How does Starbucks strive to get the 'BUCKS'?

The Starbucks marketing strategy is not one commonly seen in many businesses today.

Have you ever realized that it’s rare for you to find a Starbucks ad on a billboard, ad space, newspaper or poster in places where you can expect to see advertisements for most other establishments, even huge ones like McDonalds?

Here are some strategies which they use worldwide.

• “Perfect Cup of Coffee” – Starbucks history has shown that they place a huge emphasis on product quality. Their coffee is known for satisfying customers with its rich, delicious taste and aroma.
• “Third Place” – The Starbucks marketing strategy has focused on creating the “third place” for everyone to go to between home and work. Creating this unique and relaxing “experience” and “atmosphere” for people has been very important for the company as they have realized that this is one of the strongest concepts attached to the company, to which customers have been strongly attracted
• “Customer Satisfaction” – Customer satisfaction is a very important issue with Starbucks. From entrance to the store to the very last drop of their coffees, it is a must that customers feel the uniqueness of enjoying their Starbucks coffee experience.
• “Creating a Starbucks Community” – The Starbucks marketing strategy has even expanded to create a community around their brand. On their website, individuals are encouraged to express their experiences with Starbucks history, and the company strives to “personally” join in the discussions.
• “Smart Partnerships” – Starbucks Coffee Company has been known to create strategic partnerships that demonstrate the fact that another way to grow your business is to partner smart. Over the years, the Starbucks Corporation has greatly increased sales just by using this strategy. 
• “Innovation” – Through the years, the Starbucks Coffee Company has been known to think up creative and innovative ideas to add to their products or services. They’ve added different flavors to their coffee, more food on their menu, and even became one of the firsts to offer internet capability in their stores
• “Brand Marketing” – The Starbucks marketing strategy has always focused on “word-of-mouth” advertising and letting the high quality of their products and services speak for themselves. For years, this has been uniquely Starbucks, and it has played a huge part in making Starbucks Coffee Company a success. India is quickly warming to the coffee house culture, and the entry of the biggest name in the business is stirring up the market. As Seattle-based Starbucks Coffee contemplates its strategy, its biggest rivals, Cafe Coffee Day and Barista Lavazza, are making inroads in small cities and towns .

Starbucks has  made a revenue of more than Rs. 14.6 crores in India. HOW?

In the coffee house business, a larger footprint means more revenues. Starbucks, in a 50:50 joint venture with Tata Global Beverages, called Tata Starbucks Ltd, plans 50 outlets by the year-end - a drop in the ocean for the 17,000-store global chain. When the venture was announced, R.K. Krishna Kumar, Vice Chairman, Tata Global Beverages, said the group may target 3,000 outlets in India in a few years. The Tata Group, of course, is no newcomer to the business, having been a Barista partner earlier. In a market pegged at nearly Rs 1,440 crore and expected to grow at a compound annual rate of 30 per cent over five years, rivals are unfazed, as the Indian market is underpenetrated.

so how did they do this?

• Joint venture: starbucks entered india with the most powerful strategy they could. having joint venture with one of the biggest  firms in india helped starbucks to know what indians really needed. they were able to know the taste and preferences of the consumers they were targeting. 
• Pricing: The most important factor. As a former CEO of a coffee chain put it, “The deal with the Tata’s is a masterstroke. It allows them to source coffee from India, roasted to their specifications.” But more importantly it allows Starbucks to avoid the 100 percent duty that Coffee Bean, Gloria Jeans Coffee and Costa have to pay. Coffee costs account for 40-45 percent of costs at these chains and what Starbucks has done with the Tata tie-up is that it has reduced its coffee costs to around the same as what say Café Coffee Day would pay. This should give it the pricing heft required for a market likeIndia. People in the trade whom Forbes India spoke with said they expected a basic Starbucks coffee to cost an average of Rs125 – higher than the Rs60-75 that Café Coffee Day charges but lower than the Rs150 other international chains inIndiacharge.

In addition to coffee they expect food to be another key driver of footfalls. In India food usually makes up for 25 percent of revenue something Schultz knows only too well. “Just like we have done in China, we will create local relevancy, especially on the food side,” he said in an interview last year.

Given that a coffee shop generates returns of Rs200-250 per square foot — about a fourth  what the typical restaurant does– getting a local food offering that drives footfalls will be key. (Per square foot returns are not an indicator of profitability as the footfalls in a coffee shop are higher). Here again the tie up with the Tata’s comes in. TajSATS, which is well versed with Indian food habits will be roped in to supply food to Starbucks outlets

• Menu: Starbucks has through its research and affluences found out what the consumers in india would prefer. for example: the burgers or the sandwiches you can see in india you would never find it in any corner of the world.
• Brand Positioning: Last year howard schultz (chairman and CEO of starbucks) in an interview with Forbes India had made it clear that the last thing they would do is water down the experience. “I think it would be very disappointing for us to come all the way from Seattle to India and water down the experience because we don’t have the courage to create something that is consistent with our heritage.”  So expect the company to go aggressively after real estate in Delhi and Mumbai. Malls, airports, office blocks are prime targets. There should even be a couple of trophy outlets like the one they have at the entrance to the Forbidden City in Beijing. A Starbucks at the Gateway of India perhaps
• Facilities: Indians love anything that comes for free. Isn't it? and if it's wifi then that place surely becomes our second home. Starbucks gives free wifi to attract consumers.