The underlying marketing problem that Starbucks has lies in its failure to see that its marketing strategies do not necessarily meet its marketing objectives. It wanted to expand but failed to see that it has not necessarily been meeting the market. Market profile was shifting to characteristics that the brand was not originally marketed for. A high-end priced product in a seemingly expensive place did not match the market that was becoming lower economic bracket, less educated, and younger.

That is why the new market base does not frequent Starbucks stores because the brand seems to be anachronistic to their character. The whole packaging of Starbucks was targeted towards a high-end market. It would naturally see a lower growth rate amidst a market base that is shifting to low-end. Younger and less educated people will not sit it out on a lounge chair to sip coffee, read, or talk about issues.

The growth strategy was not really the failing point. In fact, this augured well for the company’s bottom line. What the company’s executives failed to see was the fact that if it wanted to saturate the market, its product and service offerings were not really meeting the characteristics of the market. That is why the market perceived Starbucks as merely concerned with growth in the number of stores and profits. The wide potential market base did not see Starbucks as concerned with their needs.

The issue of customer satisfaction being rather low is really not Starbucks’ main problem. Speed of service is not really the panacea to its main handicap. If retail is all about customer relationship at the point of sale, Starbucks is not even bringing in its potential retail market. The retail business of Starbucks is simply not attracting the market to the point of sale.

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Via Reuters/pseudorandom