StarbucksPromotion

Types & Application on the global stage

Starbucks

21/11/2011

Members Contents ReferencesQ&A

Li Ivy Maximilian

Phong Nguyen

An Le Kito

Contents

Theory overview Promotion – types & underlying concepts

Standardization vs. Adaptation

The Promotion of Starbucks

Advertising & Direct Marketing Visual application

Conclusion

IntroductionPromotionThe propose of promotion is to

make consumers aware of a

new product, to stimulate

nonusers to samples, an existing product, or to

increase overall consumer demand.

1 Advertising 2 Direct marketing 3 Personal selling 4 Public relationship

Promotion – underlying concepts

Teutner (2002): “instruments to stimulate

sales of products and brands”

3 Basic objectives (Kurtz, 2010): Information Change behaviour to

increase Demand(short term)

Differentiate from Competition

ACT NOW!

Features Action-orientated

marketing events

(Rossiter and Bellman, 2005)

Tool: stimuli to cause sudden behavioural change;

may also appeal to Product, Place & Price

(Van Waterschoot & van den Bulte, 1992)

Types - The Promotional Mix (1) Advertising

(presentation by identified sponsor: e.g. Print, TV, direct mail, web)

Personal Selling

(person-2-person transaction)

Sales Promotion

(paid consumer communication programme)

Types - The Promotional Mix (2)

Public Relations & Publicity

(evaluating & influencing the public perception) Direct Marketing

(communication with prospect i.e. generate response in form of request or order) Exhibitions or try-outs

Standardisation vs Adaptation

Adaptation: A strategy regarding change of the marketing program (e.g. Product, Price, Place, Distribution.) according to local preferences

Standardization: Usage of a generic marketing program for different international target markets.

Promotional Type “Advertising”– Application at Starbucks

Jonoshka (2004):‘external communication of an organization with actual and potential customers.’

Types of advertising media include: Print media : newspapers, magazine,

posters,... Broadcast media : TV, radio...

Direct marketing: direct mail, website, online advertising... (Kotler, 1994).

Starbucks costs on advertising*

2007 $ 103.5 million

$ 19.2 miilion

2008 $129.0 million

$8.8 million

2009 $126.3 million

$7.2 million

* Numbers provided are based on world wide costs starbucks.com

Store operating expenses,

other operating expenses and general and

administrative expensive ()

Prepaid expenses and other current capitalised advertising

costs

Word of mouth- “third place”1) The average Starbucks customer visits the store six

times per month while the heaviest 20% of customers go to Starbucks at least 16 times per month. (Starbucks commercial, 2010)

Social media2) Starbucks is mainly adult-focused and aims to

connect with their customers, communities, and children through various advertising tactics

(Professor Marty Lawlor, 2007)

- E-marketing

Twitter, Facebook, Youtube, My starbucks idea,

Starbucks V2V (Jon Swartz, 2009)

http://www.youtube.com/watch?v=K9nJa_8LnSI

- Iphone applications

(Annual report, 2009)

Starbucks card*

Starbucks Card is the simple, easy way to pay when you are in store.

Extra rewards for Starbucks card holders

* Starbuck.com

TV commercials

Starbucks is worlds one of the best brands but it rarely advertised on television (Burt, 2009).

In 2007 the company felt slowdown in customer traffic even in holiday season. For the first time Starbucks introduced the national TV advertisement in U.S (Janet, 2007)

The TV Commercial titled Starbucks Holiday 2010 was done by BBDO NEW YORK advertising agency Starbucks Coffee company (for Starbucks) in USA. released in November 2010.

Market segment Young, affluent customers College educated Higher income levels People combining work and coffee break People who have requirements for the Life-

styles

Visual Examples

Back

Conclusion

Promotion plays a vital role for Starbucks

Starbucks uses various advertising tactics

Starbucks concentrates on E-marketing

Q&A

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