College of

Business
Administration

Management and Marketing Department

Case Study Analysis
Submitted by:
Ballesteros, Ronley Jefferson S. Ocampo, Peter Joshua A.
Batulan, Josiah P. Serrano, Fionna Alyzzah M.
Dy, Paul Darwin D.S Sy, John Steve P.
Fernandez, Clariza Mae C.

Submitted to:

Dr. Maria Nimfa R. Diaz

Date: December 19, 2020

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 A CASE STUDY ANALYSIS OF

STARBUCKS CORPORATION

A CASE STUDY

Presented to the Faculty of Management and Marketing

College of Business Administration

Adamson University

In Partial Fulfilment

of the Requirements for the Degree of

Bachelor of Science in Business Administration Major in Marketing Management

By:

Ballesteros, Ronley Jefferson S. Ocampo, Peter Joshua A.

Batulan, Josiah P. Serrano, Fionna Alyzzah M.
Dy, Paul Darwin D.S Sy, John Steve P.
Fernandez, Clariza Mae C.

December 2020

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Background of the case ………………………………………………………………………... 4

View point …………………………………………………………………………………….…4

Time Context ………………………………………………………………………………........5

Statement of the Problem ............................................................................................................5

Statement of the objectives .........................................................................................................5

Areas of consideration (SWOT Analysis) ................................................................................. 6

IV. Assumptions ......................................................................................................................... 8

V. Alternative Courses of Action (ACA) ...................................................................................9

VI. Analysis ................................................................................................................................. 10

VII. Conclusion .......................................................................................................................... 12

VIII. Recommendation .............................................................................................................. 13

IX. Plan of Action ....................................................................................................................... 14

Appendices/Bibliography ........................................................................................................... 15

Resume Curriculum Vitae ......................................................................................................... 17

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 BACKGROUND OF THE CASE

Starbucks has been known as one of the top-tier beverage companies through the years.

They serve beverages more than the coffee itself and the ambiance of every store is what makes

the customers go back and forth. It has a lot of branches around the world. Here in the Philippines,

there are 364 Starbucks physical stores located all over the country. Its first branch was built in

Seattle, Washington, on March 31, 1971. Since Starbucks Corporation is one of the largest

companies, it also has a large amount of revenue loss during this pandemic. Starbucks Corporation

has reported its first quarterly loss in seven (7) years which is extremely frustrating for the

company. On the other hand, not only the CoVid-19 became one of the major problems, but also

the new rising companies in the beverage industry that offers almost the same product but sells it

for a cheaper price. This study will focus on how the company will sustain the financial problems

and the loss of the brand’s factor given the fact that the country is still in the middle of a pandemic.

POINT OF VIEW: Howard Schultz, President & CEO

A 67-year-old-man named HOWARD SCHULTZ is an American businessman who

graduated from Northern Michigan University. He is the founder of Starbucks Corporation and he

serves as the chairman and chief executive officer of the company. He also held the title of chief

global strategist. Mr. Schultz has always been looked up to, owing to the fact that he has a lot of

achievements. Regardless of those, he is really something more. He firmly believes that “Young

people should never allow anyone to tell them that they are aiming too high.” This only implies

that he also built his dreams as a kid and conquered it with greatness by being passionate for what

he loves.

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Time Context: March 2020 - June 2020

The pandemic started on the 2nd week of March and in a span of just 3 months, the CEO

stated that the Starbucks Corporation has lost as much as $3.2 billion due to the coronavirus

pandemic. This shows how quick a business can go down even in a short period of time.

STATEMENT OF THE PROBLEM

Starbucks has a market value of $92.6 billion and has depreciated 10% this year due to CoVid-19

pandemic. In prior to this, the corporation released statements in which most of the physical stores

were forced to close since the company had lost $3.2 billion in revenue in the latest quarter.

Furthermore, there are new arising beverage companies which became another problem for the

sales to increase.

STATEMENT OF OBJECTIVES

• Increase in net income of the company in the midst of pandemic

• To have more business partnerships

• Survive the financial struggles

• To improve marketing strategies

• Maintain the excellent image of the brand

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AREAS OF CONSIDERATION

STRENGTHS (Internal Environment)

A. Strong Brand Image - Starbucks is well-known for their strong brand image, this became an

advantage for them whereas it attracts more customers and even investors. Customers tend to buy

products from Starbucks in their own will, due to the fact that they have been labeled as one of the

most trusted brands.

B. Location - it is not hard finding Starbucks’ physical stores since most of the malls today have

their own Starbucks branch in it. Consumers can find it easily nowadays without wasting their

time just to look for it. Starbucks has the advantage to sell their products everywhere, even in

gasoline stations and stopovers.

C, Product Quality and Standardization - Starbucks produces high quality and many varieties

of products that most customers are committed to avail. Starbucks itself is also a “trend” in this

generation, most people still purchase Starbucks’ product despite it being pricey since the quality

of the products meets and exceeds the customers expectations.

WEAKNESSES (Internal Environment)

A. Inflexible Price - most of the top-tier brands’ weakness is its inflexible price. Starbucks

products are very pricey and some of the customers do not prefer expensive products. One of the

reasons why the products are costly is because of its quality. High-end taste also comes with a high

price.

B. Common Variety of Products - most of the customers want something new for their own

satisfaction. Consumers nowadays want to explore a new variety of product they don’t usually

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encounter. It is one of Starbucks’ weaknesses, since they rarely produce new products and always

stick to what they are accustomed with.

C. Undisciplined Marketing - when other companies were aggressively advertising, Starbucks

didn’t mind to advertise. It looks like the company became overconfident since the brand has been

dominating for years. The Starbucks Corporation doesn’t even have advertisements in physical

stores, social media platforms and even commercials. Most consumers buy products based on their

marketing strategies and how often they see the product being advertised.

OPPORTUNITIES (External Environment)

A. Business Partnerships - Starbucks can use their strong brand image to earn more

collaborations, partnerships, and investors. It will pull them closer to a great opportunity to be

recognized more. They can expand their company by building relationships with other companies

by doing partnerships with them.

B. Growth of Platform/s - enhancement of platforms and implementing something new regarding

the marketing strategy would be a big thing. Starbucks, being a big company, has the capability to

open a lot of opportunities. The corporation just needs to be more creative. Revision of marketing

plans and restructuring market strategies are advisable.

C. Digital Marketing - if they want to try something new regarding advertising, digital marketing

would be a great opportunity for them. Most of the customers are in social media platforms, and

having a digital presence can help them to increase their market. Due to this pandemic, most of

the people refuse to go outside, Starbucks should take this opportunity to ise digital marketing as

it will help them a lot to expand their market and to earn more.

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THREATS (External Environment)

A, Market Rivalry - many companies have been appearing lately having the same products as

Starbucks. It is given that it wasn’t a big shot like Starbucks, but having almost the same products

can surely be a threat for them and most probably attract some of the customers since the price is

much cheaper.

B. Customer’s Preference - customer’s preference can be a threat to any company. As time goes

by, trends are changing and so as the customers’ preferences. In every business, the customers are

always the boss. It is also true that in the world of business “Customers are always right”. Products

must always be relying on people’s demand. Having a bad response from the customers can be a

major threat to any company.

C. Environmental Uncertainty - just like the recent happenings, due to the pandemic COVID-

19 starbucks lost its revenue as much as $3.2 billion. Also they do not offer delivery service, they

only have walk-in service, it is one of the reasons for losing such a large amount of customers and

income.

ASSUMPTIONS

• Unforeseen events may lead to loss of income like the situation today. Because of the

pandemic most of the companies did not meet their target income and it resulted with

closing of stores. Every business must know that there are certain events that will affect

their companies. Continuous disasters may lead to loss of the entire business.

• New generation may encounter less job opportunities. Since there are companies that may

be closed for good, there will be less job opportunities for fresh graduates.

• Every company in the food industry has its best-seller product and it is what makes the

company name remembered. By exploring and producing new varieties of beverages, there

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 will be one outstanding flavour that will be a turning point for the company to gain new

customers.

• Reassessing each and every company employee is a great start. Evaluation reveals how

effective or ineffective someone can be for his/her position. Hiring someone who is

knowledgeable enough will lead to excellent company control.

ALTERNATIVE COURSES OF ACTION (ACA)

ACA #1

• To have a new set of different flavors of beverages depending on the month and/or season.

Not only on christmas but also on special occasions.

ACA #2

• Starbucks would cut the prices of the products.

ACA #3

• Provide proper sanitation such as alcohol and/or hand sanitizer for further health concerns.

It is also advisable to come up with giving safe and comfortable face masks for the

customers in every purchase, whether it is dine-in or take-out. Also, there should be a

limited time for the customers to spend inside the store.

ACA #4

• Closing other branches.

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ANALYSIS

ACA #1

Advantages

• Consumers would be excited to grab a drink every month.

• People would taste a new flavor and not the usual flavors in the menu.

Disadvantages

• It will be pricey since every drink will contain many ingredients.

• Not everyone is fond of the flavors that will be out.

ACA #2

Advantages

• Cutting or lowering the prices of the product being sold can attract more buyers. There will

be more customers that may afford to buy the products.

• It will be a stepping stone to launch a new product line since the price will just be the same

with the old flavours.

• It will help to increase the demand of less saleable products.

• It has a fast turnaround time in inventory which means it can be easily taken out from the

storage or warehouse.

• From the point of view of the supplier, it can seek higher discounts for the supplies needed

since it can be easily sold to the market.

Disadvantages:

• It could embarrass some customers who have already purchased the old products from

previous visits.

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 • It gives low profit since its margin of expenses from income is almost near.

• There will be an expected decrease in revenue.

• The customer may be hesitant to buy due to its lower amount thinking the quality of the

products are also lowered.

ACA #3

Advantages

• Consumers will be more encouraged to buy some drinks and spend their time inside the

store without any worries.

• Many customers who want to spend their time inside the store can have more space, since

everyone has a limited time only.

Disadvantages

• Some consumers are very impatient and very demanding.

The store’s expenses will increase since they are providing facemasks and alcohols.

ACA #4

Advantages

• Concentration to manage other branches can be easily done.

• Eliminate losses that other branches may occur in their operation.

• May eliminate multiple tasks among employees which have volume work assignments.

• Shortage in capital and operational requirements can be lessen..

Disadvantages

• Customers will wonder for the closures of the branch which will tend to believe that it incur

losses.

• It will prompt the termination of employees and economic instability of the business.

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Conclusion

Starbucks is a well-known beverage store since 1971, it sells coffee, tea, frappuccinos, and many

more. It has a comfortable and authentic vibe inside the store. There are 364 branches that is

located here in the Philippines. In every business there will always be some issues and

circumstances, especially when an enterprise has a lot of competitors, which is one of the main

and common problem of a business. Starbucks reported that the pandemic totally affected their

business. Ever since the pandemic started most of the business, small, medium, and big businesses

were truly affected including the Starbucks. In almost seven (7) years they have lost most of their

consumers, which makes their company put in a lot of trouble. Another thing is that many coffee

stores and milktea shops had already opened and offers cheaper prices of products than Starbucks,

which became of the problems of the store. If there is a problem, there would be always a solution

and the most effective way for this circumstance to be solved is that they should think of a new

market strategy that would gain their loyal customers’ attention again and they must also think on

how to survive in the midst of pandemic. Starbucks has a strong brand image that even kids and

older ones are familiar with it and that is what they can hold onto. Another thing that they should

keep in mind is never compare their store to other store, every store has its uniqueness and that

makes their establishment known. In Starbucks, they are known for having a neighborhood vibe

and having lots delicious pastries and beverages. The purpose of this study is to know that in every

enterprise there would be a problem and some of them may find it very hard to solve it, but an

entrepreneur should keep in mind that in every entrance there is an exit. Another thing, is to give

awareness to every people that why some company are shutting down and to know that pandemic

really gave the company a hard time to cope up with the new normal.

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 RECOMMENDATIONS

1. Lower the price

Lowering the price of the products will give the store more advantages compared to other

beverage companies. Few customers tend to buy cheaper drinks everyday. Less expensive prices

in stores attract more customers.

2. Wide choices of foods and drinks

This will help customers to eat something rather than skipping a meal. Unique and mouth-

watering products are one of things that should be improved. Most of the customers tend to choose

stores with wide choices of foods and drinks to satisfy their cravings.

3. Offer freebies

It is common with people that they would always love something to take home to consider

a product or a service “worth it”. Giving away freebies is a great gesture to attract customers. This

will also serve as a trademark and by that, Starbucks would always be remembered.

4. Relocation of the stores

Relocating to crowded areas such as, schools, malls and places within nearby offices may

save every business from bankruptcy. This will be appealing for people who love to discover cozy

places to hang out with. This will also lessen the company’s expense when relocated to inexpensive

places.

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5. Brand development

This will help to improve and enhance the company’s credibility and impression to the

public. Customers often remember the store that is occasionally doing this strategy. This will also

help Starbucks to create brand awareness and exposure.

PLAN OF ACTION

Action Step Responsible Start Date Milestones Due dates Resources Desired
Outcome

Meeting with President / 01 – 18 - 21 Objectives 01 – 20 - 21 List of the Enhanced

the Executive and Draft following program for
Team CEO Plan points to marketing
improve products

Restructuring President / 01 – 22 - 21 Prepared new 01 – 25 -21 Breakdown Revised plans

Marketing & CEO and strategies & of the past and much
Strategic Plans Business business total sales better
Strategists plans using the platforms
old plans &
strategies

Election of Board 01- 26 - 21 Newly 01- 28 - 21 Votes & Much better

New Officers Members Elected Browsing sales and
Officers of strategies
employees’
records

Funding of the Chief 2 - 4 - 21 Control of 2 - 6 - 21 Income Enhanced

company Financial Finances of and Cash Flow &
Officer the Expenses Financial
Company Records & Management
Tally

Plan Research & Continuous Adjustments Continuous Revised Improvement

Implementation Development & more Plan for of the
Department disciplined every Company
employees designated
department

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 BIBLIOGRAPHY

(A. Lucas, 2020). Starbucks says it lost $3 billion in revenue in latest quarter due to coronavirus
pandemic.CNBC. Retrieved from URL.https://www.cnbc.com/2020/06/10/starbucks-says-it-lost-
3-billion-in-revenue-in-latest-quarter-due-to-coronavirus-pandemic.html

(P. Bondarenko, 2020).Starbucks.Encyclopædia Britannica. Retrieved from URL.

https://www.britannica.com/topic/Starbucks

(M. Bartugs, 2018).Case Analysis of Starbucks Corporation.Word Press.Retrieved from

URLhttps://mbartugs.wordpress.com/2016/10/19/case-analysis-of-starbucks-corporation/

(Biography.com Editors, 2020). Howard Schultz Biograph.The Biography.com website:A&E

Television Networks. Retrieved from URL.https://www.biography.com/business-figure/howard-
schultz

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BEFORE

DURING

AFTER

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 CURRICULUM VITAE

Name: Ronley Jefferson S. Ballesteros Name: Fionna Alyzzah M. Serrano

Address: 2740 Park Avenue Pasay City Address: Block 70 Lot 45 Las Palmas
Contact no.: 09286289642 Subdivision, Sta. Maria, Bulacan
Gmail:ronley.jefferson.ballesteros@adamson.ed Contact no.: 09216836645
u.ph Gmail:fionna.alyzzah.serrano@adamson.edu.ph

Educational Background Educational Background

Elementary: Jose Rizal Elementary School Elementary: Diliman Christian Academy
Secondary: Southeastern College Secondary: Sacred Heart Academy
Tertiary: Adamson University Tertiary: Adamson University

Name: John Steve P. Sy Name: Paul Darwin Ds. Dy

Address: 1811 B Dominga Street Pasay City Address: Bougain Villa St. Sampaloc, Tanay,
Rizal
Contact no.: 09064412850 Contact no.: 09201537972
Gmail: john.steve.sy@adamson.edu.ph Gmail: paul.darwin.dy@adamson.edu.ph

Educational Background Educational Background

Elementary: San Isidro Catholic School Elementary: Alpha Beth Christian Academy
Secondary: San Isidro Catholic School Inc.
Tertiary: Adamson University Secondary: Adamson University
Tertiary: Adamson University

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Name: Clariza Mae C. Fernandez
Address: Blk 3 Lot 25 Peso St. Veraville
Manuela Subdivision 3, Las Piñas City,
Barangay Pamplona Tres
Contact no.: 09173064781
Gmail: clariza.mae.fernandez@adamson.edu.ph
Educational Background
Elementary: St. Therese School, Las Piñas City
Secondary: St. Therese School, Las Piñas City
Tertiary: Adamson University
Name: Josiah P. Batulan
Address: 1026 Castillejos St., Quiapo, Manila
Contact no.: 09177656940
Gmail: josiah.batulan@adamson.edu.ph
Educational Background
Elementary: AIM Christian Learning Center
Secondary: The National Teachers College
Tertiary: Adamson University

Name: Peter Joshua A. Ocampo

Address: 645 6th St. Salinas 1, City of Bacoor Cavite
Contact no.: 09263514005
Gmail: peter.joshua.ocampo@adamson.edu.ph

Educational Background
Elementary: Salinas Elementary School
Secondary: Bacoor National High School (Tabing Dagat)
Tertiary: Adamson University

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