Starbucks: Delivering Customer Service

Essay by florinmuraruUniversity, Master'sA, December 2006

download word file, 7 pages 4.5


The company started its activity in 1971 as small coffee shop located in Seattle specialized in selling whole arabica coffee beans. After being taken over by Howard Schultz in 1982, following a rapid and impressive growth, by mid 2002 the company was the dominant specialty-coffee brand in North America, running about 4,500 stores, 400 international stores and 930 licenses.

In 2002, unexpected findings of a market research showed problems regarding customer satisfaction and brand meaning for Starbucks customers. The situation was unacceptable for a company whose overall objective is to build the most recognised and respected brand in the world. Starbucks was supposed to represent a new and different place where any man would relax and enjoy quality time, alone or with others. But the market research showed that in the mind of the consumers, Starbucks brand is viewed as corporative, trying to expand endlessly and looking to make lots of money.

This huge gap between customers' perception and Starbucks' values and goals called for immediate action.

Christine Day's interpretation of the market research made her think that by shortening the service time for each customer to maximum 3 minutes, all the problems would be solved. However, this solution came with the price of $40 million per year, due to a significant increase in the labour. The proposed solution would most certainly lead to the result desired by Day, but would it be enough to restore Starbucks' damaged brand image? Are 20 seconds of customer service really time worth $40 million per year? This is the question we are trying to answer in this case, while seeking alternative purposes for this expenditure, in order to achieve higher benefits.

How did they get there?

Great quality products, customised, served in clean, convenient placed stores for everyday coffee, friendly and fast...