SITI AISHAH MAMAT@MOHAMAD
PUTRI ARIESYA IXORA BINTI AHMAD TAMIMI
FACULTY OF BUSINESS AND MANAGEMENT
BACHELOR IN OFFICE SYSTEM MANAGEMENT (HONS) BA232
ASM401
FUNDAMENTAL OF BUSINESS
PAIRING ASSIGNMENT
MARKETING MIX ELEMENTS: STARBUCKS COFFE
PREPARED FOR:
MADAM HAZLIN BINTI HASAN
PREPARED BY:
SITI AISHAH BINTI MAMAT@MOHAMAD (2023125641)
PUTRI ARIESYA IXORA BINTI AHMAD TAMIMI (2023168707)
SITI AISHAH MAMAT@MOHAMAD
PUTRI ARIESYA IXORA BINTI AHMAD TAMIMI
INTRODUCTION
The assignment's purpose is to explore the various elements of Starbucks' marketing
mix. Jerry Baldwin, Gordon Bowker, and Zev Siegl created Starbucks Coffee in 1971 on the
cobblestone sidewalks of Seattle's famed Pike Place Market. In this area, Starbucks opened
its first store, offering freshly roasted coffee beans, tea, and spices from across the world for
our customers to take home. The company's name was inspired by the classic narrative
"Moby-Dick," which depicts the early coffee traders' naval experience. Starbucks Company's
mission is "to inspire and nurture the human spirit - one person, one cup, and one
neighbourhood at a time." The vision is to "establish Starbucks as the premier purveyor of the
world's finest coffee while maintaining our uncompromising principles as we grow."
MARKETING MIX ELEMENTS
PRODUCT
Starbucks Corporation is a masterpiece of a coffee retailer. It roasts, markets, and
distributes specialty coffee. Starbucks offers a variety of coffee blends, merchandise,
handcrafted beverages, and foods. It is also well known for offering a highly customizable
custom experience. They are offering a variety of exceptional products that customers can
enjoy whether in-store, at home, or anywhere else. Along with high-quality coffee, the
company provides an experience in their stores that justifies the extra cost. This "coffee
experience" features free Wi-Fi, quick service, friendly baristas, and comfortable seating in
cosy environments. Besides the benefit of being part of the Starbucks workforce, partners are
eligible to receive a free pound of coffee or box of tea every week. Starbucks utilises a matrix
organisational structure, which is a hybrid of various features from the basic types of
organisational structures and also combines several product-based divisions and functionals.
Customer experience and quality are part of the brand strategy that has been built.
Subsequently, the existence of specific chain brands such as Starbucks coffee shops is widely
perceived to be indicative of a "good" or "gentrifying" neighbourhood (Carapetian, 2017).
PRICE
One of the primary issues at Starbucks is the price. The pricing strategy used by
companies is the most important to attract and persuade customers to purchase any
beverages at Starbucks. In Malaysia, a localised pricing option is used. This is due to the fact
that international customers will believe in the high value of the products offered in contrast to
the American market, but they will pay much less for the same quality. This shows that our
country's currency is extremely depreciated nowadays compared to other countries. Pricing
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PUTRI ARIESYA IXORA BINTI AHMAD TAMIMI
information shows that one benefit of joining the Starbucks Rewards programme is the special
discount provided by Starbucks. Moreover, Starbucks partners may receive a 30% discount
on beverages, merchandise, and food in Starbucks retail stores. Starbucks will also increase
the price of its Grande and Venti coffees by just a small amount. Customers tend to pay more
for grande or venti-size coffees because the price of medium coffee is already high enough
(Chenghao Li, 2023). Besides, market segmentation for Starbucks is generally divided into
four variables, which are demographic, geographic, psychographic, and behavioural. These
variables will serve as the basis for identifying a company’s target market.
PLACE
The placement strategy is important in ensuring the company growth. Starbucks
Corporation has an outstanding placement strategy, and as a result, it has become one of the
world's most successful companies. Starbucks Corporation has expanded its product
environmental impact to 80 countries with an investment of 35,711 Starbucks outlets, almost
15,444 of which are based in the United States (Bhasin, 2023). Starbucks may be purchased
in a variety of ways in Malaysia. Customers have the option of purchasing it at a physical store
or online. Starbucks has around 320 locations in 14 states, including The Starbucks Reserve,
Starbucks Signing Store, and Drive-Thru Starbucks. Starbucks' goods are also widely
distributed by placing them in supermarkets and convenience stores. 7-Eleven, Aeon, Jaya
Grocer, and Lotus are a few examples. Customers may also order food and beverages via
online websites or applications such as GrabFood, Foodpanda, Shopee, and the Starbucks
Coffee app. Starbucks distributes its goods through four channels: company-operated sales,
authorised outlets, CPG and foodservice enterprises (Reis, 2017).
PROMOTION
Starbucks has a powerful promotion strategy, which allows the business to grow
rapidly. The concept of marketing advertisement excites customers whenever there is a new
promotion or deal. Not only does the promotion and advertisement of food and drinks have a
significant influence on the company's financial revenue, but so does the goods. Starbucks'
advertising approach relies on developing product-specific marketing campaigns and fresh
memes that resonate with people. The promotion strategy consists of a combination of search
engine optimization, digital marketing, social media marketing, conventional marketing, and
public relations. For instance, Starbucks Malaysia collaborated with an autistic artist to create
a portrait of the Health Director-General Datuk Seri Dr. Noor Hisham for ‘Coffee Chat’ and
presents. This public engagement between a barista and the customer is supposed to include
learning about the origin of the coffee (Nazari, 2020).
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SITI AISHAH MAMAT@MOHAMAD
PUTRI ARIESYA IXORA BINTI AHMAD TAMIMI
CONCLUSIONS AND RECOMMENDATIONS
The quality of the products offered by Starbucks must be improved. This is due to the
things provided being of poor quality for the amount charged. Based on our experience, we
purchased a plastic tumbler for RM52.00 and realised after a few uses that it was not durable
and the drink melted quickly. Starbucks must improve the quality of their products so that
customers aren't lured to buy tumblers from other places that are still worthwhile. Starbucks
tumblers are worth the hype, but they are not cheap.
Following that, Starbucks' price section needs to use psychological pricing. To
demonstrate to customers how much money they are saving, they should place the discounted
price next to the original price. This is also known as "anchored pricing." The psychological
pricing technique works well for businesses targeting price-sensitive customers since it
presents a perceived deal that clients who like luxury may not want. Aside from that, this
campaign indirectly draws in a lot of customers because it is affordable for those who do not
lead luxurious lives and who earn an average salary.
Aside from that, Starbucks may innovate to expand its business. Coffee has several
skin advantages due to its high antioxidant content, which can aid in fighting against free
radicals (Cherney, 2018). Cellulite reduction, relaxing effects, acne therapy, and vitamin B for
skin cancer are just a few of the advantages. Because coffee is an essential ingredient,
Starbucks may develop a spa and cafe concept where customers can have a treatment while
relaxing in the cafe. Customers may respond positively to this strategy because of the unique
idea of providing skin treatments using coffee to people of various ages.
Besides that, in order to attract a greater number of customers, Starbucks must
improve and change the schedule of their monthly promotion. For example, in May 2023,
Starbucks will offer customers RM30.00 for any two Venti-sized handcrafted beverages. The
issue is that the promotion is only available from 6:00 p.m. until 8:00 p.m. Because of peak
hours, many individuals miss out on this discount, particularly those who are on their way
home and are stuck in traffic. Starbucks may have morning, noon, and evening sessions three
times a day in order to increase customer interaction.
To summarize, Starbucks is an example of a company that has built its marketing
strategy on its customers and ethical behaviour, rather than spending millions on advertising
that has no societal influence. Marketing strategy selection is critical and plays a significant
influence in determining how far a firm will expand. Starbucks should advertise their Starbucks
card and manufacture the coupon to maintain and recruit more loyal consumers.
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PUTRI ARIESYA IXORA BINTI AHMAD TAMIMI
REFERENCES
Bhasin, H. (2023, February 23). Starbucks Marketing Mix. Retrieved from Marketing91:
[Link]
Reis, C. (2017). “A Venti company, please!” How Starbucks is continuing its success story.
NOVA School of Business & Economics, 1-30.
Nazari, T. (2020, July 9). M’sian Artist With Autism Who Drew Dr Noor Hisham On A Cup
Gets Special Invite From Starbucks. Retrieved from The Rakyat Post (TRP):
[Link]
noor-hisham-on-a-cup-gets-special-invite-from-starbucks/
Cherney, K. (2018, August 7). Does Coffee Have Any Benefits for Your Skin? Retrieved from
healthline: [Link]
Herman Donner, T. H. (2019). Does the Starbucks effect exist? Searching for a relationship
between Starbucks and adjacent rents. Property Management, 562-578.
Li, C. (2022). Comparison of the Market for Starbucks and Luckin—How Did Luckin Rise. C.
F. Peng et al. (Eds.), 109-115.
Document Information
Analyzed document AISHAH&ARIESYA_PAIR ASSIGNMENT_ASM401.pdf (D170028979)
Submitted 2023-06-08 [Link]
Submitted by SITI AISHAH BINTI MAMAT@MOHAMAD
Submitter email 2023125641@[Link]
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