University of California
Type of paper: Thesis/Dissertation Chapter
Starbucks Corporation and Brand Loyalty
In today’s highly competitive business markets, a consumer’s loyalty to a brand often adds reassurance to the company’s stable and lasting position in the marketing world. As the new year continues to unravel, brands must maintain strong marketing strategies in order to keep their current buyers interested as well as capture the eye of new buyers. Brand loyalty after all, is the consumer’s conscious and unconscious decision, expressed through intention or behavior, to repurchase products from a brand continually.
It occurs when the consumer perceives that the brand offers the right product features, image, or level of quality at the right price. One of the industry’s most successful companies, with over 19,000 stores worldwide, is Starbucks Corporation. Through the use of various marketing tactics, Starbucks has established itself as the largest coffeehouse company in world with a continuously expanding flock of loyal consumers each year. Pricing: As the leader of the coffee market, Starbucks Corporation is known for setting its prices on a simple idea: providing high value products at a moderate cost.
When consumers are drawn to a product they find worthy of their money, they often are willing to pay any cost to attain the item. For Starbucks’ loyal consumers, quality is key. To maintain its brand loyal consumer base, Starbucks ensures their buyers quality coffee to justify its costs. Differentiation: Starbucks spends a large sum of time and energy annually to differentiate itself from its competitors. When one steps foot into one of the coffeehouses’ many locations, he or she will immediately be exposed to the music played in the shop as well as the types of products the shop sells, from bags of freshly ground coffee to jazz CDs.
Starbucks also tries to stay up-to-date on the latest technology, often times being the first to introduce the newest advancements to its customers. Through new approaches such as location-based promotions and mobile payments, Starbucks uses various techniques to set itself apart from other coffeehouses in the hopes of attracting brand loyal consumers. Customer Service/Satisfaction: Starbucks has always been strongly devoted to providing its customers with quality service. To ensure this goal is achieved, the company aims to hire motivated and committed employees.
Each individual hired by the brand is employee trained for all classes of employees, including part-time workers. Starbucks relies on its baristas and other frontline staff to provide customers with the best “Starbucks Experience”. My Starbucks Rewards Card: Another tactic Starbucks has used to reel in brand loyal consumers is the introduction of the “My Starbucks Rewards Card” in 2009. The free, no-contract rewards system allows customers to accumulate stars for each purchase they make at a Starbucks shop. Each star collected is put towards the three level reward system, qualifying card owners for free drinks on birthdays and other benefits.
Similar to a reloadable gift card, card users can check there can easily assess and manage their card balances online. The My Starbucks Rewards Card is the perfect way to attract and keep brand loyal Starbucks consumers since customers have the incentive of earning rewards for simply buying products from their favorite coffeehouse. Starbucks’ Social Media Strategy: In addition to operating fan accounts on Twitter, Facebook, and YouTube, Starbucks also owns its own version of a social networking site called, MyStarbucksIdea. com, where customers are asked to contribute their ideas on anything related to Starbucks.
The site allows to users to see what others are suggesting, vote on ideas and check the results. MyStarbucksIdea. com is a brilliant and important aspect of Starbucks social media strategy. Users who are part of this network feel that they have some role in the decision making process of the company and it makes them feel a part of it. Starbucks employees also play role in the company’s social media strategy by participating in the blog entitled, “Ideas In Action”.
This blog is written by various Starbucks employees and discusses how the brand is incorporating the ideas submitted by users on MyStarbucksIdea. com. The blog keeps customers in the company loop by keeping them informed regarding what is happening with their ideas. This strategy helps to increase the loyalty of consumers to the brand as well as showing potential customers, “Hey, we care about what YOU have to say”. Free Samples: On Tuesday, January 12, 2012, Starbucks Coffee released a new roast of its famous coffee, the “Blonde Roast”. To help introduce customers to its new lighter roast product, the company offered free samples of its brews during a 3-hour event each day, for two days.
The research from tasting event called the, “Find the Roast You Love Most”, showed that more than 54 million U. S. coffee drinker said they prefer the lighter-roast coffee. Customers who came for the sampling were also given free samples of the light roast to brew at home and a $1 off coupon off a pound of any Starbucks coffee. By offered free samples of their new product to the public, Starbucks was able to draw forth brand loyal consumers as well as other coffee lovers. Today, Starbucks Corporation is one of the most successful and admired companies in the world.
Since the company opened its first coffee shop in Seattle, Washington in 1971, it has expanded into a billon-dollar international brand. From its tasty beverages and treats to its specialty, whole-bean coffee blends, Starbucks has developed strong strategic methods that have led the coffeehouse to success, winning over the hearts of many coffee indulgers. Through strategies of pricing, differentiation, providing quality customer service, introducing a rewards program, social media networking, and free samples, Starbucks has been able to acquire thousands of brand loyal consumers each year.