Individual Assignment

The CRM strategy that Starbucks tries to implement with their clients is to seek that is offered is the most personalized possible and that each of the thousands of shops around the world offer the same quality service that offered the first store the chain opened. Starbucks manage its relationship with customers through four ways.

Firstly, providing high quality products is critical for Starbucks to satisfy customers. Starbucks’ trademark was the unique features of the coffee-based beverages. These innovative drinks have attracted new customers to experience luxury coffee drinks at affordable prices, in a very cozy environment. Starbucks created a coffee culture through educating its customers on the coffee types, origins, and the roasting process, which results in building brand credibility and gaining clients’ trust in the brand and quality of products provided.

Secondly, providing customized and seasonal products for its customers. Starbucks’ brand name and popularity came through customizing the beverages to the consumer’s desire through offering flexible drink options such as extra cream, caramel syrup and so on. Starbucks also introduces various and new seasonal products to differentiate themselves from its competitors and to attract new consumers. The new drinks add to the overall experience of loyal consumers and this specialization increases its competitive advantage over other competitors in the market.

Thirdly, Starbucks make loyalty programs because Starbucks recognized that one of the ways to obtain customer satisfaction is by manipulating their perception of equity and fairness in gaining maximum return for their money and loyalty. So, Starbucks introduced the Starbucks Loyalty Card which gives great benefits to its customers; ranging from syrup and milk options on their drinks free of charge, complimentary coffee refills and free beverage with whole bean purchases.

Finally, Another successful tool in managing long-term relationship with loyal customers is “My Starbucks idea” that is a webpage dedicated for customer feedback. On My Starbucks Idea, customers can post their ideas and suggestions for change and discuss existing products and services. The website is responsible for the re-launch of the rewards program based on customer discussions. My Starbucks Idea builds a connection between the large corporation and its customers.

As the case mentioned, Starbucks insists on innovation by introducing new products and convenience by allowing customers to pay for purchases with their iPhones. In addition, Starbucks attaches great importance to suggestion of its customers.

Q4: Evaluate the effectiveness of the differentiation strategy used by Starbucks, now and in the future.

According to Volberda et.al (2011) mentioned that the differentiation strategy means the company uses a set of actions