Marketing Blend - Brand, positioning, and the four Ps

Brand and positioning

The Starbucks brand brings three basic values to consumers: great coffee, customer intimacy, and a unique atmosphere. Their coffee is brewed from the best quality beans, and if you’re not happy with it you can always change your cup. The staff tries to remember your name, and it’s written on your cup as well. As the coffee is sold at a premium price, the emotional experience the customer gets when journeying between the office and home is where the additional value comes from. Therefore, their brand is positioned to give more value to customers than competitors like Picnic and Robert’s Coffee at a premium price.

The four Ps

After examining the marketing approach Starbucks should take, let’s take a look at the proposed marketing mix for Starbucks. We’ve used the four Ps; price, product, promotion and place; to examine the different marketing aspects Starbucks needs to take into account.

Price

As our hypothesis states, and with the support of our field research, Starbuck’s has an ‘exotic’ aspect to it and people go there for more than just coffee. Therefore, their pricing strategy should be similar to the one they’ve had in Scandinavia and worldwide, a premium price for a premium specialty service. Instead of competing with the price, Starbucks will provide more value than competitors, which in turn explains the higher price. Nevertheless, Starbucks should monitor any changes in the perceived value of their products, since reoccurring Finnish consumers are still figuring out what they are willing to pay for such a specialty coffee. Their premium coffees have a great margin at the moment, partly thanks to their operations which are wired to the maximum.

Product

Starbuck’s main products are its specialty coffees. They fall into the category of mass-produced tangible products. Their life cycle is very short, and therefore marketing efforts and benchmarking should happened at a continual basis as is typical of adaptive marketing. For now, Starbuck’s product mix seems good as it is and there are no major changes required. Nevertheless, an ‘artic coffee’ to celebrate their entry to Finland would be a welcome addition to further increase awareness. Going to the first Starbucks in Finland, we noticed they wrote the names of customers on the cups. This is a nice addition  making the experience more personal, with no cup being exactly the same.

Promotion

The promotional marketing mix should be both traditional and adaptive, as explained in the  previous post. As over 90% of Finnish consumers are online, Starbucks should maintain a constant social media presence with regular Twitter updates and Facebook competitions. This will speak to the younger generation of potential customers such as Johanna from our customer analysis post.

The traditional marketing side could be done with promotional pop-up stands in various cities, even before entering those cities. This would give Starbucks more street-level visibility and give consumers a small taste of the new, emerging coffee culture Starbucks brings. In addition, valuable customer analysis can be done at the same time. Another simple marketing campaign giving high visibility is to utilize bus stop and metro station ads. Especially in Helsinki, a one-week takeover of the city’s bus stop advertisements would reach nearly a million people.

Place

Place refers to distribution, providing the product in a place which is convenient to access. We recommend an exclusive distribution strategy to be used. Starbucks coffee would be only sold in their stores and a few premium department/grocery stores. Nevertheless, the most popular and premium products should not be sold in grocery stores, only a few of the basic ones to get the brand name out. This way Starbucks will be able to uphold their premium image.


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