Product details

This background note is to accompany the case ''508-025-1''. The abstract of the case is as follows: The case discusses how Starbucks has addressed the challenges of a maturing home market in America, by attempting to attract a new generation of consumers, while retaining the loyalty of the existing ones. This case specifically examines the core part of Starbucks, which is the gourmet coffee product, along with four key initiatives undertaken in terms of new products and services by Starbucks in recent years in America. These are: (1) food and more; (2) the Starbucks card; (3) the Starbucks express; and (4) high-speed wireless Internet. Some of these new initiatives have been successful in creating additional revenue and have clearly improved Starbucks'' brand image among the new generation of Americans, while some others clearly haven''t worked. This has ultimately resulted in Starbucks being a US$6 billion plus company by the end of 2005, with a presence in 34 countries through more than 10,000 stores. The case has a two-fold objective. Firstly, it seeks to help students understand how global brands such as Starbucks, continually add new products and services around the core product, which in this case is gourmet coffee, to keep the excitement alive around the brand, both in mature domestic markets as well as international markets. Secondly, it asks students to apply key theoretical concepts in marketing such as the differences between products and services, and levels of product and service value, to the Starbucks example, to analyse which of these new product and service initiatives will be successful in the long run, and add to the core Starbucks brand value of a gourmet coffee drinking experience. The case is meant for first or second year undergraduate students as part of the introduction to the marketing or even consumer behaviour curriculum. The case is accompanied by an additional theoretical reading note as well as a teaching note. The reading note discusses how a company today can create a service product, and add value to it, and provides additional support to help students answer the questions given at the end of the case. The teaching note includes several key aids for instructors such as the highlights of the case, the target audience, the suggested student assignment (for those instructors who may not want students to answer the specific questions given at the end of the case), suggested additional readings (provided with this case), suggested teaching approach, etc. However, the primary focus of the teaching note is to provide a proposed analysis of the case, which specifically answers the questions given at the end of the case.