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Communicating price increases effectively is crucial to a successful price hike, and managing customer perception is a key part of the Starbucks strategy. Figure 4.1: Marketing Mix Quantified of Starbucks in China (Author 2014). In this blog entry we explain in more detail Starbucks growth strategy in China. H1: There are changes with the international marketing strategies used by Starbuck Corporation internationally. Remarkably Starbucks plans to expand its coffee shops through its ambitious expansion to sustain marketability and market share by creating more jobs and increasing revenue. (2003), describes Starbucks entry into China has one influenced by increasing disposable income leading to viable competitive leads in the intermediate to prolonged term. As a remarkable company, Starbucks Coffee Company has grown into a global brand since its founding in 1970 in Seattle, the United States, concentrating on increasing customer satisfaction by treating each customer with respect and dignity. It is usually used to boost profits in areas where the customer is happy to pay more. To compare the marketing entry strategy that gives competitive advantage to Starbucks over its competitors in China and in the UK. More significantly, Starbucks depended on independently developing its own network, within the local market because of established similar operation to Starbucks while developing a strategic alliance with a local partner (Evans et al. Starbucks has come a long way since it established its first store in China in January 1999. More significantly, the marketing mix based on pricing, promotional, placement and product of the marketing environment ensures increased market accessibility as the products and services are sold to final consumer. More so, in-depth research on Starbucks expansion provides further analysis of the inductive approach based on use of secondary sources is relevant. Cooper and Schindler (2003), indicate that positivism research philosophy is suitable as it remains factual based on law about the relationships between different extremes. More significantly, it is through the establishment of marketing channel that the company seeks to make its products accessible and available to its consumers in the growing market. With the increased use of promotional strategy, Starbucks Corporation has created a brand image to differentiate itself from its competitors, through internet advertisement and coffee shop advertisement where it gains access to internet users as the increased technology makes it the best channel to introduce and increase sales levels of new and existing products and service. Even as, the management decided to maintain its standardised coffee blends as it faced competition from Costa coffee as it introduced other flavours than the Americanised coffee drinks (Witkowski 2005). Fax: +44 01937 842110, We’re proud to sponsor TABS Cricket Club, Harrogate Town AFC and the Wetherby Junior Cricket League as part of our commitment to invest in the local community, Company Reg no: 04489574 | VAT reg no 816865400, © Copyright 2018 |Privacy & cookies|Terms of use, Pricing Products: the iPhoneX "Higher or Lower" Activity, Marketing: Factors to Consider When Setting Prices (GCSE), Marketing: Introduction to Pricing (GCSE), Pricing Strategies and Tactics - Introduction, Pricing - factors to consider when setting price, Marketing Mix: Price (Revision Presentation). Considerably, the choice of market by Starbucks is based on the suitability of the location, which depends on the favourable nature of the business and strategic location for customers to access products and services. More so, Starbucks market strategies seek to attract an increased number of customers considering that it targets those from both the wealthy elite high class customers and middle class consumers. It also added that its Asia-Pacific profit margin was for 14 countries, not just China. 1, Issue 2, PP. This is because, the choice of the coffee outlet by the customers is based on the variety of coffee offered, the experience gained in the stores and the employees who give the customers exceptional services. More significantly, Starbucks penetration to Chinese market seeks to establish increased market presence through increased customer awareness as, the company carries out advertisement of its product in its diverse target market to increase its market presence. (2007) explains the necessity of using an effective method in research methodology as being critical in achieving reliable and authentic findings of the investigation. Notably, there is establishment of over 570 business stores, in different cities within China depict Starbucks use of most successful market access approaches it has ever applied. More so, the organization’s strategies have seen Starbucks Corporation expand to the Far East and United Kingdom being the key business driver as it established a foothold in China. More so, Starbucks management both in the UK and China mark seek to reduce cost and increase customer accessibility by exploring suitable market mix strategies applicable in different locations. Indeed, Starbucks remain as one of largest and most recognized coffee industry in the global scale because of its efficient expansion and management approach, specifically in their market mix to suit the locations. Considerably, the decision making process in use of marketing tools is influenced by prevailing market conditions, degree of competition, economic conditions, growth targets and interactions with its subsidiaries in order to meet customer demands. Howard Schultz, CEO of Starbucks, saw China as a primary growth market and had ambitious growth plans at a time when there was worldwide anxiety over the country’s sluggish economy and market turmoil. Starbucks pricing Strategy Linyan Wu. Without a doubt, the issue of cultural influences that affects all aspects of life ranging from social, political, and economic perspective in nature affect company global expansion. Figure 4.3: Marketing Mix Quantified of Starbucks in the UK (Author 2014). H1: There are expected changes with Starbucks competition in its expansion globally in China and UK. More so, Starbucks operates globally through it branches and store that are widely distributed using standardized prices while it offers services that suits its promise of providing high quality and increased value of its coffee products and service through suitable price strategy towards its goods. As a result, Starbucks Coffee globally has been able to competitively stay as a preferable brand in business catering specifically to middle-class to high class consumers in UK. Hire verified expert. The customers were willing to pay a higher price for the brand name. As differences in geographic location, culture, tradition and other factors affect market profitability, it is necessary to adjust and adapt diversified strategy in each country. Christmas 2020 last order dates and office arrangements Starbucks defended its pricing strategy in China, saying that its higher prices were attributable to its higher cost of doing business in the country than in other markets. Notably, use of qualitative secondary research study is more suitable over the collection of quantifiable data in this research as it uses quantitative comparative analysis of the research thus providing depth information (Saunders et al., 2007). To be successful in running an international business, there is need to focus on quality operations management through strategic critical decisions in the product and design decision. 2003). Starbucks created extensive consumer taste profile analyses that are sufficiently agile to enable them to change with the market and to create an attractive East meets West product mix. More remarkably, the chain of outlets seek to give its consumers increased service reliability, high product quality, and management of operations as it seeks to increase its business growth and sustainability. Add to that a sales tax of 17%. Premium Pricing involves setting the prices of products higher than comparable products. As a result, Starbucks focus has been moving from being a profit-making business as it engages in corporate social responsibility within China in corporation projects in the country and district parts. More than often, Starbucks Company’s pricing strategy is discretionary to suit individuals from both the low and high income earners. Saunders et al. (2007) explains the necessity of using an effective method in research methodology as being critical in achieving reliable and authentic findings of the investigation. The prices of imported goods in China are often raised because of the effects of import taxes (tariffs) - in this case the customs duty on roasted coffee beans is 15%. As a result, the entire research will focus on marketing strategies thus allowing for consequent conclusions based on the research questions. Kotler (2000) describes place as the final location of the goods to the end consumer. When Starbucks started in China, one of the biggest challenges it faced was to make the consumers accustomed to drinking and appreciating coffee. Increased success was achieved through company efforts to introduce coffee drinks faced stiff competition from tea consumption, which is an immediate substitute for coffee. Escalation of Trade Tensions Between China and US Could Significantly Boost China’s Retail Stocks ; Starbucks’ China growth story.

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