(Tiểu luận) final marketing project instruction marketing principles analyzing a marketing stragety for starbucks

TON DUC THANG UNIVERSITY
FACULTY OF BUSINESS ADMINISTRATION
MAJOR: INTERNATIONAL BUSINESS

Final Marketing
Marketing Principles

Project Instruction

ANALYZING A MARKETING STRAGETY FOR
STARBUCKS
Lecturer: Thai Dam Huy Trung
Team 05 – Shift 01:

Ho Chi Minh City, May 16th 2022

PREFACE
In the first place, in order to carry out and successfully complete the subject of
Marketing Principles and the final report "Analyzing a Marketing strategy for
Starbucks", our team has received a lot of help and facilitated advantage from Ton
Duc Thang University. In particular, we would like to express our sincere thanks to Mr.
Thai Dam Huy Trung – our lecturer, who directly guided and accompanied our team
throughout the process of completing this course and this final report.
Our report is made based on the efforts of the team members (team 5) as well as
the references, lessons learned from books, research works, information from news
sites... In the process of implementation, although we have tried our best, but because
of limited knowledge and lack of practical experience, it is difficult to avoid
shortcomings. Therefore, we are looking forward to receiving your attention and
comments to improve this report.
Finally, we wish you all good health and good work.
We sincerely thank you!

Sign
Team 5

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THE LIST OF GROUP MEMBERS
No.

Full name

Student ID

Task allocation

Evaluation

● Chapter 5 (5.1, 5.2)
1

Nguyen Thuc Khanh

720I0517

● Chapter 7 (7.1, 7.2)

100%

● Synthesis the report
● Cover page
2

Do Ngoc Anh

720I0434

● Chapter 7 (7.3, 7.4)

100%

● Presenter
● Chapter 1
3

Tran Mai Han

720D0022

● Chapter 5 (5.3)

100%

● PowerPoint
● Chapter 2
4

Dinh Nguyen Gia Dinh

720I0490

100%
● Chapter 6 (6.1, 6.2)
● Chapter 3

5

Tran Tien Minh

720D0002

● Chapter 8 (8.1)

95%

● PowerPoint
● Chapter 5 (5.4)
6

Tran Thi Minh Tam

720K0592

● Chapter 8 (8.2)

95%

● Presenters
● Chapter 4
7

Le Hoang Minh Chau

720I0135

● Chapter 6 (6.3, 6.4)
● Presenters

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100%


TABLES OF CONTENTS

PREFACE

2

THE LIST OF GROUP MEMBERS

3

CHAPTER 1: EXECUTIVE SUMMARY

6

1.1. Main goals:

6

1.2. Recommendations:

6

CHAPTER 2: COMPANY DESCRIPTION

7

2.1. Brief description of the company’s background and industry

7

2.2. Brief description of your focal Product(s)/Service(s)

7

CHAPTER 3: BUSINESS MISSION

8

CHAPTER 4: MARKETING OBJECTIVE

8

CHAPTER 5: SITUATION ANALYSIS

9

5.1. Market analysis

9

5.2. Industry analysis

9

5.3. SWOT analysis

10

5.3.1. Advantages analysis

10

5.3.2. Disadvantage analysis

10

5.3.3. Opportunity analysis

11

5.3.4. Threat analysis

11

5.4. Competition analysis

11

CHAPTER 6: BUSINESS PROPOSITION

12

6.1. Mission Statement

12

6.2. Segmentation

12

6.3. Target market

12

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6.3.1. Senior citizens

13

6.3.2. Millennials

13

6.3.3. Adolescents and children

13

6.4. Positioning

13

CHAPTER 7: MARKETING MIX

13

7.1. Product

13

7.2. Price

14

7.3. Place

14

7.4. Promotion

15

7.4.1 The types of Starbucks sales promotion

15

7.4.2 How has Starbucks implemented promotional mixes?

15

CHAPTER 8: EVALUATION

16

8.1 The forecasted results (e.g., sales volume, market share, revenues over the
years...) of the marketing plan

16

8.2 The measurement to evaluate the achievement of goal

16

REFERENCES

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CHAPTER 1: EXECUTIVE SUMMARY
The complicated issue of the COVID-19 pandemic in Vietnam, as well as the
enforcement of anti-epidemic measures, has had a significant impact on Starbucks'
business operations. However, Starbucks is still able to keep its workforce, expand the
area of sales, and recover from the epidemic thanks to rapid adaptation and strategic
modifications by the combination of selling offline and online.
From the information that we collected about Starbucks, our group decided to
research and analyze a marketing plan to set goals and suggestions to help Starbucks
improve the quality of customer service in the best way.
1.1. Main goals:
- Giving suggestions and recommendations to help Starbucks improve the quality
and attract more customers.
- Analyzing the 4P strategy and SWOT model to support Starbucks in
determining pricing, product, promotional, and placement marketing choices for

Starbucks goods to satisfy particular customer needs.
From the goals we aim to achieve, we realize that Starbucks needs a strong
innovation attitude and aptitude to supply the proper items and align its brand in order
to thrive in its international development and growth strategy. Starbucks must maintain
consistent service and product quality, satisfy customers with flavors, and diversify
types and products to serve customers. Customers will remember and want to come
back to enjoy the atmosphere, the taste of coffee and connect with people.
1.2. Recommendations:
- Send a letter to the owner requesting that the rent of the premises be reduced.
- Increasing the number of branches in other provinces
- Create some promotions to attract more customers.

CHAPTER 2: COMPANY DESCRIPTION
2.1. Brief description of the company’s background and industry
Starbucks is a globally recognized coffee company. This company was founded
on March 30, 1971, at 2000 Western Avenue in Seattle (Washington). Jerry Baldwin,
an English teacher, Zev Siegl, a history teacher, and Gordon Bowker, a writer, were the
initial three creators of Starbucks coffee. When the firm first entered the Vietnamese
market, it created a frenzy by introducing a new and American-style coffee flavor.

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Initially, the brand was intended to be called "Cargo House," according to cofounder Gordon Bowker. Then it was suggested by a partner named Terry Heckler, that
a name starting with "St" would help make the agency more impressive. After
discussing, they built a brand with the name Starbucks from the novel Moby-Dick. The

name symbolizes the romance of the waves and the seafaring tradition of the world's
first coffee merchants.
After nearly 50 years of establishment and branding, Starbucks has changed the
logo image many times; each time the Starbucks logo changes, it has different message
meanings. However, it was until 2011 that the Starbucks logo was changed to fit that
period and is still in use today. This Starbucks logo no longer has details such as the
circle and the Starbucks Coffee brand name. But the core, basic image of the Starbucks
logo is still kept, so this logo still creates a familiar identity of the company. The color
of the Starbucks logo is more minimalistic when only keeping the primary blue and
white tones. The two-color techniques combined in the Starbucks logo carry the
message of cleanliness and deliciousness and attract customers. It can be said that the
overall Starbucks logo is minimalistic, neater, and more attractive. If anyone has never
known the old Starbucks logos, they cannot recognize this new change.
2.2. Brief description of your focal Product(s)/Service(s)
Some of Starbucks' main products can be mentioned as: The coffee, Tea,
Frappuccino, Smoothie, Other food and drink, Commodities (cups, instant coffee, etc.)
In addition to products sold year-round, Starbucks constantly refreshes its
products and product lines with seasonal products, limited edition products and
products for the holiday season,... Besides diversified products, Starbucks also always
focuses on improving the quality of its products and services. Starbucks always wants
to bring aromatic coffee cups, cakes, and teas with unique flavors and the professional
service style of the staff. Starbucks has always created new products to meet client
demands. In addition to coffee with a strong flavor, other products such as fruit tea,
seasonal products, and limited products... are constantly changing to suit the taste of
each season.

CHAPTER 3: BUSINESS MISSION
When building its brand, Starbucks made clear its mission to initiate and stay true
to its core values and those core values that arise from relationships with people. That
means Starbucks not only has a variety of coffee with reasonable prices but also has a

cultural space. To gain this mission, Starbucks creates its own style with a professional
service team, providing the best service to customers. Today, when going to any
Starbucks coffee shop, customers can not only drink coffee but also read newspapers
and work. All of those things of Starbucks are developed and follow the set mission.
That was also the vision of Starbucks when it was founded.
Starbucks makes environmental mission statements. For example, developing
innovative and flexible solutions for change, striving to buy, sell and use
environmentally friendly products, and making environmental responsibility a
company value. Starbucks made a commitment to a resource-positive future in 2020,
committing to halving its carbon, water, and waste footprints. As a step toward those
objectives, the company pledges to produce Carbon Neutral Green Coffee by 2030 and

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to reduce water usage in green coffee manufacturing by 50% (stories.starbucks.com,
2022).

CHAPTER 4: MARKETING OBJECTIVE
Starbucks Coffee, a well-known and expected top brand worldwide, is brought
into the Vietnamese market and established as a profitable brand. Starbucks Coffee
attempts to respond and adapt to changes in consumption and demand in diverse
markets in general, and Vietnam in particular, by maintaining brand identity through
traditional products. To adjust to the too busy life to enjoy traditional coffee cups,
Starbucks' marketing objective is to add a new style of Vietnamese coffee drinking
culture, through which they can enjoy coffee cups conveniently brewed in paper cups

with a wide variety of flavor options.
To achieve the above marketing objectives, Starbucks has set some short-term
goals:
● Sales goal: In 2022, Starbucks attempt to make up for the loss caused by the
Covid-19 pandemic through their sales revenue.
● Marketing goal: Starbucks' marketing goal in 2022 is to create information
flows throughout social networks to attract customers. Through a marketing
plan, they want to win market share from competitors such as Highlands, Trung
Nguyen, etc...
● Branch development goal: In 2022, Starbucks wants to open more branches and
stores in cities such as Nha Trang, Ha Noi, Da Nang, or Ho Chi Minh city.
● Product goal: Starbucks continues to improve product quality and develop more
drinks and confectionery products suitable for the Vietnam market this year.
They also want to change the products such as straws, spoons, and forks into
recycled materials.
● Service goal: Starbucks wants to enhance its service in 2022 by improving its
apps along with developing its delivery service due to the increased amount of
online orders since the Covid-19 pandemic.

CHAPTER 5: SITUATION ANALYSIS
5.1. Market analysis
Vietnam was attacked by a fourth wave of COVID-19 in the summer of 2021,
which has added to the pressures facing the coffee industry.
As a result, Starbucks recognizes the potential of online sales, so they are
working to improve the online sales channel to attract more customers.

5.2. Industry analysis
Coffee is the second most valuable traded commodity on the planet, making it
become an essential part of our global economy.
As worldwide consumption climbs, there is a growing need for coffee, however,

global supply falls short of expected demand. Therefore, the coffee industry will

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confront difficulty in the future as worldwide supply fails to satisfy the rising global
demand for coffee.
5.3. SWOT analysis
5.3.1. Strength analysis
- Brand popularity
● For many years, the company has successfully built a brand image as a
luxury beverage company.
● Starbucks appears in more than 65 countries with more than 40,000
stores in the world. Starbucks has 77 stores in Vietnam.
- Solid financial performance over time
● Thanks to the success of branding, the interest of consumers helps
Starbucks' revenue has continuously increased. Even during the
pandemic, Starbucks still reached positive profit, although not as much
as in 2020 (Patricia Marques, 2022).
- Quality and diversification of products
● The variety of products, the quality, and the flavors they offer are what
make Starbucks famous.
- Experienced high-quality leadership and management
5.3.2. Weakness analysis
- The price is high
● In comparison, Starbucks has the highest prices compared to other coffee

shops in Viet Nam. Starbucks products cost 38% more than products
sold by competitors (chiasenow. vn)
- Products can be easily imitated
● Products can be easily imitated because Starbucks doesn't have the most
unique or distinctive product. A large number of coffee chains offer
similar types of products. For example, Coffee Latte, Capuchino,...
- Unhealthy products
● Many Starbucks drinks are high in calories and sugar, causing a risk of
harm if consumed regularly. For example, a Starbucks cinnamon roll
Frappuccino contains 510 calories and 85 grams of sugar,

5.3.3. Opportunity analysis: environment, cultural, price,..
-

Natural resources
● Vietnam is one of the most favorable coffee-growing lands. The cold,
rainy climate in some northern provinces is very suitable for growing
Starbucks' main coffee - Arabica coffee.

-

Place of attraction
● With the development of large commercial centers in Vietnam, it is not
difficult for Starbucks to find a location that attracts customers with a
decent average income. With the development of large commercial

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centers in Vietnam, it is not difficult for Starbucks to find a location that
attracts customers with a decent average income.
-

Expansion
● Vietnam is a large and culturally diverse country that opens the door to
new opportunities. The number of coffee drinkers and Western cultural
adopters represented by Starbucks is increasing in Vietnam.
● Vietnam is a coffee-growing country and has quite a large demand for
coffee, coffee shops are scattered in both cities and provinces.

5.3.4. Threat analysis
-

Global pandemic and recession
Competition from other coffee chains
● Many other coffee shop business models in Vietnam are built according
to the chain system and threaten Starbucks such as Highland, The Coffee
House,...
● Sidewalk cafes can offer lower prices and satisfy the majority of
customers, so they can attract customers with their new style of decor.

5.4. Competition analysis
The competitive issue now depends on the efficiency of Starbucks' brand
positioning strategy in helping the company establish a good position in the
Vietnamese market. For example:
Revenue

(vnexpress.net,
in 2019)

Popularity

Price

Products

Starbucks

~ 35,000 115,000
VND

●
●
●
●
●

783 billion VND
Coffee
Tea
Frappuccino
Ice Blend
Other food and
drinks
● Goods (cups,
instant coffee,
etc.)

>70 branches

Highlands

~ 19,000 75,000
VND

●
●
●
●
●

>400 branches

Coffee
2,199 billion
Ice Blend
VND
Fruit tea
Bread
Cakes
and
other drinks
● Goods (cups,
roasted coffee,
etc.)

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Table 1. Comparison table between Starbucks and Highlands in Vietnam

CHAPTER 6: BUSINESS PROPOSITION
6.1. Mission Statement
Starbucks' mission statement is “To inspire and nurture the human spirit – one
person, one cup, and one neighborhood at a time.” (Starbucks.vn). With the mission
statement, Starbucks has underlined the primary role of the business towards its
clients, as well as emphasizes the significance of its buyers towards the firm's future
growth.
Starbucks has set out principles to follow their mission statement, for example:
● Starbucks ensures the quality of each cup of coffee.
● Starbucks connects with, laughs with, and uplifts the lives of its
customers.
● Starbucks is committed to the role of environmental leadership.
(Starbucks.vn)
6.2. Segmentation
Starbucks separates the market into three main groups: geographic,
psychographic, and demographic segmentation.
In the geographic group, everyone has different tastes of food by region.
In the psychological group, lifestyle is the key point. For example, office workers
often drink coffee every morning, so Starbucks can provide them a free drink or bonus
service to attract them to be the regular customer. For those who want to be ecofriendly, Starbucks provides them with limited-edition tumblers.
In the demographic group, Starbucks can divide the customer by their age and
gender. Children and teenagers often tend to like sweet drinks, on the contrary, people

in adolescence and middle age will choose the bitter taste of coffee. Similarly, men
will often like coffee with a strong flavor than women.
6.3. Target market
Starbucks segments its target by demographics, psychographics, and geographies.
While it is possible to identify some segments in a potential market like Vietnam,
Starbucks still takes a focused targeted marketing approach. That means the company
emphasizes on a narrowly defined market segment for high-quality, high-priced luxury
coffee products and eye-catching packaging. Starbucks customers:
6.3.1. Adults: from 25 to 40 years old
Is the main target market of Starbucks (accounting for 49% of all Starbucks
businesses). They are usually people with relatively high income, professional career
and focus on social welfare. What attracts them is the space design, the modern design
is consistent in advertising as well as decoration. This target audience grows at 3% per
year.
6.3.2. Young people: 18 to 24 years old
Accounting for 40% of all Starbucks businesses. What attracts them: Starbucks is
positioned as a place where college students can study, chat with friends, meet people,

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check in,... Starbucks uses active social networks to build a youthful image dynamic,
direct impact on this target group. Young audience growth 4.6 percent per year.
6.3.3. Children and adolescents: from 13 to 17 years old
Children are often accompanied by their parents, teenagers while using Starbucks as
a place to hang out with friends or study. What attracts them: milky drinks or coffees

with sugar, caffeine, whipped cream topped coffee. In addition, Starbucks makes its
brand child-friendly, such as special sizes for children.
6.4. Positioning
Starbucks presents itself as a highly respected brand that offers premium products
with global standard flavors, helping to set it apart from competitors in Vietnam such
as Highlands Coffee, The Coffee Bean, Trung Nguyen Coffee, and others.

CHAPTER 7: MARKETING MIX
7.1. Product
An essential factor in the success of Starbuck is the products bearing the
Starbuck brand values. The brand constantly innovates and creates menus to serve
each customer's needs. In addition, Starbucks also learns about regions and countries
about the population preferences,... of local people to have a reasonable product launch
strategy.
In the process of researching and learning about customer needs, Starbucks has
drawn different criteria:
● Based on the type of coffee bean: roasted and ground coffee, whole bean coffee.
● Based on caffeine level: regular coffee contains caffeine and decaf coffee
● Based on roast level: light roast, medium roast, and deep roast.
● Based on taste: flavored coffee and unflavored coffee.
Realizing the potential of customers who do not like coffee, Starbucks has
developed other products from fruit and tea so that customers can enjoy the Starbucks
space. In addition, the brand is also very creative when developing products such as
glass cups, porcelain cups, and thermos bottles,... Not only that but these products are
also designed according to each season and event.
7.2. Price
This has a significant influence on the consumption decision of customers. In
Vietnam, it is easy to see that the price of a glass of water at Starbucks is 3 to 4 times
higher than that of another cafe brand. This can affects the competition for the brand.
However, the customer segment Starbucks is targeting is mid-range to high-end, so

this doesn't seem to have too much of an impact on revenue. In addition, the
ingredients, formula, quality, and brand reputation make this brand still popular with
many customers. Therefore, Starbucks is said to have a "reasonable" price compared to
the quality.
Starbuck also has many promotions for old customers and discounts for those
who bring bottles and glasses of the brand to buy water.

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7.3. Place
With Starbucks' place strategy in marketing, the company has a pretty clear
vision to build a direct and personalized relationship with customers. This vision led to
the company distributing its products at Starbucks coffee shops, online stores, the
Starbucks App, and retailers.
In the incipient period, Starbucks sold its products at Starbucks Coffee shops.
When the Internet grew, Starbucks offered products in Starbucks' Online stores.
Moreover, they also link with hotels, airports, and coffee shops for office workers.
This makes it easy and fast for Starbucks to expand its market and maximize sales
profits.
Currently, Starbucks is present in 11 stores in Viet Nam. Starbucks is located in
stores with luxurious designs and prime locations in Vietnam, specifically in
commercial centers.
In addition, the world's number 1 coffee brand Starbucks is very attentive to
connecting and taking care of its customers. The proof is that the company has offered
a lot of incentives on birthdays, customers have membership cards, in order to build

and connect loyal customers.
7.4. Promotion
7.4.1 The types of Starbucks sales promotion
In its promotion mix, Starbucks used some forms like advertising, offline, online,
social media, sales promotions, and word of mouth marketing.
7.4.2 How has Starbucks implemented promotional mixes?
If comparing the investment in public relations compared to other brands in the
F&B industry, Starbucks' willingness to spend is quite "modest". In 2007, when
McDonald's spent 727.7 million dollars on advertising and media activities, Starbucks
spent only 16.6 million dollars. With the remaining money, Starbucks uses to find and
buy prime locations for its outlet stores. Along with that, Starbucks also has many
other special promotional activities, such as printing its logo on personal items and
collaborating with brands and celebrities to launch other limited editions.
Starbucks knows the brand's position in the market, so this company also focuses
on traditional marketing channels by using Starbucks Gift Cards to attract a large
number of new customers.
Instead of Starbucks' "specific" marketing strategy of deliberately "writing the
wrong name", the world's No. 1 coffee brand has used sheets of paper to stick it on the
cup. When it is the customers who share their feelings about this change, the
effectiveness of the business strategy has spread to the whole world.
The word-of-mouth marketing channel is also used quite effectively by the
company, to improve brand awareness and brand loyalty. With over 27 million fans on
Facebook and over 2 million followers on Twitter, it's easy to see Starbucks' lightspeed expansion in the race against other players in the market. What makes Starbucks'
brand successful lies in its quickness to follow trends and creativity in launching
communication campaigns.

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CHAPTER 8: EVALUATION
8.1. The forecasted results of the marketing plan
According to algorithm-based forecasting service WalletInvestor, Starbucks is a
“good long-term investment”.
Starbucks increased sales growth and profit margins by offering meaningful
innovation to their customers while focusing on execution and operational
improvements.
After Japan, South Korea, and Thailand, Vietnam is among the top five Asian
countries in terms of per capita coffee consumption.
Viewed from different angles, Starbucks will continue strong profitable growth in
the Vietnam market.
8.2. The measurement to evaluate the achievement of the goal
Starbucks made the decision to invest in its employees and the communities in
which they operate. Customer comment cards are used by Starbucks to assess
employee performance.
The organization intends to achieve this goal by cultivating a culture that values
acceptance and encourages personal development. Personal growth develops via
difficulty, as indicated in the firm's ideals, and the organization grows as well. The
company's diversity and accessibility policies reflect this acceptance aim.
Furthermore, Starbucks also collects data to track improvements and successful
or problematic procedures.

REFERENCES
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/> /> /> /> /> /> /> />Coffee Market Size, Share, Growth, Report | 2022 - 27 (mordorintelligence.com)
Coffee, the World 2nd Largest Traded Commodity - Mt. Si Coffee Roasters
(mtsicoffeeroasters.com)
Coffee Report 2022 | Statista
/>%A5c%20ti%C3%AAu%20ch%C3%ADnh,v%C3%A0%20trang%20tr%C3%AD
%20c%E1%BB%A7a%20n%C3%B3.
/> /> /> />%87nh
/> /> />Starbucks stock forecast: Have Q1 results given the share price a kick? (capital.com)
Starbucks Beats Earnings And Revenue Estimates, Raises Forecast (yahoo.com)
Starbucks Measures Its Success In Employee Accomplishments (Not Lattes) | Inc.com
Corporate Social Responsibility: How Starbucks is Making an Impact — WhyWhisper
Collective

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