Assessment I - Marketing Strategies - DONE

 

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Details of Assessment  Term and Year

Term 1, 2019

Time allowed

4 weeks

Assessment No

1

Assessment Weighting

60%

Assessment Type

Individual Strategy Report 

Due Date

Week 7 

Room

Details of Subject  Qualification Subject Name

BSB61315 Advanced Diploma of Marketing and Communication Marketing Strategies

Details of Unit(s) of competency 

Unit Code (s) and Names

BSBMKG605 Evaluate international marketing opportunities BSBMKG606 Manage international marketing programs BSBMKG608 Develop organisational marketing objectives BSBMKG611 Manage measurement of marketing effectiveness

Details of Student  Student Name College

Daniela Lutten Leitão AAI

Student ID

201837789

Student Declaration: I declare that the work submitted is my

own and has not been copied plagiarisedthe from any person or source. I acknowledge that or I understand requirements to complete the assessment tasks. I am also aware of my right to appeal. The feedback session schedule and reassessment procedure were explained to me.

Student’s Signature:  ____________________

Date:

_16_/_08_/_2019_

Details of Assessor   Assessor’s Name  

Assessment Assessm ent Outcome  Assessment Result

Competent

Not Yet Competent

Marks

/ 60

Feedback to Student  Progressive feedback to students, identifying gaps in competency and comments on positive improvements: 

Assessor Declaration: I declare that I have conducted

a fair, valid, reliable and flexible assessment assessm ent with this student. Student attended the feedback session. Student did not attend the feedback session.

 Assessor’s

Signature: ___________________ Date:

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Purpose of the Assessment The purpose of this assessment is to assess the student in the following learning outcomes:  outcomes: 

Compet Comp eten en Not Yet (C) Competent (NYC)

BSBMKG605 Evaluate international marketing opportunities

1.1 Assess international trade patterns and identify their likely importance for the business 1.2 Research international business and electronic commerce market factors, and assess opportunities to enter, shape or influence the market for their likely contribution to the business 1.3 Identify international markets operating under free trade or protectionist arrangements and estimate likely ease of entering and trading successfully 1.4 Identify international trade policies and agreements and estimate their likely impact on international marketing opportunities 2.1 Identify and analyse impact of economic, political, social and cultural factors affecting international marketing opportunities 2.2 Investigate international market trends and developments to identify market needs relevant to the business 2.3 Identify new and emerging business and electronic commerce markets, and assess opportunities to enter, shape or influence markets based on their fit with business goals and direction, and their likely contribution to the business 3.1 Analyse and rate acceptability of political, financial stability and corruption risk factors of potential market 3.2 Analyse and rate acceptability of legal and regulatory requirements, and trade barriers to potential market 3.3 Relate risk factors to international business cycles in terms of economic conditions and estimate their impact on potential market 4.1 Identify and analyse international marketing opportunities according to their likely fit with the organisation’s goals and capabilities ca pabilities   4.2 Evaluate each opportunity to determine its impact on current business and customer base 4.3 Use an assessment of costs, benefits, risks and opportunities to determine financial viability of each marketing opportunity 4.4 Determine probable return on investment and potential competitors 4.5 Describe and rank marketing opportunities in terms of viability and likely contribution to the business BSBMKG606 Manage international marketing programs

1.1 Select viable international marketing opportunities and develop objectives consistent with the organisation’s capabilities and resources   1.2 Identify measurable international marketing objectives consistent with organisation’s strategic direction, and identify nature and extent of goals for

international market 1.3 Formulate strategic objectives and related key performance indicators by product, service, country or international grouping, and overall 1.4 Develop a risk management strategy to manage contingencies, and ensure marketing objectives are met in accordance with overall organisational requirements 2.1 Research international marketing opportunities and determine global or customised approaches for promotion of products or services 2.2 Evaluate options for choice of marketing approaches 2.3 Select a marketing approach to meet marketing objectives, international market conditions and consumer preferences 3.1 Evaluate business culture and consumer preferences, and identify compatible marketing 3.2 Identifystructures options for operational marketing structure and rank them for strengths

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and weaknesses in servicing international markets 3.3 Choose operational structure that best fits international market and product or service 4.1 Communicate international marketing objectives across the organisation to suit culture, customs, levels of knowledge, experience and needs of personnel 4.2 Identify and agree roles, responsibilities and accountabilities of staff and contractors involved in all elements of marketing effort 4.3 Develop communication strategy to ensure personnel responsible for each element of marketing mix work together to meet organisation’s marketi ng objectives 4.4 Manage marketing effort to ensure it is directed towards areas of greatest potential for the organisation 4.5 Manage integration of marketing, promotional and any sales activities in accordance with international marketing objectives 5.1 Monitor product, pricing and distribution policies in relation to market changes, objectives of marketing plan and organisational requirements 5.2 Monitor overall marketing progress against performance targets to ensure activity, quality, cost, and time requirements are met 5.3 Analyse, review and revise marketing outcomes and objectives 5.4 Analyse successes and performance gaps as to cause and effect, and use to improve international marketing performance 5.5 Analyse changes in market phenomena, and identify and document their potential impact on international marketing objectives 5.6 Document review of marketing performance against key performance indicators in accordance with organisational requirements BSBMKG608 Develop organisational marketing objectives   1.1 Confirm organisation’s mission, vision, purpose and values from current

organisational materials or from owners, directors or senior management 1.2 Analyse strategic organisational documents to identify organisational directions and targets 1.3 Complete a situational analysis identifying factors impacting the direction and performance of the business 1.4 Identify legal and ethical requirements for the organisation 1.5 Document and confirm strategic direction of the organisation with owners, directors or senior management, and identify its impact on marketing activities 2.1 Evaluate effectiveness of previous marketing and positioning strategies to identify lessons learned 2.2 Analyse current key products or services and major markets for strengths, weaknesses, opportunities and threats 2.3 Evaluate previous marketing opportunities captured by the organisation, and examine and document their profitability 2.4 Evaluate marketing performance against previous objectives, targets to identify critical success factors, and areas for improvement 3.1 Identify and analyse marketing opportunities for viability and likely contribution to the business 3.2 Use an assessment of external factors, costs, benefits, risks and opportunities to determine scope of each marketing opportunity 3.3 Analyse opportunities for likely fit with organisational goals and capabilities 3.4 Evaluate each opportunity to determine its likely impact on current business and customer base 4.1 Develop objectives in consultation with key ke y internal stakeholders that are attainable and measurable, and that identify nature and extent of what is to be achieved 4.2 Ensure objectives are consistent with forecast needs of the business and market 4.3 Ensure objectives are compatible with the organisation’s projected capabilities,

resources and financial position Marketing Strategies, Assessment No.1 v1.0 Last updated on 11/06/2019

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4.4 Ensure objectives are compatible with the org anisation’s direction and purpose, and meet legal and ethical requirements BSBMKG611 Manage measurement of marketing effectiveness effectiveness  

1.1 Review current marketing strategies and marketing plans, and research range of metrics available to measure effectiveness of relevant marketing processes and functions 1.2 Analyse effectiveness of current marketing metrics used by the organisation in each key marketing operation 1.3 Critically analyse how existing marketing metrics m etrics link to strategy, and opportunities to improve links 1.4 Plan to address any issues with use of marketing metrics within the organisation 1.5 Design criteria for retaining existing marketing metrics, and for selecting new manageable and cost-effective metrics 1.6 Gain approval for design or redesign of strategy from senior management 2.1 Set objectives for measurement and evaluation of marketing effectiveness 2.2 Select methods to measure marketing performance for each marketing process or function, tailored to the organisation s brand or unique positioning 2.3 Calculate costs of gathering and analysing data with assistance of relevant financial experts 2.4 Design and record implementation strategy for measuring and analysing marketing performance, or make recommendations for improving current strategy 3.1 Design and implement appropriate communication and training strategy, so marketing and other relevant personnel fully understand their role in measuring marketing effectiveness 3.2 Supervise design and implementation of specific metrics 3.3 Plan and monitor work activity to ensure adherence to strategy for measurement of marketing effectiveness 3.4 Design process to review and evaluate marketing metrics on a regular basis, and if organisational strategy changes Assessment/evidence gathering conditions

Each assessment component is recorded as either Competent (C) or Not Yet Competent (NYC). A student can only achieve competence when all assessment components listed under “Purpose of the assessment”

section are recorded as competent. Your trainer will give you feedback after the completion of each assessment. A student who is assessed as NYC (Not Yet Competent) is eligible for re-assessment.  re-assessment.   Resources required for this Assessment 

  

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Computer with relevant and access to internet Weekly eLearning notessoftware relevant applications to the tasks/questions

Instructions for Students  Please read the following instructions carefully

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This assessment has to be completed In class At home The assessment iis s to be completed according according to the instructions given by your assessor. Feedback on each task will be provided to enable you to determine how your work could be improved. You will be provided with feedback on your work within two weeks of the assessment due date. All other feedback will be provided by the end of the term. Should you not answer the questions correctly, you will be given feedback on the results and your gaps gaps in knowledge. You will be given another opportunity to demonstrate your knowledge and skills to be deemed competent for this unit of competency. If y you ou are not sure about any aspects of this assessment, assessment, please ask for clarification from your assessor. Please refer to the College re-assessment for more information (Student Handbook ). ).

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DETAILS   ORGANISATION DETAILS Note: The organisational details used in this assessment have been sourced (and to some extent paraphrased) from the organisation’s website and other releva nt documents of the organisation. The information used here is solely for educational purpose.

CASE ORGANISATION: STARBUCKS COFFEE (INTERNATIONAL/GLOBA (INTERNATIONAL/GLOBAL L CONTEXT)  Starbucks website --  https://www.starbucks.com/  https://www.starbucks.com/  

Brief History: The first Starbucks location opened in 1971. The name is inspired by Moby Dick’s first mate. This

name and the mermaid logo were inspired by the love of the sea, from Starbucks original location in Seattle Washington in the heart of Pike Place Market. Starting as a single shop specializing in high quality coffee and brewing products the company grew to be the largest roaster in Washington with multiple locations until the early 80’s. In 1981, current CEO Howard Schultz, recognized a great

opportunity and began working with the founder Jerry Baldwin. After a trip to Italy to find new products, Schultz realized an opportunity to bring the café community environment he found in Italy to the United states and the Starbuck’s brand we know today be gan to take form. Selling espresso by

the cup was the first test. Schultz left Baldwin to open his own Italian coffee house Il Giornale which found outrageous success and in 1987 when Starbucks decided to sell the original 6 locations, Schultz raised the money with investors and purchased the company and fused them with his Italian bistro locations. The company experienced rapid growth going public in 1992, and growing tenfold by 1997, with locations around the United States, Japan and Singapore. Starbucks also began expanding its brand. According to George Garza in his article the history of Starbucks the following product lines were added: • Offering Starbucks coffee on United Airlines flights. • Selling premium teas through Starbucks’ own Tazo  Tea Company. • Using the Internet to offer people the option to purchase Starbucks coffee online.   • Distributing whole bean and ground coffee to supermarkets. • Producing premium coffee ice cream with Dreyer’s. • Selling CDs in Starbucks retail stores. Starbucks uses minimal advertising and has grown on word of

mouth and brand recognition. Their mission statement from the company profile is as follows: “Our mission is to inspire and nurture the human spirit –  one person, one cup, and one

neighbourhood at a time.”  time.” 

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Their core competencies can be defined as high quality coffee and products at accessible locations and affordable prices, provided a community to share in the coffee drinking experience, and variety of choices. The also value ethics and good business practices and are a leader being voted one of 2010’s most ethical businesses by Ethisphere magazine for the 4th year running. (“Starbucks”)

Starbucks is facing its own struggles however as it saw sales start slipping before other companies did in the recent recession. According to Melissa Allison in her article Starbucks has a new growth strategy — more revenue with lower costs, Starbucks has closed 900 stores and eliminated 34,000  jobs. Starbucks new strategy is to refocus on some of the areas that decrease risk and up front investment. This includes expanding foreign stores, with aid of partnerships that share risk and costs, selling VIA instant coffee and other products in retail and convenience stores, and reinvigorating the Seattle’s Best Brand coffee.

A statement from CFO Troy Alstead this March paints this picture: “We clearly hit a wall and didn’t do very well in the 2007/2008-time frame. From here forward, when we grow Via, Seattle’s Best Coffee and consumer products, there’s less investm ent for each dollar of revenue.”   revenue.”

This new strategy has inspired some optimistic feedback. Morningstar investment research firm has increased estimate of Starbucks shares from $4 a share to $24 after the statement of revamping the brand. Product innovations and international expansion not only make the business potentially more profitable but defend them against competition. International partnerships increase challenges but also create new ideas in new markets that can then be translated back to markets. Starbucks is in a mature stage of its life cycle. It was founded over 20 years ago and it has experienced rapid growth in the last 2 decades. However, within the last ffew ew years its growth has slowed and has even had to close locations. They are now focusing efforts on previous endeavours and international expansion.

Old Value Chain:

Product Development

Bean and ingredient selection

Product Distribution

Storefront

Take-home products

The above is the value chain for Starbucks. The upstream portion of the value chain shows the product development from adding teas and international influences, to the research that took place to develop the VIA instant coffee line. They also search the globe for Fair Trade suppliers of high-quality beans. These products are then distributed to corporate storefronts, franchise locations, airport terminals, grocery stores and more, and finally offer ground coffee and gift cards to take home.

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Links to organisational website and relevant information on the organisation:  

Starbucks Australia website – https://www.starbucks.com.au/Home.php https://www.starbucks.com.au/Home.php   Why Starbucks just can't crack the Australian market https://www.sbs.com.au/news/thefeed/story/why-starbucks-just-cant-crack-australian-market https://www.sbs.com.au/news/thefeed/story/why-starbucks-just-cant-crack-australian-market   Starbucks brief on Wiki -  -  https://en.wikipedia.org/wiki/Starbucks  https://en.wikipedia.org/wiki/Starbucks  Starbucks Statistics -  - https://www.statista.com/topics/1246/starbucks/  https://www.statista.com/topics/1246/starbucks/  Starbucks race together campaign -  -  https://www.fastcompany.com/3046890/the-inside-story-ofstarbuckss-race-together-campaign-no-foam   starbuckss-race-together-campaign-no-foam Marketing Strategy of Starbucks -  -  https://www.cheshnotes.com/2017/01/marketing-strategy-ofstarbucks/   starbucks/ How to Create a Remarkable Brand -  -  https://coschedule.com/blog/starbucks-marketing-strategy/  https://coschedule.com/blog/starbucks-marketing-strategy/   https://www.marketing91.com/marketing-strategy-starbucks/   Marketing Strategy of Starbucks -  -  https://www.marketing91.com/marketing-strategy-starbucks/ Relevant resources on Starbucks -  - https://www.marketingweek.com/brands/starbucks/  https://www.marketingweek.com/brands/starbucks/  Plans on marketing -  - https://ninjaoutreach.com/starbucks-marketing-plan/ https://ninjaoutreach.com/starbucks-marketing-plan/   Communicating the message of quality via multiple channels -  -  https://researchmethodology.net/starbucks-marketing-strategy-3/   methodology.net/starbucks-marketing-strategy-3/ Starbucks Positioning -  - https://www.thebalancesmb.com/starbucks-use-of-market-research-propelsthe-brand-2297155   the-brand-2297155  Starbucks: best and worst marketing campaigns -  -  https://awario.com/blog/starbucks-best-and-worstmarketing-campaigns/   marketing-campaigns/

CONTEXT, PROBLEM SCENARIO & REQUIREMENTS: For addressing the assessment criteria and to answer the questions provided below, you may refer to the above given case and organisation (Starbucks Coffee) or you can select your preferred organisation. You are required to demonstrate in-depth knowledge on how to develop marketing objectives for an organisation, identifying international marketing opportunities, plan on managing international marketing programs and measure marketing effectiveness. To complete the assessment tasks successfully, you will need to acquire some organisational information to conduct some analysis for both understanding environment and organisational. You are also expected to do your own external secondary research to provide adequate information and to understand the market. You will be required to use the template/structure as provided below. Marking criteria and weights for each section are also provided within the structure.

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Assessment Type: Individual Report TABLE OF CONTENTS and Mark Allocations

 

PAGES

MARK ALLOCATED

1.

Conduct detailed industry analysis

5

2.

Conduct an internal and an external diagnosis of the company.

5

3.

Discuss your key marketing strategies and

MARK RECEIVED

10

core competence 4.

10

Analyse the key issues the organisation is facing and suggest alternative action

5.

10

Discuss product innovation and international market opportunities

6.

Discuss a new value chain for organisation

5

which might be required for the changing coffee market 7.

5

Identify your international marketing objectives and operational plan

8.

5

Evaluating, measuring and monitoring marketing effectiveness

9.

5

Identify Australian and International policies and legal factors affecting marketing operations

10. Reference 11. Appendix TOTAL 

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60

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Conduct detailed industry analysis (5 marks)

In this section you are required to discuss the following:   Industry Overview and analysis   Industry Demand Determinants and Profitability Drivers   Porter’s Five Forces Analysis of the Retail Coffee and Snacks Industry 

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INDUSTRY OVERVIEW AND ANALYSIS

Starbucks is an American coffee company and coffeehouse founded in Seattle in 1971. In 2018, the company was operating in 28,218 locations worldwide. The company’s mission is “To inspire and nurture the human spirit, one person, one cup, and one neighbour hood hood ar a time”, what requires not

 just serving excellent coffee, but also engaging customers at an emotional response. Starbucks is part of the Retail Coffee and Snacks Industry. This industry experienced a big slowdown in 2009 resulting from the economic crisis what changed consumer tastes, spending less on luxuries like eating out, choosing to purchase low-price items instead of high-priced coffee and drinks. Before that, the industry had a decade of growth consistent. Now, the industry is expected to grow annually at a rate of 3.9% for the next five years, with a potential to reach $35.1 billion revenues in the US. This growth would be mainly driven by an improving economy, increase in consumer confidence and expanding menu offerings within the industry. Starbucks dominates the industry with a market share of 36.7%. In 2017,and Starbucks results for fiscal continued to demonstrate the strength of its global model, its ability to successfully make disciplined investments in its business and business partners. Consolidated total net revenues increased 5% to $22.4 billion, primarily driven by incremental revenues from 2,320 net new store openings over the past 12 months and a 3% growth in global comparable store sales. View Appendix 1.  INDUSTRY DEMAND DETERMINANTS AND PROFITABILITY DRIVERS The industry’s demand for premium coffee and food/snack products can be affected by a number of

factors, which include the amount of coffee being consumed, the population income and economic stability, healthy habits, coffee pricing. It’s a very sensitive industry, and all these factors can substantially affect its growth. The amount of coffee consumption it a very important factor: with more people consuming coffee around the world, the revenue of coffee & snack shops is increased. A main cause for that would be the increase of income, as the economy improves the consumers starts to relax their budget. This factor has a very positive effect on the market revenue. On the last few years, the amount of people buying, looking for and consuming coffee has increased exponentially. Since 2012/13, the consumption of coffee has grown 1,3% a year, view  Appendix 2 . In result, the amount and variety of coffee shops has grown as well. Now, the primary input in the value of chain of the industry are the coffee beans, the variable prices of coffee beans determines market costs and profitability margins. The world price of coffee had increased highly a few years ago due to growing demand in other countries and the resulting supply shortages. Now, how it became more affordable, the market is showing more profitability and lower costs. View Appendix 3.  Concerning about heath also play an important role in determining the demand in the industry. Lately, the customers are more worried about what they eat and how they eat; view the growth of vegetarians and vegans worldwide. This can be a threat to the industry as they become more aware of issues related to obesity and weight. Because of that, has been a proactive response from the industry

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regarding organic and healthy products, as organic lattes and drinks, and organic snacks, as protein balls, for example. PORTER’S FIVER FORCES ANALYSIS

- Competitive Rivalry or Competition (Strong Force) Competitive rivalry is a strong force faced by Starbucks in the food service and coffee industries. The specialty coffee market is intensely competitive with respect to product quality, innovation, service, convenience and price. Starbucks has many competitors of different sizes internationally. Even having the largest market shares, the company still feels the pressure seeing that its closest competitors also has a significant market share. The variety of firms is not as large as its number, what make this force even more threating to Starbucks. The company has to fight a large variety of companies, within pretty much the same variety of products and services. In addition, Starbucks also has to fight the fact that, for the customers, most of the times, it has a low switching cost change from Starbucks to another company. Based on that, competition is one of the top priorities o be faced by Starbucks. - Bargaining Power of Buyers or Customers (Strong Force) This force really affects Starbucks. Again, the low switching costs cause the customers to easily change from Starbucks to another brands. In addition, the high substitute availability means that the customers can stay away from the company as much as they want, since they can find many replacements products. factors aretoso that ittotal is hard to pay Even attention fact that individual purchases areThese small compared thestrong, company’s revenues. with to thisthe weakness, the bargaining power still remains an priority strategic issue. - Bargaining Power Of Suppliers (Weak Force) Despite the individuals suppliers having a moderate size, what can be considerate a moderate strength, the high variety of suppliers weakens theirs bargaining power. Using as example, the coffee beans. There are many suppliers of coffee beans around the world, and all of them aim to supply their beans to the companies as Starbucks. With that, Starbucks can choose which company fits bests their necessity. In addition, their bargaining power is weakened not only by the variety of suppliers but also for the large overall supply. As a result, supplier’s bargaining power is a minor issue for

Starbucks. - Threat of Substitution or Substitute (Strong Force) This component indicates that it is a strong possibility for Starbucks to be negatively impacted by this force. The high availability of substitutes makes it easy for the customers to just choose another brand or product instead of Starbucks. And, as said before, the low switching costs it is also further strengthen the threat. Many of the substitutes are cheaper than the company’s products. So, this component is a high strategic concern to the company. - Threat of New Entrants or New Entry (Moderate Force) The cost of doing business is variable. It depends of many factors as the size of the shop, the range of products. The operating cost of a small coffee shop is lower compared to a Starbucks. However, small shops have lower supply needs, equals to lower supply costs. This is what enables small business to compete directly with Starbucks. However, brand development has a high cost. This is the condition that reduces the threat of this force. A small business does not have enough resources to develop their brand as Starbucks has. The company is internationally known, all this “fame” took  

years of hard work and investments, something that s small business cannot make. So, this force shows to be a significant threat, but not an urgent matter. Marketing Strategies, Assessment No.1 v1.0 Last updated on 11/06/2019

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Conduct an internal and an external diagnosis of the company. Use the SWOT and PESTLE tool to synthesize this information (5 marks)

In this section you are required to discuss the following:   Strength, Weakness, Opportunities and Threat for the company   Political, Environmental, Social, Technological, Legal and Economic analysis for the company 

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PESTLE ANALYSIS

- Political One of the main political factors that have affected Starbucks is related to the outsource of materials. Starbucks it is sourcing its raw material from another countries. This has gathered a lot of the attention from politicians in the West and, of course, from the source countries, what have significantly affected the policies of the global company.  Another major factor is the policies like fair trade policy. It is necessary to follow the laws and regulations in the countries from where the organisation buys the materials.  Also, each country has its on tax policies and employment laws. Starbuck Starbucks s has to consider that every time the company plans to open a new store in a new country. These can drastically affect the company and its business, if not be followed correctly. - Economical  Any global economic change or recession would be a main external problem for Starbucks. Nowadays, regarding the economical changes in the World, most people have been changing their consume habit, shifting to cheaper alternatives. This factor dented the profitability of Starbucks. This can be seen as an opportunity to attract these costumers back, or the company will continue to lose space in the market. Starbucks needs to understand the fact that the consumers are now prone to buy low price coffee offered by many local and other competitors around. These changing trends should be considered in order to maintain the business.  Another factor that may affect the organization is the local currency exchange rates. As mentioned before, with Starbucks buying raw materials from another countries, it may face higher costs of imports. An appreciation makes exports more expensive and reduces the competitiveness of exporting firms, what can result in the raw materials being cheaper, following an appreciation.  As also mentioned above, the taxes can influence any business. Different levels of taxes from different places can affect how the company operates. - Social  As stated, Starbucks can even offer of fer more affordable products but it might m ight have to affect the quality. This will expand the consumer base, including the buyers from the lower and the middle-income. The eco-friendly, vegetarians and vegan consumers are also increasing. This, what many people call a “trend”; it is also affecting many businesses, and can push Starbucks to make some significant

changes in their products ad services. Social factors evolve behaviour patterns and their culture influence. Every place has its on beliefs, norms, trends. Nowadays, these consumers are expecting something of quality in lower price. The days where Starbucks was the only or even best option for a cup of coffee are gone. Now the coffee lovers have many other brands to pick from, which oblige Starbucks to succumb to the changes in their policies and standards to follow the new culture.  culture.   - Technological Since the initiation of the mobile trend, Starbucks has been enjoying its benefits. The partnership with  Apple for the development of a discount app, it has been extremely helpful.

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Nowadays, the Internet is what keeps the world moving. Every Starbucks store has free Wi-Fi. That is why is a recurrent event to see people having a meeting, studying, and working, face timing, at a Starbucks store. They connected two important things to the customers. Now, everyone knows that if someone wants to work while relaxing with a cup of coffee, the best place for that is Starbucks. This added a huge value to the brand, enhancing the overall consumer experience.  experience.   Despite all that, the rising availability of home-use specialty coffee machines is a threat to Starbucks because it increases the availability of substitutes to Starbucks products.   - Legal Starbucks must guarantee that it doesn't abuse any laws and guidelines in the home market and nations from where they purchase crude materials. It ought to likewise remain alert about presentation of caffeine generation and utilization related arrangements and guidelines by wellbeing experts. Every region has its on trade regulations, employment laws, taxation laws, and even licensing regulations to open and operate a business. Starbucks is as of now performing admirably in these perspectives. Nonetheless, expanding business guideline, particularly in creating nations, compromises Starbucks Coffee's entrance to the work advertises. This outside factor likewise impacts Starbucks through expanded spending for HR. - Environmental For the last few years, the company has been working to reduce the environmental impact. It has initiated a Green store program where all the stores would follow building pro environmental standards, and also ensure that the designing, building and maintain of the stores evolve those standards. To reduce the plastics in the environment, the company is increasing its recycling programmes, promotion reusable cups, “straw less” , and planning to achieve a greener cup by 2022. The company has also invested in a solar farm, which delivers enough clean energy to power more than 600 stores. SWOT ANALYSIS

- Strengths Starbucks has a large geographical presence across the world, maintaining a 39.8% market share in the United States and operating in over 62 countries. Starbucks is also the most recognized brand in the coffeehouse segment and is ranked 60st in the best global brands of 2018, what categorized it as one of the world’s strongest brands.  Almost Almost 70% of world’s population know about this company and their products. In addition, the company gives a very high importance to the quality of their products. The company stores are located in some of the most prime and strategic location across the globe. This has earned them a significant advantage, being able to penetrate major markets and aim into the customers convince factor. In addition, their stores are visually appealing and have a ‘cool’ factor attached to it. They provide free Wi-Fi, great music, great service, warm atmosphere and an environment of community meeting spot, which forms a wider part of the ‘Starbucks Experience’. The main aim for the company is to make their stores a ‘third place’ besides home and work.  

Starbucks has a well-established group of loyal customers cult following status among consumers and they have also implemented loyalty-based programs to drive loyalty with the Starbucks Rewards programs and Starbucks Card. In the United States, the company’s membership incre ased 14% year over year under the My Starbucks Rewards (MSR) program in the fiscal 2018.   - Weakness Starbucks pricing police is considered a major weakness to the company. While Starbucks is focused on their differentiate range of products, with high quality and full of the whole ‘Starbucks Experience’, people find the prices of the company really high as compared to its competitors and usually consider Marketing Strategies, Assessment No.1 v1.0 Last updated on 11/06/2019

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Starbucks as a luxury item. In addition, the company suffers with a reduced affordability of its products, what causes limitations in their market shares, especially in areas with relatively lower disposable incomes.  Another weakness for the company is: many man y Starbucks products are imitable. A small and local coffee shop could easily develop drinks pretty similar to the ones that Starbucks sells. Even the design and ambiance of their stores are imitable.  By having a huge and aggressive expansion, and overcrowding market, the company takes their customers from one store to another, consequently reducing the possibility of long-term growth targets of Starbucks. This is happening especially in the US, where Starbucks has 13,930 stores. The culture of coffee is very different in each country. Mostly, Starbucks follows the American coffee culture that may not be widely accepted in some parts. Australia, for example, has a very different culture for coffee. They love their coffee with more flavour, more varieties, more specialized. This can affect the strategies for international expansion for Starbucks. - Opportunities The US has becoming more and more saturated every year, and so, it is important to have a good international expansion strategy. The main market to aim for the next few years is China. Starbucks has already started with the plan to open 600 new stores until 2022, expanding their physical footprint to 6,000 locations across 230 cities. As a developing market, China has been demonstrating a middle-class growth, as well as the adoption of the western culture of coffee drinking. This would continue to increase the revenues by high double-digit percentages in the next few years. In the end of 2018, the organization announced a partnership with Alibaba to create a new coffee experience in China. The main aspect of their partnership is the adoption of Ele.me, Alibaba's food delivery platform that has three million delivery riders and was valued at $9.5 billion, to pilot delivery services beginning from September in Beijing and Shanghai. With the expansion of the program to over 2,000 Starbucks stores across 30 cities.   But Starbucks has not only forged and alliance with Alibaba, but also with Nestle. The associations declared a worldwide advertising bargain that gives the last "never-ending rights" to showcase Starbucks' items all around outside its coffeehouses. This coalition will extend the worldwide reach of Starbucks marks in the shopper bundled merchandise and foodservice classes from the current amount of 28 to almost 190 nations around the globe. Starbucks is evolving its product rang with significant innovation around beverages, refreshment, health, tea and core food offerings. Drinks innovations have been a main contributor to the company’s growth over the years. Special and seasonal products such as the pumpkin spice latte have been in the market for 10 years and are very popular. Food has turned into a key development driver. The organization intends to extend its lunch menu and offer locally important snacks the world over. Starbucks' greatly discussed night program  – sustenance, wine and brew contributions  – accessible at 100 stores is required to be taken off in 20 –25% of Starbucks outlets in the US, being relied upon to include $1 billion in incomes before the finish of financial 2019. - Threats With the market being at a developed stage, there is expanded weight on Starbucks from its competitor’s specialty coffee stores . Another trend, which is ending up progressively well known, is claim to fame coffee roasters. These organizations are immediate to customer with a developing growing social media presence and advertising on unconventional avenues such as podcasts. They can make quality espresso and go direct to the buyer while building up an entire brand around their espresso including clothing, tumblers, and cups and home preparing alternative, for example, French and Aeropress. The times of requiring retail to have a fruitful business are finished and this is converting into the espresso business now. Many countries have worked around the interest for coffee, as long as the U.S., some even more. This makes a portion of the more exceedingly created and beneficial areas designated to change in Marketing Strategies, Assessment No.1 v1.0 Last updated on 11/06/2019

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the coffee culture. Countries such as these enjoy a very specific coffee consumption culture pertaining to the coffee itself, the service, and the environmental culture. As Starbucks has not had sufficient energy to completely adapt themselves to these new beliefs and qualities they can conceivably build up a negative discernment according to international buyers. This cynicism can bring losses of international profits that can also limit their opportunities of further expansion into these foreign markets. Another risk relating particularly to China is the continuous exchange war among it and US. China could fight back against the exchange taxes, making limitations on outside speculations and disregarding lawful privileges of remote possessed organizations.  Another possible threat is the volatility of the prices in the global coffee m market. arket. In the past few years, there have been considerate fluctuations in the prices of high quality coffee beans. The organisation can’t control it, the only possibility it is to try to adapt to it, or changing its own prices or suppliers . In an undeniably financially coordinated world, a monetary emergency like the one of every 2008 could have a stream down impact from the created markets to the creating markets. This danger would hurt incomes for Starbucks as purchasers move away from premium item blend to remain in constrained spending plans during monetary hardships.

Discuss your key marketing strategies and core competence (10 marks): In this section you are required to illustrate and present     Your marketing mix which would be the 4Ps (Product, Price, Price, Promotion, Place)   Core competence involves discussion around company’s innovation, quality of product/service (such as reliability and performance), customer service, flexibility offered to employees, any other competencies (such as organisations competitive advantages, superior internet presence, etc). 

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MARKETING MIX

- Product For the first marketing mix content, the organisation continues to innovate its product mix to capture more of the food and beverage market. The main products categories of Starbucks products are: coffee, tea, baked goods, Smoothies, Frappuccinos, and merchandise as mugs, bags of coffee, etc. However, the products are not the only things that Starbucks offers to its customers: it’s the superior coffee experience. In addition to that, the company offers a high quality and standard products. The customers are paying for the whole package. Over the world, Starbucks has all the more then 1000 distinct variations being offered to their clients. Despite the fact that they were somewhat late to present tea, they chose the procedure of brand restriction to make it famous. Alongside this, they likewise offer clients various items from season to season, for example, Frappuccino, strawberry cream in summers and various lattes, for example, gingerbread latte in Christmas. In the Starbucks store you can likewise discover Starbucks cappuccino and espresso creators. - Price Starbucks pricing strategy is premium. Its products are more expensive than most competing products. Despite using a high price strategy, the company offers a high quality standard image. And its top of the line innovation and the assortments it offers alongside the best client experience. Starbucks began with started with a low cost range at few outlets and providing food the clients who couldn't be pulled in by its high costs. The bundled items are likewise accessible at supermarkets, which are similarly less expensive than the ordinary outlet items and effectively accessible to everybody. This demonstrates Starbucks not just pursues focused valuing in its showcasing blend yet additionally relative estimating methodologies. The beverages at Starbucks are additionally accessible in different sizes according to the need and necessity of each client with moment varieties like demi, short, smaller normal, grande, venti andand trenta. Thename. quality is consistently the most noteworthy, which aids inthan keeping up tall, a reliable client base brand

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Starbucks follows a simple line of thought  –  if the consumers get prem ium products they wouldn’t mind paying a little more. So for them quality is the key. The never bargain on the nature of the items and actualizes severe and stringent quality control measures alongside extraordinary client administration to legitimize its cost. - Place  At the beginning, St Starbucks arbucks used to sell se ll its products through t hrough coffeehouses. cof feehouses. Eventually, Eventua lly, the company started to offer some of its products through its online store. However, Starbucks ended its online store operations in 2017. The strategic change reflects the company’s shift to focus on in-store experience. On the other hand, mobile apps allow customers to easily place their orders online so they could conveniently get their food and drinks at the stores. Starbucks utilizes more than one channel of dissemination. They sell their items through organizationpossessed stores or an immediate retail framework. They import espresso beans from the best greenhouse the procedures it and sells it under their image name. Likewise, they have concurrences with lodgings, carriers and office espresso providers. This causes them take into account the more extensive market. Worldwide, Starbucks is present in more than 70 countries in Africa, North America, Oceania, South  America, Asia and Europe. Starbucks presents a well designed website which contains cont ains information on each and every aspect of coffee making, coffee varieties available, sourcing options, ingredients and best equipment and makers. - Promotion When it started, Starbucks became popular especially by providing the best customer experience and trusting the word-of-mouth marketing. The organisation alsothe advertises products throughare traditional media such as television and print media; and, of course, Internet. its Sales promotions used in Starbucks Rewards. Using the same idea of the loyalty coffee cards, this program involves free products that customers can avail after purchasi ng a certain amount of the company’s products. Starbucks rarely uses public relations, which has not always been successful for the company. A good example is what happened with the Race Together campaign, which was widely criticized. Still, the Starbucks Foundation continues its efforts to solve various challenges in society, helping communities while promoting its brands. Through its community programs for local communities, The Swastha  – consists in a healthy program and Chai project, developed with ethical sourcing options providing benefits to farmers, coffee, tea and cocoa sourcing areas; and environment friendly techniques  –  using recyclable cups, green building, etc. it clearly displays the responsibilities and actions taken by the company. Apart from this Starbucks has made the best use of technology for promotions, for example when they did the “tweeta-coffee” campaign in 2013; the  feedback system through “My Starbucks Idea”, and also the, already mentioned loyalty program and gift cards with free Wi-Fi, zero charges for selected coffee and milk options, etc. Another options that attract increase bar the codes interests the customers are the prepaid cards, mobile apps, table top power mats and for charging, for of cashless payments. In the last few years, despite all these programs and initiatives, compared with the competition, Starbucks did not invest a lot of money on advertisement. While McDonald’s normally spent around 727.7 million dollars on advertisement in 2010, Starbucks only invested 16.6 million dollars. Starbucks used their extra cash on finding and acquiring the best places for their outlets. They organized huge events in the places where they could open new stores. They likewise had numerous other special exercises, which included printing data on tee shirts and mugs. Aside from this they additionally thought of the idea of brilliant associations. This implied naming nearby delegates as their envoys to embrace their image.  CORE COMPETENCE

For each organization the structure of their upper hand technique assumes a fundamental job. It causes the organization to continue in this focused market condition. It is consider as a fundamental instrument to find and arrive at the potential clients. Starbucks is an organization that is acclaimed in the market and has produced an immense benefit. It is considered as a settled organization in the market. Be that as it may, its supportability can be influenced if its rivals offer comparative Marketing Strategies, Assessment No.1 v1.0 Last updated on 11/06/2019

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administrations and items as offered by the Starbucks Company in the market. In this manner to get by in the market each organization should have its upper hand system. Starbucks has a different relationship with its customers and suppliers. They focus in providing the best experience they can for their customers, with a good good customer service, more value quality products and access to the Internet and the best coffee. In addition, the company ensure to encourage and motivates their team, so it can keep both sides satisfied, what also contributes to improve the customer’s experience. Starbucks is able to sustain in the competitive market because of it unique competencies which their customers most valued. Keeping a long lasting growth ii has been possible for Starbucks thanks to their various strategies related to pricing and product. The company is always developing new products for their new markets, always maintaining its value and quality. The organisation has figured out how to expand its benefit and piece of the overall industry with its development procedures and by different joint endeavours with other related organizations. Especially in the United States, Starbucks has coordinated effort with organizations like Dreyer's dessert and Sazaby, which further builds their offer in the market. Starbucks has always concentrated more on its expansion policies. The company has experienced huge benefits because of it large integration methods and international, domestic and national expansion. The core competence of Starbucks has been its capacity to effectively use their strategies to show their differentiation by offering a top-notch item blend of excellent drinks and snacks. Starbuck's image value is based on selling the best quality coffee and related items, and by giving every client a one of a kind "Starbucks Experience", which is gotten from preeminent client administration, spotless and well-kept up stores that mirror the way of life of the networks wherein they work, accordingly fabricating a high of clientqualities dependability a faction following. Its otherfor core competence is its human asset the level executives' based with methodology based approach building very strong internal and external relationships with suppliers, which drives the successful deployment of its business strategy of organic expansion into international markets, horizontal integration through smart acquisitions and alliances that maintains their long-term strategic objective being the most recognized and respected brands in the world.  

Analyse the key issues the organisation is facing and suggest alternative action (10 marks): In this section you are required to  to    Highlight the key issues of organisation (example: challenges of massive global expansion, barriers to innovation, difficulty in creating new value chain, etc)   Suggest alternative action w which hich can minimise the issues or strategies to prevent the issues. 

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Starbucks has a few issues as organisation. In the US, it fast expansion has been a problem. It was discovered that within same location there were many stores, which further resulted in saturation of customers. That resulted in a considered number of stores being closed down. Results of Starbucks are considered as extravagance things. It might be conceivable that in view of the worldwide monetary downturn the client may think that it’s hard to spend on Starbucks item, which are minimal expensive when contrasted with their competitors item.  

 Another big and recurrent problem is the increase in competition. Globalisation has resulted in the increase in the competition for the Starbucks Company. The Starbucks has to compete in the market ranging from the various international companies as also with all the local coffee shops. The speculations made by the Starbucks are to plan their stores is high. This is done so as to pull in numerous clients and give them charming and reviving background. This can be come about exorbitant to the organization. In the last few years there has been a change in the customers behaviour. Shoppers are investing more energy at home, and a greater amount of them are preparing their very own high quality art

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espresso, various examinations have appeared. Simultaneously, they are additionally expending progressively prepared to-drink coffee and different drinks. They are having more access to blend and coffees that before where only available in special places, like a coffeehouse. Things have been changing regarding the competition as well, both at home and abroad. At home, Starbucks is facing growing competition from McDonald’s McCafes and all -day breakfast, as evidenced by the recent turnaround in McDonald’s sales. Overseas, Starb ucks is facing strong competition from homegrown start-ups that have managed to match and even exceed Starbucks “third place” model. A good example of that is the Greece-based Mikel Coffee Company, which features a portfolio of 130 beverages —  and an elegantly designed “third place” look,  look, staffed by

carefully recruited and well-trained and dedicated associates.  Additionally Starbucks insufficient promoting technique on publicizing is prevention in the business development openings. They like to fabricate the brand by advancing the beverages cup-by-cup with clients. The notice closes until they drink the espresso, lessening the odds to draw in significant clients. Likewise the thorough extension technique pursued by Starbucks can negatively affect the organizations brand picture. As partnerships develop there can be an inclination to concentrate too intensely on expanding yield and areas, and less spotlight on quality and brand picture. Starbucks needs to remain with its qualities and goals that have made it effective. Likewise Starbucks strategy of not diversifying can be a reason for worry for the firm. Diversifying would enable the organization to open numerous new stores with fewer hazards, and make extensive benefits in doing as such. Due to this the association's innovative work expenses would fall utilizing the franchisee learning of the nearby market as far as geographic,, psychographics, socioeconomics, and the neighbourhood nation guidelines.   Increasing is investments in marketing activities and marketing researches are very strong factor that would help the company to overcome these issues. It is essential to fight directly with the two primary issues: the growing competition and the insufficient promotion techniques. These could be the differential to the company to finally conquer the markets where they have lower performances as the  Australian market.

Discuss product innovation and international market opportunities (10 marks) In this section you are required to discuss the following:   Discussion on new range of product product or suggest improvement on existing ones   Differentiation strategy   Opportunities based on international location, labour market, cost competitiveness, ect 

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Opportunities related to global and country country specific specific economic, economic, social social and industry directions, trends, practices and techniques. Risk assessment for the opportunities Analysis of financial feasibility to implement your strategies

Nestlé today reported the dispatch of another scope of espresso items under the Starbucks brand to be accessible all-inclusive. The new range comprises of 24 items, including entire bean and dish and ground, just as the first-ever Starbucks cases created utilizing Nespresso and Nescafé Dolce Gusto restrictive coffee and framework advances.  Following this idea, Starbucks could consider to launch a whole collection of coffee machines and tools, to add to its products already been launched. This could help Starbucks to become a reference in the coffee industry regarding beans and production of coffee. This initiative would definitely make a difference in the Australian market. Customers really value a coffee shop it serves a really well known coffee and uses well-known equipment to make it. It could be another arm that Starbucks could grow from itself.

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Starbucks also does not emphasize on distributing their products to supermarket because of being concerned with the quality of the coffee; if the coffees were packaged into plastic bags. Investing in putting all their products and differentials in a place of easy access to the public would be essential. A coffee house how sells and distributes globally its own coffee, produced, grounded and made it by its own equipment.  A good opportunity for the company would be to invest in creation of healthier drinks. Most people today are living a healthier life, cutting sugar, milk, or even becoming vegans. Investing in more options that can satisfy this crescent wave of customers could make the difference. The loyalty and reward programs are something to keep and improve. There are 15 million dynamic Starbucks Rewards individuals, an expansion of 13% from a year ago. Those clients, who utilize the portable application to request and pay, will in general be progressively steadfast and have helped support deals. In the course of recent months, Starbucks likewise included another 5 million computerized clients. Those incorporate clients, who have utilized the Starbucks application without joining the prizes program, pursued Happy Hour bargains and got to Wi-Fi in the store by entering in their email address. The thought is to open a line of advanced correspondence with more clients, even the individuals who would prefer not to progress toward becoming individuals. Starbucks utilizes an expansive separation procedure. This system is focused on a more extensive fragment of the all out market. Starbucks serves a market that is characterized by espresso consumers. Starbucks has made the association surely understood for fitting to wide clients' needs by planning requests to meet clients' desires, regardless of how nitty gritty they are. Starbucks is likewise outstanding for quality with inside stringent rules delineating their espressos to be readied, as itemized as coffee mustitems, be served twenty-three secondshow of preparing. India is also an international opportunity for Starbucks. As the Indian economy seeing high single digit development, Starbucks sees an immense open door in the developing white-collar class with higher discretionary cash flow in the nation. While the organization faces extraordinary challenge in India from espresso chains, for example, Café Coffee Day, which had almost 1,500 stores in December 2014, the general bistro showcase in India is esteemed at $1.1. Billion of which the chain bistro market is worth almost $300 million. In spite of the fact that it works just 75 stores in India Starbucks accepts that India is its quickest developing business sector. The organization intends to bring its customer bundled products, alongside its strength tea brand, "Teavana," to India. Given that India is overwhelmingly a tea-drinking country, dispatch of Teavana in the nation could help Starbucks gain clients in the district. It will likewise profit by carrying its versatile and computerized innovation to India as portable request and pay can lessen long lines in the thickly populated urban territories of the nation, in this way furnishing Starbucks with an aggressive edge. Every new plan or action presents its risks. With all these opportunities, Starbucks also is open to bad results, as previously experienced in Australia. Sociocultural barriers are one of the big risks that the company face it. Every country and continent has a different culture and experience regarding coffee. The small coffee shops are easily adapt to them, but for a company as big as Starbucks, to be able to adapt all its operations to give what the customers are expecting is risky. Asia, India and Australia are very different markets regarding coffee. It is important that Starbucks study and research deeply into to the markets to understand how they work and what the competition is doing right and wrong. A high investment will be necessary, but it is a risk that the company is willing to take to conclude its objectives. Launching new products or services is also very risk. It is a high investment that if it goes wrong, it is a lot of money that is going to be wasted and the company’s profits can be highly affected. The

company can, again, have a good marketing team, well trained and really into making it all happen, invest and researches, tests; and also working with the right marketing activities. Even doing all that, it is possible that it may not work. However, all those actions make it easier to reach success than failure.

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Now, all that is financially possible? Considering all the costs with the creation and development of new products and equipment, plus the budget for the marketing activities and operational costs, it is Starbucks able to do all that, financially? The cost cannot be too high, otherwise even if it works it may take several years to recover the money invested or even profit on top. How long the company will take to be paid back for all the investment? It is important to have all that studied and planned, but, as said before, it is possible that even with all worked out, great planning and great team, some things just don’t go as planned. It is essential that

Starbucks evaluate all the possibilities and if it is worthy it to make these investments in different markets. It is truth that, if all the efforts and opportunities work, Starbucks will have amazing results, with a high ROI and a favourable financial impact to the brand.

Discuss a new value chain for organisation which might be required for the changing coffee market (5 marks) In this section you are required to discuss the following:     Refer to the val value ue chain given in the case and suggest addition to the value chain.   The development of value chain should consider factors su such ch economical, technological, cultural, recent trend in coffee consumption, etc 

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VALUE CHAIN

The value of chain give in the case show that since its start, Starbucks has always been worried about develop a good product, with international influences, seeing that they have many stores across the globe. But, it is important to consider all the aspects of all the steps until the product can reach the customer. - Inbound Logistics Since 2010, the company has been restructuring their supply chain. The restructuring initiative of Starbucks Inbound Logistics involved simplification of supply-chain management and the creation of a single, global logistics system. Sourcing coffee from diverse coffee beans producers with whom they have great relationships and built up efficient supply chain management system. Bringing unroasted Arabica coffee from places as Asia, Africa and Latin America to Europe and US using big containers. These are delivered to regional distribution centres, where the coffee is roasted and packaged to be distributed. Along with coffees from regional distribution centres, central distribution centres also receive deliveries from vendors for a wide range of products starting from coffee machines to napkins.  As a suggestion that the company com pany has started exploring, is to have the opportunity to grow their own coffee. Such a shift in the sourcing of products can increase the effectiveness of new product development initiatives for the business, as the company will have a chance of experimenting with developing new sorts of coffee. - Operations Starbucks has operation in 60 countries with their stores being modelled on company operated stores and licensed stores. Organization operation-stores are are significant for the business since they empower the administration to watch moves in customer tastes and inclinations and gather data about market propensities all in all in an immediate way. By the end of fiscal year 2016 Starbucks had 12,711 company-operated stores, which accounts for about 51% of total numbers of stores. Company-operated stores generated 79% of Starbucks revenues during fiscal 2016. Regarding the licensed-stores, they represent around 49% of total numbers of stores. Revenues from licensed stores accounted for 10% of total net revenues in fiscal 2016. The company hasthe always aimed to have operating in the locates best locations, high-traffic and visibility. Varying size and format of itsstores stores, the company them in with or near a variety of settings, including downtown and suburban retail centres, office buildings, university campuses and in Marketing Strategies, Assessment No.1 v1.0 Last updated on 11/06/2019

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select rural and off-highway locations. Adding value to its operations, the stores provide an experience where customers can spend quality time and have access to a cool and relaxing environment with access to Internet. However, it would be a suggestion for the company to consider the option of Franchising would allow the company to open many new stores with less risk, and make considerable profits in doing so. Because of this the firm’s research and development costs wou ld fall making use of the franchisee knowledge of the local market in terms of geographic, psychographics, demographics, and the local country regulations.  regulations.  - Outbound Logistics Starbucks products can be purchase by the customer in any of its many stores. Online sales channel is also utilized by Starbucks for certain range of products such as packaged coffee, tea, drink ware and drink-related equipment. Also, the company uses some supermarket leading chains, as Walmart and Tesco; to sell a limited range of its products, such as coffee sachets.  sachets.   Despite the online options and affiliation with the supermarkets, most of its products are sold in-store and some through large box retailers. All the payments can be make through point of sale, prepaid Starbucks Cards and mobile payments.    Aside from supermarket chains that sell constrained scope of organization's items, the nonappearance of middle people, for example, affiliates or wholesalers is the fundamental wellspring of significant worth for Starbucks outbound logistics. The organization cooks its items in-house and sells without anyone else organization worked and authorized stores, accordingly keeping the edge that generally would have gone to wholesalers and affiliates.

- Marketing and Sales  As mentioned previously, until a few years ago, Starbucks was not open op en to invest in marketing. m arketing. The trust in the strength of the word-of mouth is has always been stronger and a cost-effective form of marketing based on high quality of products and high level of customer services was the main channel promoting the brand for years. However, with the continuously growing and intense level competition, the company and its senior management was motivated to reassess the marketing strategy Starbucks marketing budget has been consistently increasing during the last five years to reach USD 351.5 million for the fiscal year 2016. The total budget is divided and invested into different elements of print and media advertising, sales promotions, events and experiences, public relations and direct marketing. The focus and high level of integration of social media and technology into sales processes it is one of the most solid sources of the company’s value. The organisation has successfully implemented mobile order and pay system for its products and at the present moment, about 8% of all orders are Starbucks has “enabled orderslater via  Amazon’s placed via mobile In addition  Amazon’s announced that thedevices. feature would also ,be integrated into Ford vehicles this year.  year.   Alexa last year,

It would be interesting for the company to continue this investment and even plan to start being even more involved in new trends, as it is happening with the Amazon. Participating of big events or even sponsoring an idea, it would keep the brand in the media and in the customer’s mind. Nowadays,  

especially in countries as Australia, where the coffee culture is quite different from the American, earning loyal customers is a tiebreaker in the industry. It is not just enough to provide a good quality coffee and food, but also provide a more personal and welcoming experience to the customers. If the company can be more activate with the local communities and show the target that even being a huge company it also known how to keep the customer service close and personal, probably the company will bring their word-of-mouth strategy to a next level. - Service Having a superior customer services is the core source of Starbuck competitive advantage and this particular primary activity adds an enormous value to the brand image. Starbucks baristas are in every case amiably neighbourly and welcome regular customer by their names. Once in a while,

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standard client may get their regular coffee for nothing out of pocket at the circumspection of baristas as great motion and such acts increment the view of the administration quality to a significant degree.  degree.   Moreover, in the midst of regularly escalating boisterous nature of way of life and expanding pace of the arrangement of client administrations, administration at Starbucks is never surged. It has been appropriately noticed that "Starbucks invests a great deal of energy estimating and improving how well they coordinate their clients' speed desires —conveying a custom refreshment in only minutes they don't let the requirement for speed drain the life out of the Starbucks experience.

Identify your international marketing objectives and operational plan (5 marks): m arks): In this section you are required to discuss the following:   Marketing Objectives should have a (SMART) approach   International Marketing Activities and how that can be executed effectively   Forecasting any future risk and risk preparing management plan   Market promotion programs keeping in mind the cross-cultural communication and negotiation styles  

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In the Asian market, especially China and Japan, the fast growing competition has been a problem. But the real big failure for Starbucks has been in Australia. The company’s first appearance was in  Australia 2000, where it was able to grow until un til 90 stores around the continent by the end of 2008. But Starbucks moved too quickly, and grew faster than its popularity.  Australia’s already a lready-thriving coffee culture also proved to be a challenge for the American brand. The  Australian cafe industry got more than $6 than $6 billion in revenue in 2018. Starbucks didn’t fit Australians’

tastes. The company served sweeter coffee options than Australians preferred, all while charging more than the local cafes. In its first seven years in Australia, Starbucks accumulated  $105 million in losses, forcing losses,  forcing the company to close 61 locations.

 And that is why Australia is in the centre of the marketing objectives to be accomplished. So, as main m ain objectives, Starbucks is planning to: - Increase its sales in 20% in the Australian and Asian markets within 2 years; - Increase market share in the coffee scope globally, especially Australia; - Increase the amount of stores globally to 40,000 until the end of 2022; - Grow average customer spend by 10%. To reach these objectives, it is important to plan well its marketing activities and some market promotion programs. Starbucks predominantly uses its website, social media channels and in-store displays to promote prom ote the brand and the products. It also uses sales prom promotions, otions, events, direct marketing, print media, and PR in an integrated manner to multiply the impact of its promotions. Starbucks is known by is premium price. Year after year, the company only increases its prices, what have been causing of it losing space in the market for its competition. Price changings are necessary. The product prices are quite higher as compared to that of its competitors. Initiatives relating to cost reduction like rationalizing global retail network are implemented for improving profit margin.   Exploring different strategies is also important to try to grow in a tough market as the Australian. Using fear as a trigger can be a powerful action. Using the fear of people of missing out it is a great opportunity. According to research, to research,   60% of Millennials make impulsive purchases driven by fear of missing an opportunity. Employing time limited or bared promotions and a seasonal/occasional menu to create a sense of urgency in people’s minds is  an option. “Take the offer today (or right now) or it will be gone”. The company is also well known for its heavily content marketing strategies to attract customers and keep them engaged. Continue to engage in this strategy iis s also a very important part of its its marketing strategies plan. Their content has a certain quality, a certain look and feel to it that portrays a high Marketing Strategies, Assessment No.1 v1.0 Last updated on 11/06/2019

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image of the brand. Great options are creating challenges for the customers with rewards involved; linking promotions, special activities or even products to big events as Christmas or Halloween.  Halloween.   For all these ideas to work, it is also important to turn the marketing team into brand ambassadors, People who really believe in the brand and will work to bring the best to its work. Joining all that with a good PR job, that is normally a defect area in Starbucks is can really bring great results to the company’s performance in the market.

Every strategy though, has its risks. Increasing the investments in these markets and not obtaining the expected results can be a big blow to the organisation. That is why it is essential that the company to keep in mind that it is possible to happen. One possibility is overcoming the budget or the investments: is a big risk within any marketing plan.   Mistakes can happen anytime, but having a strong planning, good researches, and good people work behind the scenes, can avoid that the company has to spend more money that expected.  Another possible risk is the competition. In these markets the competition is getting stronger every year. After experiencing a big failure in the market, Starbucks has to keep going with the whole planning and always tracking the competition responses to its marketing strategies. Lastly, the cultural chock of not giving what those customers from these specific market are looking for. This can be another downfall for the brand. A good market research and a full understanding of these market and its customers is very important to avoid it to happening again.

Evaluating, measuring and monitoring marketing effectiveness (5 marks): In this section you are required to discuss the following:   Discuss customers value satisfaction   Marketing contribution to revenue and ROI   Changes in brand awareness   Marketing channels and platforms used and their conversion rate 

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Starbucks praise their customers in a high level service, providing the workers an extensive customer service training in order to make their experience the best experience possible. Also, the service is fast and the customers have the option to have loyalty plans, which give them good advantages when they are regulars. To measure and monitor that, it is important to always keep track in the online evaluation tools as the Social Media, Google and foods apps as Zoomato, to keep track and respond all the evaluation made it by the customers. For Starbucks, it is really important to keep a high level of customer’s value satisfaction, seeing it is one of the organisation differentials. With one shop opening every 15 hours in China, Starbucks marketing spreads worldwide and still keeps foreign countries to invest in the brand in their own soil. Their main revenue is the in store selling, which represents 91% of total revenue whereas the marketing revenue totalizes around 11%, which includes new customers, upselling advertised products and like mentioned before, new franchises around the world. The new results created by the marketing campaign and new strategies will result in return of the investment. Increasing the sales and the market share of the company, especially in countries like China and Australia in essential. Starbucks is a reference when it comes to coffee and it’s brand awareness can be a mind changing

when it comes to customers deciding from which brand they should buy their coffee, naturally because of the success of the company they are bound to go to Starbucks whenever they think about the name. But nowadays Starbucks, in order to keep growing, especially in countries like Australia, they need to adapt even more to the customers which are getting more demanding regarding the type of milks and dairy free products, they need to incorporate these healthy values into their brand to be even more prestigious in this scenario. Keeping track of the new trends and changes within the brand awareness is very important to continue its work.

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The brand started to invest heavily in marketing through social media recently, they appear on Facebook, Twitter, Instagram, Pinterest, Youtube and even on Google Plus. Not forgetting as well the email marketing. The focus on the Social Media will be Instagram and Facebook. The target uses these two medias to lookup for the best options for coffee and breakfast. So the investment to have a nice looking and appealing feed is very important. By doing so, they created an important customer engagement through their online marketing promotions. It is important to measure the conversion rate of these medias. How many people access their Facebook or Instagram page? How many people watch their stories? There is a lot of interaction between the customers and the brand in Social Media?  Also, as the compan company y is already fam familiar iliar with the traditional media, T TV V and print, the idea is continue to use it as a support to the other, not as a primary option. Seeing that most of the target it is concentrated in the Social Medias and Internet, the traditional medias will just reinforce the idea spread throughout the others.  After the new strategies take place, it is also important to analyse the competition response to that. They have changed their strategies? They react to the company’s changes? Were they affected by it?

This is also part of the plan success and important to learn what it worked and what to improve next.  A good way to accomplish all these is to have an Marketing Audit realised. It is simple a thorough evaluation of all aspects of the organization that can bring valuable results.

Identify Australian and International policies and legal factors affecting marketing operations (5 marks): In this section you are required to discuss the following:   environmental matters, human rights, labour relations in marketing   identify and explain key provisions of relevant legislation and codes of practice affecting aspects of marketing operations 

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The government, through its contracting rules guidelines and techniques, directs the manner in which organizations work with it. It not just effectively urges private companies to partake in communicating premium when it buys items and administrations, yet it additionally makes a huge effort and spends heaps of cash in effort projects to discover great, qualified independent ventures to be its providers so as to maintain a strategic distance from legitimate variables that would influence their business. Ordinarily, it gives data that encourages independent companies to offer with negligible hazard, along these lines dealing with the lawful factors in the business.  Any business that is organized as a legal element is liable to the state law that oversees its activity and direct. There are various sorts of business elements. For instance, organizations, restricted associations, organizations, constrained obligation organizations, restricted risk constrained organizations and constrained risk organizations all of which have distinctive lawful status and issues. On the off chance that a business is looking to get financing through various sorts of speculators, it might be liable to lawful issues, for example, security law. For example, a choice to offer promissory notes, a kind of credit to your financial specialists, will subject the legitimate factor influencing business to state and government guidelines and security laws. In addition, are also the contract laws. In the event that the company is to enter a contract with someone else or element, at that point contract law is authoritative. This additionally has a unique zone that is included straightforwardly with components influencing business, for instance, government contracts, which is otherwise called government acquisition laws. Regarding to employees and labour laws, it is important to consider a few things. Different governments have passed laws to protect the interest of employees. These laws ensure them against out of line based separation at things work and whenreligion, applying forage, employments. oppressed on such as race, sex, or colour. It guarantees that nobody is

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It is also primordial that the company considers the working conditions. According to the law, employees must receive protection when working with dangerous machines; at the workplace, employees should be given clothing and equipment that meet the highest safety standards; employees should have a reasonable temperature at their workplace; the highest hygienic standards at the workplace and washing facilities should be met for the sake of employees; employees to have enough breaking periods while working; business should uphold the freedom of association end effective recognition of the right to collective bargaining;   the elimination of all forms of forced and compulsory labour; the effective abolition of child labour.   When talking about labour laws, it is also important to consider the immigrants. There are special laws for them, especially in countries where they are allow to work by the law. Low payment rates and long hours are very common to happen seeing that most of the times the immigrants have to work to survive in a different country that may not give them fair opportunities. In this case, the immigrants provide a ready source of relatively affordable labour that keeps the cost of business low and elevating profits. The companies have to consider that are laws to protect them and they are people who also have rights, even not being citizens. In case of trading and consuming, the organisation has to keep in mind that they are specific laws for that: - Weight and Measures Act: These laws ensure that the goods sold are weighed on Standard weighting equipment; - Trade Description Act: This law ensures that it is illegal to deliberately give misleading impression about products;  products;  - Consumer Credit Act:  According to this Act, consumers should be given information of the credit agreement and should be made aware of the interest rates, length of loan while taking a loan;  loan;   - Sale of Goods Act: This Act declares that it is illegal to sell products with flaws or problems and that any goods sold conforms to standards.  standards.   All nations have ha ve their own environmental laws. But it is known k nown that, nowadays, all of them take it very seriously. Environmental protection is important to keep the world spinning, and to have a business an organisation has to take them into consideration. Some industry sectors are specially regulated. These regulations control the manufacturers and importers of hazardous substances, which normally need a registration, always following the rules of each country or region. Not every country allows the sale and commercialization of every substance. This is a health matter as well as environmental. When opening a business, a company has to consider how its products or services may affect the environment and if all its aspects are according the law. In the matter of marketing and advertisment, the company has to consider the follow: -orWhen promoting your products services, you need to ensure that any branding, statement, quote any other representation is not or false or misleading; - Component pricing is when the price of a product or service is advertised or displayed in separate parts. For example, when the single price of a car is displayed and additional on road costs are listed separately. If the company advertise using component pricing you must also provide the full price inclusive of additional costs in a more prominent way; - Must not do bait advertising, that consist in where a product is advertised at a certain price without a reasonable supply. Bait advertising is illegal if a business sells the product knowing that they cannot meet expected demand.

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SOURCES AND REFERENCES USED

1. https://www.investopedia.com/articles/forex/080613/effects-currency-fluctuationseconomy.asp   economy.asp https://www.focus-economics.com/commodities/agricultural/coffee   2. https://www.focus-economics.com/commodities/agricultural/coffee 3. https://www.businessinsider.com.au/starbucks-needs-to-fix-traffic-problem-20181?r=US&IR=T   1?r=US&IR=T 4. https://2012books.lardbucket.org/books/challenges-and-opportunities-in-internationalbusiness/s06-02-political-and-legal-factors-th.html   business/s06-02-political-and-legal-factors-th.html 5. http://www.supplychain247.com/article/starbucks_as_an_example_of_the_value_chain_mode l  6.

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APPENDIX

Include any attachments, facts, figures, pictures, diagrams, brochures, web screenshots, etc that you have discussed in your plan and may relate to explain the e-marketing plan more clearly.

 Appendix 1

Starbucks Financial Performance SOURCE: Starbucks` 10-K, 2017

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 Appendix 2

Coffee Consumption Growth

 Appendix 3

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Coffee Prices Note: Arabica Coffee prices, in USD cents per pound (lb). Daily prices.  

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