Starbucks & Global Strategic Management

Although many think that a firm's patents do well to prevent imitation, there was one instance in which the opposite was the case for Starbucks. Source: KTLA In 2014, a popular TV show titled "Nathan for You" experimented with the imitation laws surrounding one of the world's most recognizable companies. Parody imitations are a loophole, so he created "dumb Starbucks" as a way to show an ailing coffee company how they could boost their sales. Because every single item in store, on the menu, and surrounding thebuilding had the word "dumb" before it, it was considered a parody. It didn't take long after opening for Nathan to attract attention from all over the world. Starbucks quickly shut the entire project down, but it was a prime example of how simple it was for one man to open a store that completely imitated what Starbucks was doing. And if the coffee was just as good, why would anyone choose to go to Starbucks? At least they were ge...

Starbucks first entered the China market in 1999, where many people assumed it would fail on the presumption that Chinese people drank tea and tea only. What was seen by many as a "first mover disadvantage" was actually the exact opposite. Starbucks saw the opportunity in the newly emerging middle class, and acted on it. They didn't attack the tea drinkers by trying to impose coffee upon them, but rather added specialty tea drinks to their menus and focused on brand awareness, not coffee consumption marketing. This coupled with the newly emerging middle class allowed Starbucks to capitalize on the rapidly changing conditions of the Chinese markets. Source: Quartz Starbucks' Chinese markets have seen tremendous success over the years. In March of 2017, Starbucks announced it had opened more than 2,600 in China since its first opening in 1999. In other words, 10% of the companies stores now operate in China. Had they not capitalized on this global opportunity, t...

I believe there is a significant factor missing from Porter’s five forces, and that the threat of becoming obsolete could be added as a sixth force. Some may say this would fall in to the category of substitute products, but I think there are significant differences. I can think of two industries off of the top of my head that could be used as examples: energy and technology. As technology becomes more advanced, old technologies are thrown out and discontinued. For example, a floppy disk manufacturer would become obsolete if they did not shift what they manufactured once CDs became the storage of choice. Consequently, even if they were to shift to CDs, once cloud technology became the norm, how would they transition into offering that kind of storage opportunity? In energy, the classic “are we going to keep using oil” debate is what comes to mind. Coal, however, is an example of an energy form that is becoming more and more obsolete, and those companies who have not expanded into ...

Starbucks redefined the coffee industry and changed the way that people buy coffee beginning more than 20 years ago. Starbucks became the first global coffee chain to normalize the idea that coffee shops could be as common a gathering place as your home or work. They continue to capitalize on their core competencies today—number of locations, customer experience, quality and social relevance in their customer’s lives.  Competitive advantage exists when a firm is able to create more economic value than its rival firms. Starbucks stands at a crossroads today. They have missed their projected sales targets for four quarters as of January 25, 2017, and in April of 2017 executed a change in CEO from Howard Schultz to Kevin Johnson. There are two significant external factors that stand to impact Starbucks’s strategy over the next few years: the threat of high-end niche coffee shops emerging throughout the U.S. and the changing dynamic of the way that consumers spend less...