Starbucks: Delivering Customer Service

Essay by duce_isiUniversity, Master's July 2006

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Problem statement:

Recent market research has revealed that Starbucks is not meeting customer expectations in the area of customer satisfaction. Starbucks must come up with a plan to target specific areas of improvement identified in the research to improve sales while keeping the potential impact on bottom line to the minimal.

Situation analysis:

Key results that stood out from the recent market research conducted showed that Starbucks:

* Was perceived as a corporate giant primarily concerned with growth.

* Attracted a new breed of younger, less well-educated, lower income, less frequently visiting customers.

* Was not meeting customer expectations in terms of customer satisfaction.

Senior Management at Starbucks have the task of analyzing the results of the market research to understand the real reasons behind this fall in customer satisfaction levels and developing a plan to positively impact these statistics and ultimately increase sales and profitability.


The demographics of a typical customer at Starbucks have changed drastically from its early days.

Newer customers are younger, less well-educated, earned less, visited the coffeehouse less often and had very different perceptions of the Starbucks brand than those that were regulars who had been customers for a longer time. The historical customer profile of an affluent, white-collar female aged between 25 and 44 had expanded and reflected the market realities of a multicultural population. A typical customer visited Starbucks five times a month. While many factors influenced customer satisfaction, overall service and speed of service were identified as the most influential.


Starbucks was clearly ahead of its competitors in terms of size of operations and profitability. In the US, Starbucks competed against:

* Regional small-scale specialty coffee chains like Caribou Coffee

* Numerous independent specialty coffee shops

* Donut and bagel chains like Dunkin Donuts


Starbucks pursued...