Marketing Principles

Implementing Different Business Marketing Strategies

Introduction To Marketing Concepts

It is a science and art of exploring, creating and delivering value to satisfy the needs of a target market at a profit. The practices under marketing requires to implement at different stages while operating a business so that to promote the value of products and services. Marketing mainly focuses on promoting the products in customer’s mind for getting high profits with enhanced customer base. It comprises of different principles that can be used for different purposes. This is a beneficial process as it helps the business to attain competitive advantage and long term sustainability (Carlson and Manktelow, 2013).

The present research report from Instant Assignment Help UAE is being made with a view to figure out marketing concepts and its principles and its application in Starbucks. The report will further analyse segmentation, targeting and positioning strategies and its usefulness for Starbucks. Starbucks is undoubtedly one of the most successful coffee chains of the last few decades. This assessment seeks to explore the Starbucks brandscape through an external analysis of the economic, competitive, social, demographic, legal factors of the coffee market. Apart from this, Starbucks is one of the most socially engaged companies in North America (Waeraas and Solbakk, 2009). In order to attain long term sustainability, Starbucks needs to continually strive to be innovative and creative. Furthermore, range of factors that affects the consumer mind will be discussed in the subsequent research.

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Task 1 The Concept And Process Of Marketing

1.1 The various elements of the marketing process

According to “Marketing is the process that is required to undertake so that to maintain effective relationships with the customers and also to build competitive advantage”. The elements of marketing process have been divided into several steps such as:

Market research: Market research is the foremost activity that is required to be enforced in order to identify the availability of competition. This is also a useful technique as it assists in identifying the life cycle of the product (Schnnars, 1998).

Formation of specific strategies: Strategies are those guidelines that can help Starbucks to successfully introduce the product with segmentation, targeting and positioning process.

Elements of marketing mix: The elements of marketing mix play a crucial role in affecting the mindsets of the customers. At this step, effective strategies should be designed so that to place and promote the product.

Implementation: At this stage, Starbucks is required to implement the strategies effectively. This could also help the organization to facilitate change and improvements as per the requirements (Schnnars, 1998).

1.2 The costs and benefits of marketing orientation for Starbucks

Market orientation is the process which could help Starbucks to analyze the terms and conditions prevailing in the market. As far as marketing research is concerned, the process of market orientation can be implemented for building competitive sustainability. In such process, the likely outcomes of marketing activities can be identified. It is termed as a process whereby the organizational member identifies the strategies and policies of competitors to remain competitively in the market. The main objectives of Starbucks are as under:

  • To enhance the customer base
  • To develop the brand identify
  • To retain the workforces for longer period
  • To acquire long term sustainability in coffee market

It is beneficial but somewhere it is inappropriate as this requires much of resources and time. Besides this, marketing activities also have some limitation as well and some are stated as under:

  1. Lack of efficient talent
  2. Improper communication (Papadopoulos and Martín, 2011)
  3. Improper use of resources

With the help of market orientation process, demands of the customers can be identified and thus products can be brought as per the requirements. This can also assist Starbucks to bring quality products in the product line so that effective relationships can be maintained for long term (Wengrow, 2001).

SWOT analysis is that process which could help Starbucks to identify strengths, weaknesses, threats and opportunities and therefore effective strategies can be designed. This could also help in formulating various plans. Following is the SWOT analysis of Starbucks.

  • Brand name
  • Enhanced organizational configuration
  • Enormous competition
  • Lack of cheaper priced goods
  • Prospects of extension and diversification
  • Revenue generation through implementation of complex technology
  • Large number of foreign companies coming into market
  • Low monetary recovering

Task 2 Be Able To Use The Concepts Of Segmentation, Targeting And Positioning

2.1 How macro and micro environmental factors may influence marketing decisions in Starbucks

The external and internal factors of the environment need to be analyzed as this highly affects the marketing decisions. The subsequent research is emphasizing on three major factors of macro and micro analysis.

Starbucks and its organizational member could face issues in context of availability of competition. The policies and strategies of its competitors can affect the marketing decisions and also can impede the opportunities of growth (Schultz and Hatch, 2003).

Frequent change can be seen in the habits of customers with the changes in lifestyle and attitudes. The changing habits and needs of the customers highly affect the marketing decisions and practices and this also leads changes in production department. Strategies are required to update so that to cope up with changing demands.

The marketing decisions also get affected when suppliers restrict the proper supply of products and raw materials as this affects the production process.

On the other side, some of the macro factors that affect the marketing decisions are as:
The economic instability of the nation changes the economic conditions of the buyers and thus it leads to fewer demands.
Technological advancements highly affect the marketing decisions of Starbucks as it leads to put more efforts in developing efficiency level (Schnnars, 1998).
Political and legal factors highly influence the marketing decisions of Starbucks as this restricts the firm to enter into global market.
Different rules and regulations mentioned under contracts of EU should be followed by Starbucks so that to protect the business from legal issues.

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2.2 Segmentation criteria to be used for products in different markets

Market segmentation is ingenious strategy for Starbucks to fulfill their mission and gain profits. This is process of segregating the market into different segments on the basis of geographic, demographic and Psychographic segmentation. Starbucks can use demographic as well as geographic segmentation as it mainly targets youths and people who have high purchasing power (Racela, Chaikittisilpa and Thoumrungroje, 2007). With the help of geographic segmentation, Starbucks is able to reach towards the places at UK and this also helps the company to ascertain the needs and demands of different customers. Young adults, 18-24 age group people are the next large group that Starbucks targets. The last group which Starbucks can target is between the ages of 13-17. The company holds around 23% of market share for coffee in US. During a research, it has been observed that Starbucks targets men and women between the ages of 25-40 which probably half of its business. They appeal to this group through the growth of technology and innovative ideas. In order to attain competitive advantage, demographic and geographic segmentation criteria would be the favorable one as this helps in persuading the customers towards different products of Starbucks (Papadopoulos and Martín, 2011).

2.3 Targeting strategy for selected product

Coffee consumption in US has been trending down since few years. Starbucks is extremely vigilant in selecting its target markets. In order to attract large number of customers, Starbucks were trying to recreate a new coffee culture in America. Hence they have low barriers for entry. They have maintained effective relationships with the suppliers and similarly they do not have any real competition threats (Page and Brewster, 2007). Starbucks can target office workers, with middle to high incomes, who had a desire to purchase premium products. High consideration needs to be paid on quality aspects so as to raise customer base. They also need to pay a great deal of attention towards effective infrastructure. As Starbucks is targeting youngsters therefore organization can use undifferentiated marketing strategy and this can create and maintain the marketing mix considering the market as a single market. Youngsters have been targeted as the most frequent users who consume coffee even twice a day. A major difficulty in using this targeting strategy is developing the brand to satisfy all consumers. The company can use such strategy without compromising on quality concepts. 15 new stores are about to open in the upcoming years (Pagano, 2009).

2.4 How buyer behaviours affects marketing activities in different buying situations

The main factor that highly affects the marketing decisions of Starbucks is changing needs and demands of the customers on frequent basis and thus it leads to put extra efforts on production process. Buyers are significant for the company as they help in attaining long term sustainability and competitive advantage (Nwankwo and Gbadamosi, 2010). Personal, social and other factors highly affect their preferences and thus it changes their way of living. As per the targeted customers, kids consume coffee at the time when they usually go for movies and youngsters go for coffee when they have business deals as well as party time thus quality is the major facet that attracts range of customers; therefore Starbucks should develop some strategies related to maintain the standard of services. However, motivation also affects their purchasing decisions and for such purpose, Starbucks needs to organize several events in which usefulness of the product can be promoted. Customers always tend to look for convenient goods; therefore Starbucks is required to consider this facet (McLeish, 2010).

2.5 Propose new positioning for a selected product/service

After deciding the target market, Starbucks must decide what position it wants to occupy in the target market. In order to place the product successfully in the market, it is required for Starbucks to implement suitable positioning strategy as it also helps to build competitive advantage (McDonald, 2012). Starbucks tries to position them as a premium product in the coffee industry by creating a high standard, introducing innovative products and providing excellent services. In order to attain the market goals, the team members carefully monitored each and every step of coffee production. For proper positioning, Starbucks can introduce range of new products such as strawberry and cream Frappuccino, cookies, pastries, sandwiches and salads in the prevalent product line. Besides this, promotional tactics should be selected in such a way that it can change the mindsets of the customers. This represents that probable techniques should be used so as to create exact image of the company at the market place. On the other side, low pricing strategy can also be adopted so as to capture market share (Malefyt, 2009).

Task 3 Understand The Individual Elements Of The Extended Marketing Mix

3.1 Development of Product to Sustain Competitive Advantage

In order to sustain competitively at the market place, it is essential for Starbucks to manage its competencies efficiently. New product development is the concept which helps Starbucks to widen or expand the product line as this facilitates to bring new and attractive products. Quality aspects is considered as one of the most significant facets that needs to be maintained as it is helpful in attaining long term sustainability. Product differentiation is also the other most imperative facet that tends to attract large number of customers; therefore competency can be enhanced (Lehmann and Keller, 2006). Introducing hot chocolate with cheese will help Starbucks to acquire competitive advantage as it has been evaluated that Costa Coffee and Barista both are known about the same product. Market research and competitor’s analysis is beneficial for such purpose as this assists in identifying competitor’s strategies. Starbucks pays attention towards effective and timely services so as to retain potential customers.

Moreover unique facilitates has been arranged for potential customers such as discount coupons and other attractive schemes. Introduction of cheaper products has also developed opportunities of competitive advantage as this also persuades different types of customers. The practices under the concept of branding have been undertaken so that to build up brand awareness among different customers (Kotler and Pfoertsch, 2006).

3.2 Arrangement of Distribution to meet Customer Convenience Requirements

Proper channel of distribution is the best convenient way to retain customers. Effective channel of product distribution should be there so that Starbucks can render effective and competitive services as compared to the other coffee brands. Using multiple distribution channels allows the company to reach a wider market, however, while doing so Starbucks needs to careful with this approach due to the potential for channel conflict. Currently Starbucks is using intensive distribution strategy which persuades range of customers as this is a technique in which business sees its product sold in as many outlets as possible.

Starbucks uses multiple channels of distribution for its products (Keller and et. al., 2011). Different mediators can also help the company to enhance their customer base. However, Starbucks also sells its products in supermarkets and shopping centres. Additionally, Starbucks has distribution agreements with coffee suppliers, hotels, and airlines. With the help of intensive distribution strategy, customers of Starbucks can avail the goods at different places. Moreover, online services could also be provided so that to reduce extra operational costs as it is also convenient for the customers to buy services anywhere. Apparently, marketing or promoting the products in shopping malls and university can also help Starbucks to deliver services conveniently (Kapferer, 2008).

3.3 Evaluate Pricing Strategy adopted to fulfil Organisation’s Objectives and Market Conditions

Being the leader of coffee market, Starbucks controls several times more market share than any of its competitors. One of the critical aspects of marketing is pricing. This is the concept where margins are made, cash flow is generated and businesses grow. Starbucks significantly claims that value based pricing can help the business to maximize profits and also to enhance market share. They use research and customer analysis to formulate targeted price that captures the highest amount that consumers are willing to pay without driving them off.
Prices should be determined after analysing the competitor’s prices so that to attain maximum amount of customer base. Starbucks coffee maintains an inelastic demand curve and a small price increase can have a huge positive impact on their margins without decreasing demand for other products. Starbucks understands the majority of their customer base is moderately insensitive to price, thus uses small price increases that everyday consumers barely notice to boost margins. Prices should not be raised as per the market conditions as this affects the customer’s mindset (Caemmerer, 2009). Starbucks has been using price penetration strategy in which they provide products at lower cost only at initial stage and after acquiring expected market share, the firm gradually increases prices of product. For hot chocolate with cheese Starbucks can use price skimming strategy in which they can set relatively high prices so as to maintain standards and after a period of time they lowers the price over time.

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3.4 Integration of Promotional Activities for achieving Marketing Objectives

Promotional techniques are considered as the most effective tool that helps Starbucks to introduce the products successfully at the market place. The promotional element is imperative in attracting customer interest and persuading customers to buy the products. Promotional strategies mainly focus on giving information to the customers about the products as it includes strategies of advertising, personal selling, sales promotion and public relations (Brooksbank, 1990). As with Starbucks’ advertising, message is promoted to the customers regarding the usage of products and thus it integrates the product and price mix of marketing. It integrates the pricing strategies with low prices and place strategies with store’s convenient location. Personal selling involves sales representative to use skills for the purpose of attracting customers and thus it integrates product and place strategies under marketing mix. Sales promotion strategies of Starbucks include those strategies wherein coupons and discount schemes can be offered to the customers for the purpose of product promotion. These tactics integrates with the overall pricing strategies of Starbucks, but they can also integrate well with the product and place strategies such as coupon can attract customer to buy a product, whereas store wide sales can generate publicity for the store location (Benson and Barclay, 1990).

3.5 Elements of Extended Marketing Mix

In order to achieve marketing goals and objectives, it is essential for Starbucks to include elements of extended marketing mix so that to develop the sales of products and services and this is also helpful in attaining competitive advantage.

People: People are considered as the most significant element under marketing mix of Starbucks as they assist the company to raise the customer base. In order to render hot chocolate with cheese, it is required to arrange effective facilities (Banerjee, 2009).

Process: Process considers significant guidelines that help the business to improve some of the current practices. Proper process should be there regarding effective delivery of services through online to the customers and also to maintain queues of targeted customers.

Physical evidence: Starbucks provides information about its products, business partnerships, and career opportunities on its website. It is the most affecting and intangible factor comes under service sector. Starbucks is paying high attention towards the interior part so that to make the location highly attractive (Badur and, 2011). The customers of hot chocolate with cheese can acquire the product from shopping malls, nearby the schools as per the targeted customers.

Task 4 Be Able To Use The Marketing Mix In Different Contexts

4.1 Planning Marketing Mix for two different segments in Consumer Markets

The elements of marketing mix play an imperative role in persuading the customers towards the products. In order to segment the market, different criteria can be used but in the subsequent research report, income and age categories have been considered. For the purpose of targeting the income groups, more flavours can be added in the high ranged products of hot chocolate with cheese and for age groups; different flavours can be added in the existing product line. Products should be introduced after considering the preferences of the customers. Prices should be determined after as per the purchasing power of the customers (both the targeted customers). Starbucks can adopt online promotional strategies so that to reach towards range of customers through social media sites and other sites as this will help the firm to grab as many customers as they can. Products should be placed on the convenient places and special outlets should be promoted in shopping malls and nearby the schools (Target Marketing, 2013). Currently Starbucks uses geographic segmentation based on preferences of youngsters and thus large number of coffee shops has been opened nearby college campus and universities.

4.2 Illustrating the differences in marketing products and services to businesses rather than consumers

Business to consumer market: The main purpose behind marketing activities is to serve the customers effectively. The concept refers to the tactics and best practices used to promote products and services among consumers. It is different to B2B marketing as it often depends on campaigns (Schoppe, 2012).
Business to business market: B2B describes commercial transaction between manufacturer and wholesaler, wholesaler and retailer and manufacturer to retailer. It is the business concept in which products and services are sold from one company to another. Most business buyers demand that the product they buy meet strict standards. For instance- taking the case of Ford Company, this organization is involved in both B2B and B2C marketing. In case of company’s B2B marketing, the idea of an impulse buy is almost non-existent. Proper chain of command is followed by Ford before purchasing raw materials. This increase the direct time as it facilitates upon how number of levels the purchase must go through for the purpose of approval (Product positioning in Five Easy Steps, 2005).

4.3 Showing how and why International Marketing differs from Domestic Marketing

International and domestic marketing are alike as far as the elementary concept and principles of marketing is concerned. Entering into the global market can help Starbucks to avail maximum opportunities of success and growth. While entering into the global market, Starbucks has used global marketing strategies and generic strategies which helped Starbucks in comprehending different approaches to globalization. It helped the company to differentiate the products and services and ways to compete. However there are some noticeable differences such as the scope of international marketing is incessant with numerous opportunities whereas domestic marketing is very limited (Marketing strategy, 2009). Interferences from political parties in domestic marketing do not impact the business functions whereas international marketing results in the improvement of political relations between the other nations coupled with higher cooperation. As far as technology is concerned, in domestic market use of technology is narrow whereas international marketing enables the usage as well as sharing of the most recent and avant-garde technologies (Target Market, 2013). While entering into the global market, Starbucks has used global marketing strategies and generic strategies which helped Starbucks in comprehending different approaches to globalization. It helped the company to differentiate the products and services and ways to compete.


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