StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...
Free

Social Responsibility and Brand Strength of Starbucks - Case Study Example

Cite this document
Summary
The paper "Social Responsibility and Brand Strength of Starbucks" discusses that maintaining ethical standards for the company can lead to its success rather than concentrating just on profitability. In the recent past, Starbucks has undertaken to launch more products in the market…
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER94.1% of users find it useful

Extract of sample "Social Responsibility and Brand Strength of Starbucks"

Starbuck’s Report Student’s Name Institutional Affiliation Case Summary The report is about Starbuck a company in coffee industry whose mission is social responsibility and brand strengthening. The company deals with an array of products with coffee being one of its key products. The sale of its products is usually via retail outlets and its trademarks are licensed through various channels with some being under its partners. For example, its Frappuccino coffee drinks, VIA coffee, Starbucks Double shot espresso drinks and super premium ice creams can be bought from the company’s grocery stores via retailers such as Target and Walmart. Starbuck is considering collaborating with Courtesy products to produce a single-cup packet Starbucks packet for sale to hotel rooms. The company boosts for its powerful corporate culture and has been ranked as one of Fortune’s “100 Best Companies to Work for” for almost a decade. In the year 2010, Starbucks was voted as “Most Ethical Company” in the entire European Coffee Industry (Fraedrich, Linda & Ferrell, 2013). Ethical Issues Through its CEO Howard Schultz, the company recognizes that, although it may be cumbersome to be in the right all the times, it is important for a company to sacrifice some of its short-term commitments that to disregard its central values in the long term. Therefore, the company views its employees as its indispensable part. Employees who work at Starbuck for not less than 20 hours in a week are guaranteed of an inclusive benefit package that comprises of stock options, medical benefits, vision as well as dental benefits (Fraedrich, Linda & Ferrell, 2013). Its ethical practices also extend to other countries and the company has gained recognition and won awards for its corporate culture. Starbuck has also collaborated with other companies to contribute money towards research for HIV/AIDs. The company also collaborated with conservation international for environmental conservation, which should be the center of focus for business today in upholding of ethical standards. This was accomplished through supporting sustainable agriculture where farmers were encouraged to adopt a shade- grown coffee practice to prevent deforestation by cutting down trees to create coffee plantations. Starbuck’s Primary Stakeholders Starbuck Company was formed by three partners who included Jerry Baldwin, Ziev Siegel and Gordon Bowker) on March 30 1971 in Seattle. In 1982, Howard Schulz moved in as marketing director and retail operations. Later he became the CEO and the chairperson of Starbuck. Howard Schulz works in collaboration with a team of executives to come up with principles and strategies that the company should adapt to maintain its status in the global market. Other stakeholders includes partners such as Courtesy products and Green Mountain Coffee Roasters who collaborates with Starbuck to bring Starbucks- branded coffee as well as tea pods in the market. Its suppliers also form a part of its stakeholders and Starbuck is committed to improving corporate social responsibility with coffee growers. In addition, customers forms part of its stakeholders and the company is committed strengthening its brand and meet its customer needs, tastes and preferences (Fraedrich, Linda & Ferrell, 2013). Alternatives One of the alternatives of Starbuck is to modify its brand to meet sophisticated customer needs, tastes and preferences. This alternative need to be considered by any established company regardless of how successful it might be and it should learn to acclimatize their products as well as the image of the company to respond to the changing demands of the targeted markets. Starbuck should also follow suit and incorporate product branding as one of its alternatives. Although the company has managed to penetrate the coffee industry and remain competitive, it needs to develop its brand to meet increasing consumer demand for quality coffee as competition in specialty coffee drinks continue to augment (Fraedrich, Linda & Ferrell, 2013). Intensification of its brand and meeting the customer needs can one of the best strategies that the company should adapt to remain competitive in global market. Another alternative for the company is to apply advanced technology in coffee brewing, product diversification and enhancing their advertising campaigns. Through technology, the company will be able to produce in large scale thereby taking advantage of economies of scale. On the other hand, its products will become more affordable to budget- conscious customers. Starbuck has been anticipating venturing into music, movies as well as other ventures that would diversify its markets but it has not been able to accomplish that since it concentrated more on the quality of coffee, the condition of its coffee shops and strategies to remain competitive in coffee industry rather than product diversification (Fraedrich, Linda & Ferrell, 2013). Ethical Issues Arising From These Alternatives In an effort to adapt various alternative measures to strengthen its brand, respond to consumer needs and to move with current technological advancements ethical issues such as environmental conservation concerns may arise. Starbucks has adapted a move to manufacture cups that are more environmental friendly. One of the strategies adopted by the company is to change from using polyethylene No. 1 to more environmental friendly polypropylene No. 5. However, the company is faced with challenges in disposing these cups as they are non-biodegradable and characterize a somber waste problem for the company (Fraedrich, Linda & Ferrell, 2013). Starbuck is now considering a strategy to encourage consumers to bring back re-usables to the company with a promise for compensation to coffee consumers. However, this has not been accomplished as the number of re-used cups brought back in the company is below its expectations. They are devoted to solving the problem come to 2015b where it expects the return of re-usables to be 100%. Constraints Some of the constraints facing the company is penetration into the UK market. Realizing that the uniformity its stores could not be match the UK market, Starbuck considered restructuring its stores so that it could serve its customers better in all spheres of its operation. Starbuck is also looking forward to enhance its market in China and expand its operations. However, in the Chinese market, the company has 7000 stores and it is intending to open a hundred more stores. Nonetheless, the company is faced with constraints on how it will approach and penetrate the Chinese market by identifying strategies that would serve the needs, tastes and preference of Chinese customers. Thus, there is need for Starbuck to invest more into branding its products and enhancing its current technology in coffee brewing as it retains its corporate responsibility. Despite all these shortcomings, the company is determined to capture a larger market share in China as compared to other competing companies in the coffee industry (Fraedrich, Linda & Ferrell, 2013). Recommendations Despite the company’s effort to uphold sustainability and preserve high standards of ethics, the company has received criticisms in the recent past on issues related to fair trade and driving locally coffee shops out of the market. However, in bid react to those criticisms the CEO of the company Mr. Howard Shultz should consider providing Fair Trade Certified Coffee, that has being described as menu that will enhance its operations in all its markets (Fraedrich, Linda & Ferrell, 2013). Starbuck has current implemented Fair Trade Certified Coffee in both the UK and the Ireland although it has not been able to implement the same in the United States. The company should also seek to strength its brand, meet the over-increasing customer demands and concentrated more on creating consumer loyalty rather than opening more stores. This strategy will make Starbuck more competitive in the United States as well in the global market. The company should invest most of its resources in advertising and creating awareness of its different brands to increase its market share and remain competitive. The company should also focus on harmonizing prices of coffee and other products in order to meet the needs of budget conscious customers who may not afford to buy expensive products from their stores. Answers to the questions at the end of the case study (4a). Why do you think Starbucks has been so concerned with social responsibility in its overall corporate strategy? Starbucks is much engrossed in social responsibility since it views its workers as it indispensable part hence has to help them achieve better living standards for healthy business growth. In addition, the top management (Howard Schultz), strives to be sympathetic to eliminate dogma created by unsympathetic employer since he also grew up close to his father and his life was nearly destroyed by his father indifferent to employers. Therefore, he aims at building a company that his father never worked for, fully caring for all its employees' needs. Thus said Starbucks spends more in insurance and rates highly in provision of social responsibility services (Fraedrich, Linda & Ferrell, 2013). (4b). Is Starbucks unique in being able to provide a high level of benefits to its employees Starbucks uniqueness is portrayed in provision of better and quality social services, and the greatest spender in providing high-level benefits to its employee leading to high productivity and low employee turnover. In addition, Starbuck, just like other modern day firms, is concerned with meeting its suppliers’ needs to increase its productivity, a major revolutionary in modern business operation. Starbucks has attained amazing growth levels due to the quality services offered to its employees (Fraedrich, Linda & Ferrell, 2013). In addition, Starbucks has built its reputation on quality products, an approach adopted by other companies, ensuring stakeholders’ financial success. (4c). Do you think that Starbucks has grown rapidly because of its ethical and socially responsible activities or because it provides products and an environment that customers want? Albeit being one of the largest coffee brands in the entire world, Starbucks still maintains good relation with its employees through provision of non-remuneration packages such as medical insurance and dental care services to its employees. These business ethics has endeared the company to its employees thereby increased productivity and high employee retention rate leading to low employee turnover. This reduces the costs associated with hiring and training new workforce. Conversely, Starbucks maintains a cordial relation with small-scale farmers through socially responsible Starbucks Coffee and Farmers Equity Practices (C.A.F.E.), which ensures profitability of farmer through farmer premium prices (Fraedrich, Linda & Ferrell, 2013). These social responsibilities to farmers have made Starbucks the preferential coffee buyer in many countries thereby increased raw material provision. Lessons from the Case From the case study I’ve learnt that maintaining ethical standards for the company can lead to its success rather than concentrating just on profitability. In the recent past, Starbucks has undertaken to launch more products in the market to remain competitive. The company has set a good example with the way it relates with its employee, suppliers, customers and the community. As aforementioned, Starbucks is so much concerned with social responsibility as an overall corporate strategy. Starbucks employees work for not less than twenty hours a week and are guaranteed inclusive benefit option that includes stock options, medical benefits, and dental benefits among other social services. The company also supports sustainable Agriculture by encouraging farmers by giving fair prices for their products and encouraging them to adopt best farming practices. From the above, it is evident that Starbucks has considerably grown due to its ethical and social responsibilities, which have endeared it to both its employees and suppliers hence, Starbucks rapid growth. However, part of its success can be attributed to provision of products needed by consumers. References Fraedrich, J. Linda, F., & O.C. Ferrell (2013) .Ethical Decision Making in Business: A Managerial Approach, (9th Ed). Stamford: Cengage Learning. Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(Case 2: Starbucks Mission: Social Responsibility And Brand Strength Study Example | Topics and Well Written Essays - 1500 words, n.d.)
Case 2: Starbucks Mission: Social Responsibility And Brand Strength Study Example | Topics and Well Written Essays - 1500 words. https://studentshare.org/business/2050977-case-2-starbucks-mission-social-responsibility-and-brand-strength-page67
(Case 2: Starbucks Mission: Social Responsibility And Brand Strength Study Example | Topics and Well Written Essays - 1500 Words)
Case 2: Starbucks Mission: Social Responsibility And Brand Strength Study Example | Topics and Well Written Essays - 1500 Words. https://studentshare.org/business/2050977-case-2-starbucks-mission-social-responsibility-and-brand-strength-page67.
“Case 2: Starbucks Mission: Social Responsibility And Brand Strength Study Example | Topics and Well Written Essays - 1500 Words”. https://studentshare.org/business/2050977-case-2-starbucks-mission-social-responsibility-and-brand-strength-page67.
  • Cited: 0 times

CHECK THESE SAMPLES OF Social Responsibility and Brand Strength of Starbucks

Starbucks Coffee Company

The main goal of starbucks is to provide the finest coffee globally in addition to a pleasant environment where the customers can enjoy the coffee.... To understand the nature of coffee retail industry and the performance of starbucks, the threats and opportunities of starbucks were assessed (Khattab, Aziz and Naguib 1-5).... starbucks Coffee Company is a leading coffee retailer that deals with roasting and retailing of coffee beans, selling brewed coffee, coffee related equipment's, Italian-style espresso beverages, other cold beverages and some food items....
6 Pages (1500 words) Essay

Starbucks: Generic Strategies

Starbucks always ensure that Furthermore Starbucks does not follow traditional aggressive advertising strategy; rather it focuses on high-level branding and marketing practices (Larson, Marketing Strategy and Alliances Analysis of starbucks Corporation).... starbucks has been adopting ‘differentiation' strategy.... starbucks does not market its brand as a low-cost service provider.... Rather the starbucks brand is presented as such a company that provide premium quality coffee at a premium price....
4 Pages (1000 words) Essay

Strategic Management - Analysis of Starbucks External Environment

The essay "Strategic Management - Analysis of starbucks' External Environment" will offer a detailed evaluation and analysis of starbucks' external markets in Europe.... The economic recession and other economic factors have over the years brought about a severe impact on the operation of starbucks Company.... The essay will as well analyze the starbucks strategic capability as well as the company's strategic fit analysis.... starbucks was introduced in 1971 in the Pikes Peak market in settle, Washington....
12 Pages (3000 words) Essay

Strategic Management and Competitive Advantage in Starbucks

crutiny at a SWOT analysis of starbucks reveals its strengths, weaknesses, opportunities, and threats.... This case study "Strategic Management and Competitive Advantage" describes the recent campaign to expose tax havens has claimed yet another victim, this time around being the starbucks Cooperation.... In January this year, starbucks has been the epicenter of public backlash after it was revealed that they had been falling short of their tax mandate for the last three years....
7 Pages (1750 words) Case Study

Trouble Brews at Starbucks

The paper "Trouble Brews at starbucks Company " will begin with the statement that Starbuck Company began in 1971 and was based in Seattle in Washington.... In 1982, it had expanded into five stores that sold coffee beans, wholesale businesses that targeted local restraints, and roasting facilities (starbucks Corporation n.... This was done for the purpose of restoring Starbuck's premier brand....
5 Pages (1250 words) Case Study

Starbucks Market and Customer Analysis

About 40 percent of starbucks' total sales is accounted for young adults between the age of 18 and 24 and this market will be a key target in the venture.... The research paper "Starbucks Market and Customer Analysis" presents the strengths and weaknesses of starbucks's products and services as it ventures into the new target market.... And one of starbucks' key weaknesses is the fact that most of its products are generally perceived to be quite expensive....
4 Pages (1000 words) Research Paper

Strategic Analysis of Starbucks

This paper 'Starbucks: Strategic Analysis' is focused on the strategic analysis of starbucks.... The researcher analyzes the resources and competencies of starbucks along with its strategic positioning.... By 1987, the total number of starbucks outlet was 17, which increased to 55 by 1989 and 84 in the next year.... The primary data has been gathered through a face to face interview with a floor manager of a starbucks store.... The first starbucks store was established in the 1971 in Seattle by three friends Jerry Baldwin, Gordon Bowker and Zev Siegl....
18 Pages (4500 words) Case Study

Starbucks Organizational Culture

This paper "starbucks – Organizational Culture" focuses on the fact that as a face to face fast-moving organization, starbucks lays a large amount of importance on the skill, capability and motivation of its staff.... Every starbucks outlet works independently and manages its human resources.... A middle-sized starbucks outlet employees over 35 staff members who contribute to the effective running of the organization.... The international range of products offered by starbucks is starbucks Frappucino, starbucks Discoveries, starbucks Double Shot Espresso, starbucks Iced Coffee, starbucks Coffee Liqueurs and a line of super-premium ice creams....
9 Pages (2250 words) Case Study
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us