Overview of Starbucks
General introduction
Starbucks is a famous coffee brand in the world, headquartered in Seattle, Washington, USA Starbucks, formerly a coffee shop in Seattle, Washington, was born in
In 1971, two teachers and a writer collaborated to open Starbucks, a coffee and tea store United by their passion for tea and coffee, they pooled their resources to establish a business specializing in coffee drinks, tea beverages, and snacks This partnership laid the foundation for Starbucks as a popular coffeehouse chain rooted in a shared love for quality beverages.
The first Starbucks coffee shop was established at 2000 Western Avenue (Seattle, Washington) on March 30, 1971 by 3 people: Jerry Baldwin - English teacher, Zev Siegl - history teacher and Gordon Bowker - home Literature.
Inspired by Alfred Peet, founder of Peet's Coffee & Tea, the Starbucks founders originally purchased green coffee beans from Peet's Some time later, the shop moved to
1912 Pike Place, where it still exists, and they also started buying beans directly from the farms.
Founded on March 30, 1971, in Seattle, Starbucks originally started as a small shop specializing in premium coffee and coffee grinding equipment The company's history shifted significantly when Howard Schultz, the renowned CEO, recognized the potential of introducing Italian-style coffee service to the United States, transforming Starbucks into a global coffeehouse brand.
Howard Schultz joined the company in 1982 as Director of Retail Operations and Marketing Inspired by a trip to Milan, Italy, he proposed diversifying the product line to include both coffee beans and ground coffee, aiming to expand the company's offerings However, the owners rejected this idea, believing that entering the beverage business would steer the company away from its original focus.
Although they traditionally prepare coffee at home, they decided to offer customers samples of their freshly made drinks This move opens up new revenue opportunities through selling pre-made beverages Schultz launched the Il Giornale coffee bar chain in April 1986, marking a significant step in expanding coffee retail options.
In 1984, the original owners of Starbucks, led by Baldwin, took the opportunity to buy Peet (Baldwin was still active there).
In the 1980s, Starbucks was renowned for offering exceptional employee benefits, including health insurance and the opportunity for part-time bartenders to purchase company stock However, the company has also faced protests related to fair trade policies, industrial relations, environmental impact, political stances, and anti-competitive practices, highlighting ongoing debates over its corporate social responsibility.
- Field of activity: Food service
Vision and mission
Starbucks' mission statement is: "Inspire and nurture people - one person, one cup of coffee, and one neighbor at a time" Here are tenets of how Starbucks works every day
At the core of our mission is a unwavering commitment to quality, passionately sourcing the finest ethically-sourced coffee beans We meticulously roast each batch with exceptional care to ensure the highest flavor and freshness Our dedication extends beyond the beans—we aim to improve the livelihoods of coffee growers and promote sustainable practices in the coffee industry With a relentless focus on excellence, our work to deliver premium coffee and support ethical sourcing continues tirelessly.
At our core, partnering with others is both our responsibility and our passion, driving us to foster meaningful collaborations We celebrate diversity to create an inclusive environment where everyone can be authentic and valued Respect and dignity are fundamental principles we uphold in all interactions, holding ourselves and our partners accountable to these high standards.
When fully engaged, we create meaningful human connections by socializing, smiling, and enriching our customers' experiences, even if only for a few moments While it all begins with the promise of a perfectly brewed beverage, our true focus extends beyond the drink to building genuine relationships This dedication to connection enhances customer satisfaction and fosters loyalty, highlighting the importance of authentic service in every interaction.
Our stores create a welcoming environment where customers feel a sense of closeness and comfort, making them a haven away from outside worries They are ideal places to meet friends and enjoy the simple pleasures of life, whether slow and flavorful or lively and fast-paced Always infused with warmth and human connection, our stores embody a space that celebrates the diverse rhythms of daily life.
Each store is an integral part of its community, and we are committed to being responsible, respectful neighbors Our goal is to foster welcoming environments wherever we operate, serving as a positive force that unites associates, customers, and local communities By building strong community relationships, we aim to create a positive impact and promote mutual trust and support.
Our team contributes daily, recognizing that our responsibility and potential for positive impact are greater than ever The world now looks to us to set a new standard, and we are committed to leading by example At Starbucks, we embrace our role in shaping a better future through continuous dedication and innovation.
Distributing our products in these targeted regions guarantees success and delivers significant value to our shareholders We are committed to ensuring all necessary elements are in place to support Starbucks' growth and sustainability By focusing on strategic regional distribution, we enable Starbucks to reach more customers, thrive in competitive markets, and secure long-term success for all stakeholders.
Starbucks is committed to playing an environmental leadership role in all aspects of our business.
● Understand environmental issues and share information with our associates.
● Develop innovative and flexible solutions to change.
● Striving to buy, sell and use environmentally friendly products.
● Realizing financial responsibility is essential to our environmental future.
● Make environmental responsibility a company value.
● Measure and track our progress for each project.
● Encourage all associates to participate in our mission.
Brand logo
The first Starbucks logo, introduced in 1971, was inspired by the sea and featured a mermaid with two tails, rooted in Greek mythology The original design showcased a topless mermaid with two tails, primarily using the colors brown and white This iconic logo reflected Starbucks' maritime heritage and set the foundation for its recognizable branding.
In 1987, the brand updated its logo with new colors—blue, black, and white—introducing a more modern and refreshed look The mermaid image was redesigned to appear more delicate and discreet, with her long hair now covering the front of her chest for a subtle effect The overall lines of the logo became simpler and cleaner, featuring fewer cumbersome details compared to the previous design, enhancing its elegance and modern appeal.
In 1992, the iconic mermaid image underwent subtle modifications, including a closer zoom on her face and a simplified design of the two fishtails, resulting in a more streamlined and modern logo.
In 2011, Starbucks simplified its logo by removing the brand name and decorative star image, retaining only the iconic mermaid symbol The updated logo features a minimalist design with a streamlined color palette of white and green, emphasizing the brand's core identity and modern aesthetic.
Starbucks' international business strategy and method of entering the
Analysis of globalization strategy
2.1.1 Overview of Starbucks' globalization strategy
For big brands like Starbucks when conducting international business strategies, they always set clear strategic goals:
- Firstly, the most important goal of Starbucks is to maintain the image of a famous and expected leading brand in the world.
Starbucks continues to expand into new markets while firmly prioritizing brand integrity by preserving traditional products that define its identity The company ensures that each store offers unique experiences that attract and retain customers, maintaining its reputation for quality and consistency across diverse regions.
- Third, Starbucks wants to be a business that is socially responsible and committed to social issues.
In its early years, Starbucks revolutionized American coffee culture, transforming coffee from a simple beverage into an essential part of everyday life The brand played a pivotal role in elevating coffee from a basic daily staple to a popular social experience, making coffee shops a ubiquitous presence across the United States Today, Starbucks stands as a symbol of America's vibrant coffee culture, reflecting how coffee has become an integral and beloved aspect of American lifestyle.
Starbucks attracts customers by offering high-quality espresso made from the finest Arabica coffee beans The company sources its Arabica coffee exclusively from highland regions, ensuring premium flavor and durability during the dark roasting process This careful selection and roasting method enhance the rich, distinctive taste that Starbucks is known for, making it a preferred choice for coffee lovers worldwide.
Since its founding, Starbucks has evoked the spirit of traditional seafaring coffee merchants, with its logo symbolizing this heritage through the iconic Siren— the goddess of love Over four redesigns, the mermaid image has become a storyteller, embodying Starbucks' journey into the future while honoring its past The fishtail is free, representing freedom and exploration, inspiring customers to seek new horizons and inspirations beyond their imagination.
The Starbucks logo features a vibrant green color that symbolizes freshness, health, and calm, making it an attention-grabbing choice This green hue not only stimulates appetite but also reflects Starbucks' commitment to being an environmentally friendly, green business that prioritizes community well-being.
Starbucks is widely recognized for creating a "third place" beyond home and work, offering a social space where people can relax and escape daily pressures This innovative concept has contributed significantly to Starbucks’ success by providing an environment for social interaction, enjoying coffee, and listening to music No other company has leveraged music as effectively as Starbucks, making it a key element of their unique customer experience and brand identity.
Starbucks, the world's leading specialty coffee retailer with over 33,833 stores globally, has recognized that customers prefer familiar songs regularly played in their stores This strategic choice contributes to creating a welcoming and consistent ambiance, which has been instrumental in building the strong and recognizable Starbucks brand system today.
Starbucks' brand positioning is reinforced through strategic store space, thoughtful store layouts, and policies that prioritize employee care and community engagement These initiatives not only foster employee happiness and motivation but also inspire customers through exceptional coffee offerings As a result, Starbucks has built a strong reputation as one of the world's most valuable and recognizable brands, with notable success in markets such as China, Japan, and Korea.
A key limitation of Starbucks' globalization strategy is its rigidity in entering new markets, often offering products that are identical to those in the US without tailoring to local culture This approach led to poor market adaptation, as seen in Australia where Starbucks failed to resonate with local consumers due to a lack of cultural understanding The Australian experience taught Starbucks the importance of customizing offerings to fit local habits and preferences to compete effectively with established local cafes.
2.1.2 Business strategy activities of Starbucks
For Starbucks' strategic business activities, the brand has been flexible, and especially focused on developing and improving the following activities:
● Starbucks has always focused on product research and development to bring customers the best products and services.
Starbucks has enhanced customer convenience by installing automatic coffee machines at 800 locations, significantly speeding up service Additionally, the company has implemented prepayment by card, enabling transactions from $5 to $500, which has reduced transaction times by 50% To date, Starbucks has issued up to 70 million prepaid cards, further streamlining the purchasing process and improving overall efficiency.
Starbucks has launched an innovative offering with Starbucks Express Coffee, revolutionizing the customer experience by combining online ordering with rapid express delivery This groundbreaking service enhances convenience for customers seeking high-quality coffee on-the-go, marking a significant milestone in Starbucks' product innovation and digital transformation efforts.
Regarding technology and technology activities in Starbucks' business strategy, this brand is one of the leading coffee brands in digital transformation.
Starbucks Rewards program, along with its electronic payment system and mobile ordering app, has enabled the brand to gather extensive customer data and better understand customer segments In 2017, Starbucks embraced the 4.0 digital wave by launching My Starbucks Barista, a virtual assistant that allows users to order and pay via voice communication, enhancing customer convenience This innovation provides customers with a personalized experience that mimics the friendly interaction of chatting with a real barista, strengthening brand engagement through seamless technology integration.
● Starbucks is striving to be the leader in Wi-Fi hotspot performance.
At Starbucks, employees are known as “colleagues” and, regardless of their part-time status, they are eligible for company stock and insurance benefits During economic crises, while many retail companies lay off large numbers of employees, Starbucks remains committed to investing in its staff through comprehensive skills training, including barista courses Additionally, some of these training programs can be converted into university credits across numerous universities in the US, highlighting Starbucks’ dedication to employee development and career growth.
● Former company director, Howard Behar believes that employees who are well taken care of and feel satisfied will take care and provide the best customer experience.
● About how to manage Marketing in Starbucks' business strategy, this brand has implemented its Marketing strategies according to the Marketing Mix 4P model.
When analyzing Starbucks' marketing strategy for products, Starbucks used the strategy of product diversification to attract customers and serve the diverse needs of target customers.
● In addition to products sold year-round, Starbucks constantly renews its products and product lines with seasonal products, limited edition products, festive products, and more.
Starbucks distinguishes itself by offering a diverse range of high-quality products, including aromatic coffee, unique-flavored cakes, and teas The company continually strives to enhance the quality of its offerings and customer service, ensuring a memorable and satisfying experience These commitment to premium products and professional staff are the key Unique Selling Propositions (USPs) that help Starbucks attract and retain loyal customers worldwide.
Starbucks employs a premium pricing strategy to position its brand as a provider of high-quality coffee products By setting higher prices, Starbucks aligns with consumer perceptions that higher cost equates to better quality, appealing to customers who value premium experiences This approach leverages current consumer behavior trends that associate expensive prices with superior value, strengthening Starbucks' image as a luxury coffee brand.
21 products will have high value, which has helped Starbucks brand maintain the image of a premium and extremely high-quality beverage brand.
The wide distribution system is one of Starbucks' effective marketing strategies As the Internet grew, Starbucks offered products in Starbucks Online stores.
Analysis of localization strategy
Following its failed attempt in Australia, Starbucks recognized the need to revamp its operations and customer service to prevent decline The company embraced a localization strategy, understanding that adapting to regional tastes is essential for success By tailoring its offerings and store experiences to each market, Starbucks aims to better resonate with local customers and boost its global presence.
2.2.1 Localization strategy in Vietnam market
Although Starbucks is a famous coffee brand, however, in order to penetrate the Vietnamese market, there must be a certain strategy As follows:
Expanding your product offerings is a key strategy to grow your business Starbucks is actively diversifying beyond traditional coffee by launching a variety of new product lines tailored to different customer segments In addition to coffee and coffee-related items, the company has introduced products like wine and desserts, such as cakes, to attract a broader audience Furthermore, Starbucks enhances the in-store experience by offering music, creating a more inviting environment for customers.
Starbucks offers a diverse coffee menu featuring espresso drinks, chocolate-infused beverages, and Frappuccino ground coffee and mixes, ensuring a wide variety of unique flavors Their extensive menu also includes a selection of expertly crafted teas blended with hundreds of different recipes, providing countless innovative and flavorful options for every customer.
Starbucks' menu also has an additional food menu with cakes and sandwiches made with simple ingredients but delivering high-quality products.
To enhance its presence in the minds of customers, Starbucks has invested in brand promotion strategy Specifically:
● Increased use of social networking apps
Vietnam has a rapidly growing online presence, with 39.8 million Internet users, representing 44% of the total population and a 10% increase year-over-year Currently, approximately 28 million active social media accounts are registered in the country, highlighting the widespread adoption of social platforms Vietnamese users spend an average of 3 hours and 4 minutes daily engaging with social networks, emphasizing the importance of digital connectivity in the region These statistics demonstrate Vietnam's expanding digital landscape and the significant opportunities for online engagement and marketing.
Starbucks leverages social networking sites like Facebook, Twitter, and Instagram by launching targeted incentive programs that encourage user engagement Through promotions that reward likes, shares, and comments, Starbucks enhances its online reach while nurturing coffee-drinking as a enjoyable habit and hobby among customers These social media campaigns not only provide customers with exclusive incentives but also strengthen brand loyalty and expand Starbucks' digital presence.
Not only stopping there, Starbucks also shared many photos and moments of customers enjoying relaxation while enjoying coffee, to inspire coffee drinking to customers.
● Use word of mouth marketing
Starbucks has established itself as a leading brand in the field of experiential marketing, successfully creating a loyal customer base worldwide John Writer Smith exemplifies this loyalty through his extensive collection of stories and photographs documenting his visits to over 4,500 Starbucks locations across North America and 213 stores internationally His website, StarbucksEverywhere.net, consistently ranks in the Top 10 Google search results, serving as a powerful free advertising platform that enhances Starbucks' global brand presence.
Not only that, Starbucks also uses word of mouth marketing strategy to create a community of Starbucks addicts on social networking sites.
Starbucks offers multiple convenient payment options, including cash, electronic wallets like Momo and ZaloPay, and online ordering through delivery platforms such as Grab and Shopee Now Since 2011, Starbucks has enhanced customer experience by launching the Starbucks® app, enabling users to order and pay online seamlessly by linking credit cards, Apple Pay, and Chase.
Customers can pay using their membership card and earn 2 stars for every $1 spent, which can be accumulated and redeemed for free food, drinks, or even products outside the Starbucks system This loyalty program offers a rewarding experience, encouraging repeat visits and increased spending By earning bonus points with each purchase, members enjoy flexible redemption options that enhance their overall customer experience.
Figure 2.2 Starbucks uses its own app to make payments convenient
In today's era of rapid technological advancement, Starbucks has expanded its payment options beyond traditional cash and credit cards Since launching its mobile app in 2011, the company has integrated various digital payment methods, including popular e-wallets like MoMo and ZaloPay Additionally, customers can now conveniently order online through delivery platforms such as Grab and Shopee Food, ensuring a seamless and flexible payment experience.
● Take advantage of the influence of the star
Starbucks leverages celebrity influence by sharing news and articles featuring stars holding Starbucks drinks, creating a strong association between fame and their brand Images of celebrities spotted with Starbucks coffee reinforce the perception of the brand as a desirable, luxury choice accessible to the everyday person This strategic use of star power is a cost-effective way for Starbucks to boost its image and appeal, blending the allure of celebrity glamour with everyday enjoyment The widespread admiration of Starbucks by celebrities enhances its reputation as a premium yet relatable brand for consumers.
Figure 2.3 Female singer Dong Nhi next to Starbucks products
Starbucks enhances its brand image by actively engaging in social initiatives that benefit the community, including supporting and donating to migrants and refugees, advocating for basic human rights, and combating racism and discrimination against LGBT individuals.
2014, Starbucks Vietnam sponsored the study expenses for 10 girls at the "Room to Read" organization.
● Starbucks brings clean water to disadvantaged communities in Vietnam
Figure 2.4: Children of Minh Phu Primary School, Phu Tho receive clean water from the project on March 21
Despite challenging years marked by the COVID-19 pandemic, Starbucks Vietnam remains committed to community support by implementing projects that aid schools and children in underserved areas, providing access to clean water and promoting education on safe, hygienic practices.
This program is part of Project 24 of the non-profit organization Planet Water Foundation, sponsored by Starbucks Foundation and Starbucks Vietnam.
Figure 3.3 Starbucks Vietnam staff directly implement the project.
Over the past two years, students in Hung Yen, Binh Phuoc, Lam Dong, Hoa Binh, and Phu Tho have gained access to clean water through dozens of AquaTower water purification systems, supported by Starbucks Vietnam Notably, all community volunteer activities are directly carried out by Starbucks Vietnam staff, ensuring genuine commitment and impact without external authorization.
2.2.2 Advantages and challenges of Starbucks when entering the Vietnamese market
Starbucks' emphasis on "respecting the coffee culture of the Vietnamese people," as stated by Mr John Culver, President of Starbucks China, highlights their commitment to a local culture-based business strategy as they expand into Vietnam, their 12th Asian market However, this approach presents challenges, as the Vietnamese coffee culture revolves around savoring bold, dense, and bitter flavors through slow sipping—qualities that differ from Starbucks' typical offerings Successfully integrating into the Vietnamese market requires adapting to these local preferences while respecting longstanding coffee traditions.
Starbucks' success in Asia is primarily driven by the China market, where the brand has established a strong presence Recently, Starbucks has expanded into India through strategic joint ventures, further solidifying its foothold in the region Unlike its approach in China and India, Starbucks entered the Vietnamese market by licensing a single company, Coffee Concepts, to develop and operate Starbucks coffee shops across Vietnam.
Evaluation of Starbucks' international business
Advantages of doing business internationally
The company has expanded its strengths to international markets by establishing production facilities, implementing advertising strategies, and tailoring product messaging to align with local preferences, mirroring its domestic marketing approach Leveraging extensive manufacturing experience, unique product advantages, and technical expertise, the company effectively competes in global markets and enhances its international presence.
The company quickly and effectively applied technology applications in the business process right from the time it entered the Vietnamese market.
Catch the opportunity and be flexible in the 4.0 era in Vietnam.
Disadvantages of doing business internationally
The company's products utilize the same model across all markets, employing uniform marketing strategies While this approach addresses the most common consumer needs globally, it falls short in meeting the unique and specific requirements of individual regions Customization is essential to better satisfy regional preferences and increase market competitiveness.
The company has established overseas factories to produce domestically made products, which prevents it from benefiting from experience and cost savings associated with local production Implementing an international strategy in markets with strong local pressures can weaken the company’s competitive advantage, as competitors tailored their products and marketing strategies to meet specific local needs Adapting to local requirements in marketing, distribution, and promotion is crucial for maintaining a competitive edge in foreign markets.
Proposed Solutions
Starbucks should have a marketing strategy, promotion, suitable for each different region. Find distributors of cups and mugs in Vietnam to reduce business costs.
Innovating a little on the company's product model to suit each business area
Starbucks is a global leader in coffee and food, renowned for its high-quality products With over nine years of presence in Vietnam, Starbucks has gained the trust and loyalty of both Vietnamese and international customers The brand's coffee offerings are especially popular among Vietnamese consumers, reflecting the country's deep-rooted coffee culture and traditional preferences.
Starbucks has strategically launched coffee products tailored to Vietnamese consumers by thoroughly analyzing the local environment and coffee market This targeted approach has enabled Starbucks to effectively enter and establish a strong presence in Vietnam As a result, the brand has successfully penetrated the Vietnamese market and continues to expand its product offerings, demonstrating impressive growth and market development.
Based on a thorough analysis, our team has evaluated Starbucks' business strategy and market entry approach in Vietnam The findings indicate that Starbucks' operations in Vietnam are highly successful, solidifying its position as a leading global coffee brand Starbucks' effective market penetration and strong product offerings have contributed to its prominent presence and outstanding performance in Vietnam's competitive coffee industry.
[1] Uyen Hoang, Pestle Analysis of Starbucks coffee (August 4, 2020), https://www.saga.vn/phan-tich-pestle-cua-starbucks~46191
[2] Overview of Vietnam, World Bank in Vietnam, updated on April 14,
2020, https://www.worldbank.org/en/country/vietnam/overview#3
[3].Thanh Ngan, Essay on strategic management, March 20, 2020 https://tailieu.vn/doc/tieu-luan-mon-quan-tri-chien-luoc-cong-ty- starbucks-coffee-2229340.html
[4] Learn about the coffee market in 2020 (August 27, 2020) https://cafesach.com.vn/tim-hieu-thi-truong-ca-phe-2020
[5] Quang Anh, IGENZ, Analysis of Starbucks' 4P Marketing mix strategy, October 16, 2021, https://igenz.net/chien-luoc-marketing-cua- starbucks/#ftoc-heading-5
[6] Quyen Vu, October 16, 2021, Advertising Vietnam https://advertisingvietnam.com/3-chien-luoc-king-doanh-starbucks-va-cai- kho-o-thi-truong-viet-nam- p18088
[7] Cafeland, Starbucks officially announced their entry into Vietnam, January 13, 2013, https://cafeland.vn/doanh-nhan/doanh-nhan/starbucks- chinh-thuc-thong-bao-vao-viet-nam -4038.html
[8] SWOT analysis of Starbucks in business operations (October 2019), https://atpweb.vn/blog/phan-tich-mo-hinh-swot-cua-thuong-hieu- starbucks-trong-van -business-business/
[9] https://vietnamcoffee.vn/en/ca-phe/starbucks/bai-hoc-king-doanh-tu- thuong-hieu-ca-phe-starbucks-p2-91.html