Business and Starbucks Marketing Analysis †MyAssignmenthelp.com

Question: Discuss about the Business and Starbucks Marketing Analysis. Answer: Introduction The main purpose of this report is to conduct a marketing research and marketing opportunity that will help assess the future demand and potential of medium roast level coffee in Australia. For most people, a good morning begins with a good cup of coffee. It does not matter the type or blend- just good coffee. Also, coffee is incorporated into different daily rituals. This drink is enjoyable and enticing at the same time seductive. Most brands offering coffee just do it for the sake of making profits. Clearly, it seems that no one understands what consumers are looking for when making purchases. Many say that taste and trends changes with time and that in the contemporary world, selling coffee is not just about taste, but also comfort, class, and culture. Aside from these factors, there are also other emotional and psychological reasons that make coffee loved. What attracts Australians to coffee is its novelty. A decade ago, not so many cafes served espresso (based coffee like Lattes or Cappuccinos). It is only after big companies like Starbucks started serving espresso that other cafes started doing so. Consequently, such type of coffee blend came to be common in most stores in Australia. The medium roast level is identical to the Full City+. Looking at the beans used to make this roast, one can notice large chips missing. This is an indication that the coffee was roasted perfectly during g the second crack stage (Nichols, 2011). Also, the beans look oily and because of this, the oil will become stale and rancid faster (SBUX, 2011). This roast level is gotten in between the normal roast and French roast, also known as espresso, that leads to more of the oils coming out of the coffee bean and caramelizing hence giving a slightly bitter taste. (AMP, 2013). Other blends of coffee served in Australia, including the dark roast level which uses extremely dark beans with burnt oils coat. It is thought to be strongest in terms of flavor. Many people also describe it as being flatter compared to the blonde or medium roast (Wilson, 2014). The dark roast level is said to be preferred by Americans. The latter believe that this roast level of coffee is the cool and correct way to drink coffee (SBUX, 2011). Nonetheless, preference is determined purely by a persons taste buds. And judging by the Australian culture of taking coffee, it would only be far to introduce a blend that is roasted perfectly. Many people, especially those not accustomed to purchasing coffee from big restaurants, wonder if the coffee there is of superior quality and how the companies make it addictive. Contrary to the common belief that it is of high quality, the answers to these two questions are related to emotional and psychological factors in a buyer (Corones, 2014). Experts explain that people make purchases emotionally then justify them rationally (Gruyter, 2015). This answers the question of quality. It turns out that coffee served in international restaurants, like Starbucks, is not any way of a higher quality. In fact, many people do not see quality as really important when buying coffee. From the research on the culture of coffee in Australia, it was established that there are three main factors that make the coffee experience at soothing to the soul. The actual buying experience is motivating and ensures that the customer always comes back for more (Hair, 2013). This explains why, in Starbucks stores, there is a good atmosphere, soft background music, nice aromas and warm baristas (Panmore, 2015). The experience is made better by the different names given to the drinks. For example, a simple black coffee is named Pike Place blend venti (Panmore, 2015). The unique names, coffee ordering processes, and rites make the customers interested in the coffee and comfortable being part of that experience. Meaning, if this product is to make an impact on the market, there should be innovations in customer experience factors to attract buyers. The second factor that makes the coffee experience unique in Australia is a personal reward. Psychologists state that Starbucks continues to prosper because of the personal feeling to reward self (Gruyter, 2015). Before one embarks on work, it is important to grab a cup of coffee to motivate self. Also, after a tiring day, it is only fair to relax with another cup of coffee (Panmore, 2015). This trend ensures that customers are always seeking the services of cafes. Behavioral psychologists also say that our brains convince us into feeling good about something when we believe they are better (Panmore, 2015). Therefore, even if the coffee medium roasted coffee is of an average quality, we still believe that it is of high quality because of the brand, experience and the belief that it is the best. Familiarity also makes coffee preferred. It is mainly achieved through effective branding and positioning. There are so many coffee brands in the world, even within the local areas we reside in. It is impossible to decide on one, especially when in a hurry. For example, because McDonald's is known all over hence going to a new city is less frightening because one knows that McDonalds meals are good (AMP, 2013). Meaning, medium roasted level can perform better if introduced to big brands with large customer reach and already installed customer loyalty. Marketing Research Techniques As a company, it is important to do a PESTEL analysis so as to understand the environment you are operating in well enough. PESTEL analysis normally gives one an overview of the whole situation a business is in. In short, it is the birds eye view of the stimulus and the scenarios that cover the business. PESTEL denotes the factors that affect the marker in various ways and change the strategies made. In this section, the report provides a PESTEL analysis for medium roast level coffee in Australia. The main political factor facing the introduction of medium roast level coffee is sourcing of raw materials. This has sparked a heated debate, especially among politicians in the country and from the source countries. Therefore, the company has to abide by the sourcing strategies through upholding the Fairtrade policies and practices (Magrach, 2015). Similarly, regional integration is a trend that presents an opportunity for the market of medium roast level coffee to grow through ensuring that the consumer can afford the product (Winograd, 2013). The product is expected to perform well because of the high growth rate of Australia and declining employment rates. Other economic factors affecting the companys operations are the taxation levels and the economic environment in a particular country. One of the socio-cultural factors that could affect the performance of the introduction of medium roast level coffee is globalization. This has been increased by the internet and the media leading to the spread of western cultures in other countries (SBUX, 2011). Therefore, it might only auger well with people who subscribe to European culture (Wong, 2016). Other social-cultural factors are the increasing health concerns related to caffeine and sugar levels change, and the patterns of family and work leading to a change in consumer values and preferences. The product is at an advantaged position in enjoying the mobile wave. Through partnering with the Apple Company, the company has managed to bring app based discount coupons .This will help drive the mobile wave smoothly (Nichols, 2011). Also, through the introduction of Wi-Fi capabilities and mobile payments in stores, payment could be made easy. These factors add value to the general customer experience. To continue holding the consumers trust, the company should prioritize business practices activists and international advocacy. Under this category, medium roast level coffee has the opportunity of business sustainability trend, growing popular support for responsible sourcing of coffee and the increasing need for environmentally friendly products (Magrach, 2015). Legal factors In providing the medium roast level coffee must address product safety regulations in its macro-environment. It should satisfy the product safety regulations and regulations on ingredients from genetically modified organisms (GMO) (Winograd, 2013) The PESTEL analysis above shows that most of the external factors in the coffees macro-environment present opportunities to the company. However, it should be noted that the threats presented are serious and should be addressed so as to promote the company long-term prospects. In this section, the report provides a SWOT analysis based on the medium roast level market research. It indicates that there is a gap in the coffee market in Australia. People need coffee made to fit their culture. The SWOT analysis is summarized in the following table. Internal Strengths Weaknesses The company has created a strong market position and global recognition Selling high-quality coffee that cannot be found anywhere else Aesthetic appeal of the stores makes their customers feel comfortable and at home Ability to incorporate technology and mobile services in the business has made it stand out from others in the industry Relatively expensive Dependent on conditions in source countries Dependent on coffee culture thus it may not be accepted in foreign countries External Opportunities Threats Room for expansion in the emerging market It can be sold through retail operations Technological advances for the company. Through working with Square, a mobile payments app that is integrated with its the companys app. Economic uncertainty Entry of competitors with cheaper prices Changing consumer tastes and lifestyle choices Volatility in the global coffee market Market Summary and Demand assessment The coffee industry continues to expand in spite of the increase in costs. For example, in January 2009, the price of coffee was 108.39 U.S. cents per lb, by December 2010; the price had increased to 184.26 U.S. cents per lb (Gruyter, 2015). Also, in the last two years, there has been a 200% increase in the price of coffee (Gruyter, 2015). This increase has occurred not only in terms of prices but also the supply chain and the high cost of living experienced all over the world today. Therefore, the introduction of medium roast level coffee adds to the already available coffee blends in Australia. This is justified by the increase in demand for coffee with a different taste. Also, the country has become home to many foreigners. Having multiple blends will give them a choice range depending on individual culture and preference (Magrach, 2015). Further, not many restaurants sell medium roast level coffee. Most prefer dark and blonde roast level coffee. Meaning, the product will enjoy less competition. The following is a description of the marketing mix, 4Ps, to be utilized in making people aware of medium roast level coffee: Product: Medium roast level coffee is made from beans that look oily and because of this, the oil becomes stale and rancid faster. This roast level is gotten in between the normal roast and French roast, also known as espresso, that leads to more of the oils coming out of the coffee bean and caramelizing hence giving a slightly bitter taste. Price: Medium roast level coffee will be slightly more expensive than the ordinary. This is because it takes longer to prepare and needs more ingredients. Therefore, it is expected that it will buy at $205. 24 cents per lb. Place: Being an island continent surrounded by the Southern, Pacific and the Indian Ocean, Australia receives many visitors for both business and tourism. Therefore, medium roast level coffee has a large group of potential customers. Promotion: To create awareness on this product, promotion strategies like TV ads, social media marketing and establishing partnerships with big companies can be helpful. Although expensive, they are effective in inducing purchase. Conclusion The following provided results of a marketing research on medium roast level coffee. Most Australians are accustomed to blonde and dark roast level coffee. On the other hand, medium roast level coffee is common among foreigners living in the country. This provided an opportunity to ensure that consumers get to have a wide range of blends to choose from. From the study, it was clear that coffee consumers in Australia prefer a particular blend because of its taste, his/her culture and the buying experience. Similarly, this study provided two marketing research techniques: SWOT and PESTEL analysis. These helped in forecasting the performance of medium roast level coffee in Australia. Thus, the study concluded that medium roast level coffee has a huge potential in the Australian coffee market. References AMP. (2013). Supply Chain Management. Wall Street journal , 172-195. Corones, S. (2014). The Competition law in Australia. Thomson Reuters Australia. Crawford, H. J., Gregory, G. D. (2015). Humorous advertising that travels: A review and call for research. Journal of Business Research, 569-577. Gruyter, D. (2015). Starbucks Marketing Analysis. Journal of Case Research in Business and Economics, 220-253. Hair, J. (2013). Essentials of business research. ME Sharpe. Magrach, A. (2015). Climate and Pest-Driven Geographic Shifts in Global Coffee. Plosone Journals, 7-25. Murphy, P. (2011, January 26). Brazil could be world No. 1 coffee drinker by 2012. Retrieved December 21, 2016, from Business Financial News, Breaking US International News | Reuters.com : https://www.com Nichols, M. (2011, March 10). Reuters.com. Retrieved December 15, 2016, from China and Russia drive growth in world's billionaires.: https://www.reuters.com Panmore. (2015). Starbucks Coffee SWOT Analysis. Panmore Institute, 25-52. SBUX. (2011, January 30). Starbucks Corporation Stocks. Retrieved December 20, 2016, from Yahoo!Finance: https://www.finance.yahoo.com Touboulic, A. (2016). Sustainable purchasing and supply. Journal of Marketing Channels, 85-87. Truong, V. (2015). Social marketing quarterly. Elsevier, 230-248. Warren-Myers, G. (2016). Sustainability evolution in the Australian property market: Examining valuers comprehension, knowledge and value. Journal of property investment and finance, 578-601. Wilson, J. (2014). Essentials of business research: A guide to doing your research project. Sage. Winograd, D. (2013, August 23). Skip Starbucks. Retrieved 12 January, 2017, from Huffington Post: https://www.huffigtonpost.com Wong, P. (2016). The drivers of overseas investment in the Australian residentisl property market. RMIT University.