Starbucks Product Strategy

Product Strategy

Over the years, Starbucks has employed different but effective strategies to establish itself as a leader in the coffee industry. It has done a number of things to differentiate itself from its competitors. It has also introduced products and services focused towards certain types of customers. Innovation has been very important in helping Starbucks differentiate itself from its competitors.

According to Michael Porter’s Generic Competitive strategies, Starbucks has employed a strong focused differentiation strategy. The generic strategy of differentiation involves the creation of something that is perceived by the industry as being unique. This can take on many different forms including but not limited to brand image, technology, features, dealer networks and customer service. And focused differentiation strategy concentrates on a narrow buyer segment and offers niche members customized attributes that meet their tastes and requirements differentiates from competition in specific areas. In the case of Starbucks, the company is a high cost, specialized selection provider, offering specially tailored lines of coffee and tea product to coffee loving customers for a premium price. And also the company’s target consumers were wealthy, educated, coffee drinker who preferred quality and customer service over a discounted price. Starbucks aims at a very narrow and specific portion of the consumers in the coffee industry. Thus, the company’s strategy is focused on this segment and its products and services are especially designed to meet this particular consumer segment’s needs or wants.

In terms of focused differentiation strategy, the Starbucks brand is presented with distinctive characteristics. Its coffees are mixed with other materials, whilst maintaining the credibility of the taste of the Arabica beans. The company uses Italian words in naming its products, which although difficult to pronounce appeared to be

...