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Competitive Strategy

Essay by   •  April 19, 2011  •  Case Study  •  429 Words (2 Pages)  •  1,519 Views

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4. Decision Criteria and Alternative Solutions

We can't deny that Starbucks always at the right temperature so that all the coffee drinkers can sip it right away which is convenient. As far is the price, they charge so much because of their high cost and quality of coffee beans. Their service in unique. But however, Starbucks shall take some business promotion idea into consideration as the income was decrease seriously year by year which is stated in the income statement of Starbucks.

First Alternative Solution.

Starbucks can have the promotion for customer on every 17th as the 1st store was founded in 17th July 1971 by Gordon Bowker, Jerry Baldwin , and Zev Siegl, who joined forces to open a coffee shop in Seattle, Washington. The promotion is 30% for the recent top or new 5 flavors of coffee. As what we know, Starbucks's coffee can be consider as luxury beverage and for the lower level of citizen, they may not affort to buy. With this promotion idea, every one can taste and enjoy with the high quality of coffee.

For this promotion, Starbucks can create a slogan as, " Drink the best, Pay the less."

Pros Cons

1. To remind everyone of the great achievement of 17th July 1971 ( the success of 1st store). To refresh the history of Starbucks. 1.If the company get in the habit of running sales promotions, customers will become aware of it. This could then have a negative impact on the sales anytime that when not running a promotion. The customers might start waiting until they see that Starbucks are having a sale to come in. If they know that they can get a better price at a different time, they might be inclined to hang onto their money.

2. Running a sales promotion in this way seem like a natural way to increase sales and improve the bottom line. 2. Starbucks rely on a reputation of quality in the industry to set themselves apart from others. Running sales could hurt this image. Customers will no longer associate the business with quality, but will instead associate it with bargains. This could negatively impact the ability to make bigger sales with higher margins at other times.

3. Customers will try on the new products which are having promotion instead of buying others which are having original price. And this will can be one of the promoting idea of new products.

4. Consumers like the idea of sales, and they believe that it is to their advantage to act quickly. The idea of the sale could influence the customer to make a purchase and can influence customer behavior indirectly.

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