, food, and merchandise, in addition to coffee. Starbucks is also affected by the government of a country in which it operates. Imitability is a weakness that empowers competitors. If you are the copyright owner of this paper and no longer wish to have your work published on IvyPanda. The database is updated daily, so anyone can easily find a relevant essay example. of caffeine, over four times the amount of caffeine Read More Activists have protested outside its stores for various reasons, including human rights, union issues, and animal cruelty. The firm can improve its corporate social responsibility performance by addressing such issue in this stakeholder group. How the local competition defeated a global brand: the case of Starbucks. Excellence for Customers, 2. When identifying stakeholders, a firm should focus on those stakeholders that ______. They also provide feedback about what they want from their Starbucks experience. Starbucks global expansion and continued dominance in the coffeehouse industry indicates high financial performance. World Bank. 7 Examples of External Stakeholders. This is an expensive way to capture attention, but . Brand Concept Drives Loyalty Toward Starbucks: Concept, Product, Place, and Staff in Japan. A systematic review. External stakeholders are individuals or groups outside an organization who are vested interest in a company's success. A handful of strategic priorities makes it easier for external stakeholders to assess what matters most to the company. In this case, the main opportunities available to Starbucks are as follows: Starbucks Corporation can increase its revenues by further expanding in developing markets, many of which have high economic growth rates. Dicarlo, L. (2004). When Starbucks opens a new store, it is important to consider the impact on the local communities. Examples of internal stakeholders include employees, shareholders, and managers. This article may not be reproduced, distributed, or mirrored without written permission from Panmore Institute and its author/s. Opening a new store can have a negative impact on the community because the local coffee shops may have to close down or be forced to change what they offer to compete with Starbucks. He is a lecturer in Management and Marketing. Also, the company gradually diversifies its business through new products and new subsidiaries, resulting in the current product mix and brands of Ethos Water, Seattles Best Coffee, Teavana, and others. Starbucks failed in its maiden venture in the Australian market because by the time it was setting up shop in the country, Australians were already used to a coffee drinking culture that had been started by boutique-like coffee shops. Starbucks Case Study, SWOT, Internal and External Analysis 1. It must abide by the rules and regulations, tax, and other relevant issues very carefully as any breach may be costly for it. Some of the notable new products include Instant via Ready and Tazo Tea Infusions (Patterson et al., 2010, p. 44). fourth. External stakeholders still experience the effects of the business's activities but rarely hold any shares or ownership of the company. The company has even been involved in lawsuits because of these protests. Starbucks has many different stakeholders such as individuals, and institutions (hedge funds and mutual funds). They can affect how successful Starbucks is by doing their job and providing inputs into decisions that go into creating products and services that customers want. Stake: Product/service quality and value, #2 Employees. What is stakeholder and its types? 11 best internal communication examples: companies getting comms right 1. For example an external OD consultant may take a lot of time to understand the organization where internal OD consultants have a stronger understand being an insider of the organization. Shaoul, J. Starbucks has been the target of activists who are both for and against its actions. The external stakeholders include the suppliers, government, customers, society whose influence has an impact on the business. Furthermore, a suitable recommendation in this case is to implement creative marketing and branding strategies that build Starbuckss corporate image as a contributor to community development. Starbucks Company's External and Internal Analysis. This detailed piece of work identifies some of the internal and external stakeholders of Starbucks. So we took inspiration from that and created the logo from there. Sometimes these interests can conflict. These are people and organizations that are outside of the business. You are free to use it for research and reference purposes in order to write your own paper; however, you The internal The company has a growing population of loyal customers, which adds to the stability of the coffeehouse business. In addition, the discerning nature of the Australians, along with the fact that they had already developed sophisticated palates meant that Starbucks did not appeal to the locals as the management had anticipated. Investors. The company implemented the C.A.F.E program with a view to addressing issues raised by customers regarding Starbucks social reasonability (ICO, 2011). . These are the three main areas where Starbucks can change to boost its corporate social responsibility performance to satisfy stakeholders. There is two different types of stake holders these are internal and external. It is also recommended that Starbucks Corporation consider pricing strategies that attract more customers. Internal and external stakeholders are those within your organization and outside your organization, respectively. Internal stakeholders include your board of directors, upper management, and other departments in your company that may influence your flow of resources (e.g., human resources, finance team, etc. Australasian Marketing Journal, 18, 4147. Internal stakeholders are individuals or groups within an organization with a vested interest in the success of a business. A companys shareholders are the people and organisations who invest in it and share in the benefits or losses of ownership. Its headquarters are in Seattle, Washington. Consumers are also increasingly becoming aware of the need to reduce their sugar intake and Starbucks has also had to adjust the sugar content of its coffee products as well (Wall Street Journal, 2009). Origins of SWOT analysis. We utilize security vendors that protect and New York: Palgrave. And this is who their marketing is targeted to reach. Starbucks to Expand Premium Single-Serve Coffee Offerings. Internal and External Stakeholders. Starbucks has already implemented various corporate social responsibility programs for its stakeholders. There are two types of stakeholders: internal stakeholders and external . Design Your Materiality Survey. The statement is concise and inspiring, bringing the core idea of the business - be part of the community and grow together with internal and external stakeholder. Thus, the firm must contribute to the improvement of society. Regional and state unemployment 2010 Annual averages. Suppliers. Examples of external stakeholders are customers, suppliers, creditors, the local community, society, and the government. 1. SWOT analysis applications: An integrative literature review. For example, the company competes against major restaurant chains that offer lower-cost coffee products, such as McDonalds and Dunkin. August 4, 2021. https://ivypanda.com/essays/starbucks-5/. One of the Starbucks guiding principles is "to contribute positively to communities and environment.". This business analysis case also considers the opportunities and threats (external strategic factors) related to the competitive landscape, which involves the strong force of competition, as determined in the Porters Five Forces analysis of Starbucks Corporation. Creating a culture of warmth and belonging, where everyone is welcome. McDonalds challenging Starbucks with cheaper coffee drinks. The first Starbucks opened in 1971 at Seattle's historic Pike Place Market and went public two decades later in 1992. Communication from Starbucks happens through many channels including social media, press releases, websites, and customer surveys. Also, this SWOT analysis considers imitation as a major threat against the coffeehouse business. This opportunity draws attention away from the U.S. market, where most of the coffeehouse companys revenues are generated. Need a custom Case Study sample written from scratch by Starbucks cut costs of at least $500 million, closed 800 stores in the U.S. and laid off more than 4,000 employees. Thus, Starbucks Coffees corporate social responsibility efforts fulfill the interests of this stakeholder group. By 2008, Starbucks was opening 8 stores per day. The empire filters back: consumption, production, and the politics of Starbucks Coffee. Are You A 30% Or Greater Disabled Veteran Who Wish To Be Considered Non Competitively, How Do You Take Your Coffee In The Morning, #1 Customers. This part of the SWOT analysis of Starbucks Coffee Company identifies external strategic factors that impose challenges to international expansion and market penetration. Starbucks continues to improve its corporate social responsibility practices to address the concerns of different stakeholder groups. Mars is the world's leading manufacturer of chocolate, chewing gum, mints and fruit confectionery. Retrieved from https://ivypanda.com/essays/starbucks-5/. . The third place concept as practiced by Starbucks has helped to turn its stores into an ideal environment away from home where customers can relax, surf the internet, or listen to music (Patterson et al., 2010, p. 45). (2010). Customer. ensure the integrity of our platform while keeping your private information safe. Threats against the coffeehouse business are identified in this part of the SWOT analysis. How Do I Set My Hamilton Beach Coffee Maker To Auto Brew? External stakeholders are those who have an interest in the success of a business but do not have a direct affiliation with the projects at an organization. Houston Chonicle, 1. How Much Caffeine Is In A Grande Iced Cold Brew At Starbucks? These consist of everyone involved in management, marketing, designing, manufacturing, assembly, and general sales. Please share the article link on social media to help us continue with this free academic research. Essay Example on Starbucks . How Do You Ask For A Keto Iced Coffee At Starbucks? Thats the role a small group of social media strategists has taken on for Starbucks partners (employees) who communicate with each other through Facebook, Twitter and Instagram. Dunkin Donuts Vs. Starbucks. Email. The Starbucks Foundation is committed to strengthening humanity by uplifting communities to nonprofit organizations in our hometown of Seattle, and in neighborhoods and coffee- and tea-growing communities around the world. This study discusses the internal and external business ethics practiced at Starbucks Corporation. A good example is the companys VIA ready brew (Starbucks, 2011) and internet surfing srevices using Wi-Fi internet connectivity (Oliviera, 2011). Starbucks should continue to be more innovative in the design and development of new products. (2011). They can directly impact decisions or successes of an organization through: Taking a position or making a decision that goes against a company's goals and strategy. stakeholder strategy. To conclude, Starbucks has several internal and external stakeholders who can impact on it its operations and strategies significantly. IvyPanda. Starbucks imports coffee beans from different countries and each of these countries has its own tariff and customs regulations. It has operations in 44 countries, with over 15, 000 stores in operation (Patterson et al., 2010). The division contributed 13 percent of PepsiCos net revenues in 2015. Starbucks has a long-standing commitment to sustainability , and as part of our ongoing aspiration to reduce waste and become a resource positive company, we are continuously looking for ways to better manage our waste in stores and in communities; and developing more eco-friendly operations, from stores to supply chain. Starbucks products are priced at a premium owing to the perceived upscale image in the eyes of the consumers. These are standard stakeholders of almost every business that operates in the United States or overseas. Internal stakeholders may include top management, project team members, your manager, peers, resource manager, and internal customers External stakeholders may include external customers, government, contractors and subcontractors, and suppliers. Starbucks has high corporate social responsibility performance in addressing the interests of most of its stakeholders. Starbucks Coffee Companys stakeholder management approaches are based on different programs for corporate social responsibility (CSR). For example, the firms supplier diversity program ensures that more suppliers from around the world are included in the supply chain. Exchange rate and taxation shall also affect the operations of Starbucks through currency conversion. On the other hand, external stakeholders include customers, clients, business partners, suppliers and shareholders. The smaller boutique-style coffee shops are very popular with Australians because they offer personalized service, familiarity, and intimacy (Patterson et al., 2010). Innovation can make the companys products more difficult to imitate. This way, it can take advantage of any feedback from these groups and make changes as needed. The company has tried to change the formula of some of its products to suit the tastes and preferences of customers in certain markets (Patterson, Scott & Uncles 2010, p. 44). Customers Customers are the external stakeholders of the company, no customer mean zero profit. Starbucks must address the interests of numerous governments as stakeholders, considering the companys global presence. Starbucks Corporation, the American multinational headquartered in Seattle, Washington, is the world's largest coffeehouse chain. Opportunities and Threats. In addition, the brand image should also have appealing attributes. Although after that recession, revenue growth remained well. While analyzing Starbucks ' finances during 2007-2014, in the seventh period, the ratio and growth decreased (2008/09). "Starbucks Company's External and Internal Analysis." Walters, D., & Rainbird, M. (2007). Its Starbucks. Use a Multi-Channel Promotional Strategy Starbucks predominantly uses its website, social media channels and in-store displays to promote the brand and the products. Pizza Hut, Starbucks, Domino's, Dunkin' Donuts, and Wendy's are some of those competitors. Internal&External Customers: Example of Starbucks - 574 - GRE - Studocu Internal&External Customers: Example of Starbucks Internal&External Customers: Example of Starbucks prof. digesh pawar international journal for research in DismissTry Ask an Expert Ask an Expert Sign inRegister Sign inRegister Home Ask an ExpertNew My Library Modules "Starbucks Company's External and Internal Analysis." We use cookies for website functionality and to combat advertising fraud. 2021. Starbucks has also embraced a philanthropic philosophy as a tool for promotion. Dunkin' Brands engages with internal and external stakeholders about company strategy, current practices and future goals. They also have a legitimate interest in the business, and are generally grouped into two; the internal and external stakeholders. https://ivypanda.com/essays/starbucks-5/, IvyPanda. However, as competition becomes stiffer, Starbucks has had to embrace various promotional strategies. In addition, the company should consider diversifying to other food products besides coffee in a bid to cushion its revenue collection during harsh economic conditions. On a correlative and evolutionary SWOT analysis. Common examples of internal stakeholders in companies are senior management, project sponsors, and project team members. The internal factors in this part of the SWOT analysis of Starbucks Coffee Company show that the business must develop strengths to reduce the adverse effects of imitation and high price points on the companys market share in the global industry. Customer. Starbucks, American company that is the largest coffeehouse chain in the world. Starbucks Coffees main strengths are as follows: Starbucks Corporation has one of the worlds strongest and most popular brands. Those people or group affected directly is called internal stakeholders and those who are indirectly affected are . Strategic planning involves the design of options from which the company . For example, the companys generalized standards for crafted beverages reduce these products cultural alignment with local target markets and consumer preferences. Stakeholders Businesses have different types of internal and external stakeholders, with different interests and priorities. To have a positive impact on the communities it works with and in, Starbucks develops community stores that partner with local nonprofits The nonprofits these stores work with offer services aimed to meet the needs of the communities theyre located in. Starbucks has corporate social responsibility programs for environmentally sound business. Over the past four decades, Starbucks has become the undisputed leader when it comes to the retail, coffee business. Stakeholders, Mission, and Vision. We can define internal stakeholders as those directly involved in running an organization or a given project and who have a legitimate interest. Stronger market position through additional partnerships or alliances. As in any business, Starbucks must address investors as stakeholders. That's why they implemented a mobile employee app to reach their biggest asset: their customer-facing workforce. However, when the company decided to implements KPTs, it lost sight of the very things that made it successful. As the worlds most popular specialty coffeehouse chain, Starbucks effectively addresses this interest. Based on the foregoing arguments, the following recommendations are made to enable Starbucks enhance its business philosophy in the face of increasing competition and challenging business environment: Starbucks sells experience, and not just coffee. Starbucks Key Resources Human resources, high-quality coffee farmer centers, product developers, and stores. Customers want to receive the best possible product or service. This would also reduce cultural resistance. . Institutional shareholders can influence its both strategic and non-strategic decisions significantly. The coffeehouse chain business faces issues such as competition, imitation, and social trends that oppose international players in local markets. Copyright 2017 2025. CIB Assignment - Starbucks Case 1. Starbucks follows a matrix organizational structure with a combination of vertical and horizontal structures. Based on the current condition of the business, some of the most notable strategic management concerns enumerated in this SWOT analysis of Starbucks Coffee Company are the imitability of products and the corresponding threat of imitation, the threat of competition involving low-cost sellers, and independent coffeehouse movements. (2011). And she became the siren.. Stakeholders can be briefly defined as any party who are interested in an organization.