Marketing Report: Starbucks

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Table of Contents

Product Description
Justification of Product Choice
Justification of Market Choice
PESTLE Analysis
Recommendation for Expansion
Suggested Marketing Plan
Reference List

Product Description

Starbucks is one of the leading coffee companies in America. The company has more than 11,000 stores in more than 50 countries. The company’s flagship product is coffee. It sells a number of popular coffee flavors in markets across the world.

The company does not have a single store in Italy despite the fact that Starbucks is a leading coffee retailer in the world. This is paradoxical because the CEO of the company conceptualized the company’s business model while on a business trip in Italy in 1983. Italian coffee bars inspired him to develop a coffee chain in America.

Justification of Product Choice

Starbucks coffee products have a history of strong performance in the retail market. In addition, the company is known for its innovative marketing approach. Its coffee is famous in many international markets. While the company’s main product is coffee, it also sells other products that accompany coffee. The good reception of the company’s coffee in the international market demonstrates its potential in Italy. This means that the company can expect to succeed if it enters the Italian market.

Justification of Market Choice

The choice of the Italian market as the focus for this project comes from three issues. First, Starbucks has an emotional bond with the Italian market. Italian coffee bars inspired the company’s CEO to develop a similar business model in America. Intuitively, Starbucks needs to give something back to Italy for providing the inspiration for its existence. Secondly, Starbucks is very experienced in international trade.

This means that it has the experience needed to succeed in the Italian market. The third reason for Starbucks to enter the Italian market is that the country has a rich coffee culture. While there is stiff competition in the coffee market, Starbucks can cut a niche based on its coffee retail model.

PESTLE Analysis

Italy is a politically stable country with strong institutions. In addition, the country has good relations with the United States. Italy’s economy is in recession alongside other EU countries. Socially, coffee forms part of Italian culture. The main social barrier that Starbucks will face is a language barrier. It may limit deployment of key personnel. In addition, Italians may resist American approaches to coffee marketing.

Italy’s technological infrastructure can support Starbucks’ operations. Italy, being part of the EU, operates under European environmental laws. The legal environment in Italy is stable and compatible with American laws.

In summary, Starbucks should enter the Italian coffee market because of Italy’s relative stability in the political, legal, and social spheres. Italy’s rich coffee culture is also a good reason for entering this market.

Recommendation for Expansion

Starbucks should expand into Italy to increase its international presence. However, this move will attract stiff competition from Italian coffee retailers. This means that the company needs to identify a market entry strategy that will reduce the impact of local competition. A successful entry into the Italian market will add value to the Starbucks brand.

Suggested Marketing Plan

The table of contents for the proposed marketing plan that should guide Starbucks’ entry into the Italian market is given below.

Industry overview
PESTLE analysis
SWOT analysis
Market segmentation
Identification of the target market
Pricing strategy
Branding strategy
HR strategy
Market entry strategy
Financial analysis

Reference List

Dalic, T 2007, Globalisation of Marketing Strategies in Light of Segmentation and Cultural Diversity, GRIN Verlag, Norderstedt.

Daughtry, TC & Casselman, GL 2009, Executing Strategy: From Boardroom to Frontline, Capital Books, Herndon, VI.

Denegri-Knott, J, Zwick, D & Schroeder, JE 2006, ‘Mapping Consumer Power: An Integrative Framework for Marketing and Consumer Research’, European Journal of Marketing, vol 9, no. 10, pp. 950-971.

Faulkner, D & Segan-Horn, S 2004, ‘The Economics of International Comparative Advantage in the Modern World’, European Business Journal, vol 4, no. 1, pp. 20-31.

Holt, DB 2002, ‘Why Do Brands Cause Trouble? A Dialectical Theory of Consumer Culture and Branding’, Journal of Consumer Research, vol 29, no. 1, pp. 70-90.

Pratali, P 2003, ‘Strategic Management of Technological Innovations in the Small to Medium Enterprise’, European Journal of Innovation Management, vol 6, no. 1, pp. 18-31.

Walker, DM, Walker, TD & Schmitz, JT 2003, Doing Business Internationally: The Guide to Cross-Cultural Success, McGraw-Hill Professional, New York, NY

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