Introduction
Starbucks Coffee was founded on superior quality, environmental awareness, and client happiness. Recently, the business has fueled expansion by going beyond coffee and providing a growing menu with a selection of gourmet dishes. The extra goods muddle its reputation as a coffee brand and complicate its supply chain operations. Starbucks offered the usual Starbucks coffee menu in India, which was not successful. There is need for innovative ideas of services to attract more customers. This customer-focused company must use a range of marketing research methods. SWOT analysis is one of the methods which looks into the company’s market environment. Marketers use it to ascertain if the company’s new, expanding menu is positively or negatively impacting sales of its core products.
Strengths
Starbucks has a loyalty program and card. The renowned Starbucks card is usable across India, providing enormous prospects for consumer loyalty. Starbucks customers may redeem prizes from the loyalty program. Consequently, via a tiered structure, they can access their favorite Starbucks contributions, improving the whole experience. Starbucks Rewards is more than just a regular loyalty card for purchases. This reloadable credit card uses a gamification mechanism to award users stars for each transaction. The cards also have fascinating patterns, making them a magnificent present choice. The growth of the card and loyalty program has increased the number of users in India.
Starbucks has a wide range of foods on its menu. Tata Starbucks offers more than 20 choices for hot and cold coffee and tea in the beverages department. You may personalize your beverages at Starbucks, contributing to overall consumer happiness. Few sandwiches and pastries are available to assist satisfy every customer’s palate. The Starbucks name comes to mind when one considers enjoying coffee and delectable pastries around the globe. Due to westernization, the firm, the top American coffee brand, has significantly increased in prominence in India. Due to its broad menu, Starbucks coffee is what the whole globe consumes, which appeals to everyone in India who wishes to drink as Europeans do.
High average daily sales (ASPD). Starbucks’ ASPD is around 60,000 rupees. With between 15,000 and 20,000 sales per day, it is high when compared to Café Coffee Day. Starbucks announced a 30% topline gain in fiscal 2018–19, mostly due to strong sales from brand-new shop openings. High earnings were recorded by the corporation both at the store level and across all cities. An increase in the percentage of food sales in total sales is likewise seen as lucrative. With its present profitability, Tata Starbucks seems reliable in the fast-casual restaurant market and appears to double its profits yearly. Increased daily average sales around the globe bring about the gain.
Weaknesses
There is need to be more items in the food category in Starbucks menu. Despite Starbucks’ global sales explosion, Indians prefer to drink their food with their coffee. Because they solely sell coffee and tea, Starbucks is a coffee and tea shop. The Tata Starbucks Company’s universal standards for most goods are also a problem. Some items are out of step with other markets’ cultural norms. This fact can render the product unmarketable in certain parts of the globe. As a consequence, the average daily sales will decrease.
Starbucks lacks sufficient supporting documentation. The Indian Food Safety and Standards Authority has outlawed Starbucks’ application for product clearance. The company’s food product was rejected since there wasn’t enough supporting documentation for the safety evaluation. Thirty-four goods were rejected, including sea salt and red bean sauce.
Accordingly, the minister reaffirmed that the FSSIA’s main responsibilities include developing rules, establishing science-based food standards, and coordinating with the states on food safety. The company’s operations had a substantial impact due to the downturn.
Starbucks could have better, most distinctive items on the market. This reduces product imitation for other companies as a consequence. Nearly the same items are available at other restaurant chains and coffee shops. Additionally, Starbucks’ pricing is too expensive. Compared to other coffee shops, Starbucks goods are more expensive for the intermediate categories. High pricing makes products less affordable, driving away prospective buyers.
The beverage coffee is Starbucks’ main offering, although it also emphasizes tea and saps because of their rapid development. The emphasis will be on global expansion, which will lessen reliance on US markets. Its extensive collection of outlets in emerging markets needs to expand. The business should invest in digital technologies to increase client engagement and loyalty. In any case, this will enhance the clientele’s experience.
Opportunities
Starbucks is an ideal prospect for development into new areas because of the strength of its brand, even though it has lagged behind its competitors worldwide. Another potential the corporation may capitalize on is the growth of in-home brewing equipment like Keurig. Starbucks has recently had success in offering new products, but the company should be careful to stay within the product that has made it successful in the past. This is a fantastic revenue source, allowing Starbucks to take advantage of economies of scale when making purchases. Starbucks is well-known for the high quality of its coffee, but customers should be aware that this excellence comes at a cost. It should give lower pricing on different coffees to attract consumers and develop habits and trends they may continue to follow even when Starbucks is forced to increase prices once again progressively.
Threats
The greatest danger that Starbucks faces comes from its rivals, such as McDonald’s McCafe coffee, which provides high-quality beverages at far more affordable pricing than the industry behemoth. When the economy is in a downturn, people often reduce spending, which frequently includes cutting down on luxuries like specialty coffee. Although single-cup coffee machines provide cheaper home brewers, the fact that Starbucks sells single-serve coffee for these home brewers detracts from the company’s principal business of operating coffeehouses.
Alternatives
Starbucks has to put a high priority on listening to its customers and continuously improving both its goods and its processes as an alternative to improving its services. Simple tools and methods, such as suggestion boxes and consumer surveys, might prove beneficial for Starbucks. Launching a platform for open innovation will enable consumers and fans to offer their thoughts and recommendations for how the company’s most cherished goods may be made even better.
Conclusion
Starbucks must first distinguish its goods based on its image and then differentiate its products based on the items themselves. Starbucks will need help to distinguish their goods based only on quality, particularly in overseas countries such as Italy, which are well-known for producing coffees of a very high standard. Starbucks should distinguish its new goods based on their distinctive qualities and brand image. This strategy should be combined with the company’s research and development concentration on product creation and its goal of being the first mover in the market.
In conclusion, Starbucks has to market its brand more effectively as an experience. The experience that one has at a Starbucks store is the single most important factor in determining whether or not a consumer would return to that chain. Making a good first impression is essential to ensure that clients will return. By maintaining a marketing strategy based on product differentiation and brand identity, Starbucks can fend off the challenges of customer bargaining power, alternative goods, and rival firms.