The typical question on the first day of college in marketing class, What does Starbucks sell? If you are clueless, you have most likely answered that it sells coffee since it would be the most logical answer, unfortunately if you answered this your teacher surely humiliated you in front of to your colleagues and gave you a lecture that actually sells experience, but in case you still have doubts about why Starbucks does not sell coffee, in today's video I will explain a little about the business strategy of this transnational coffee shop, so that In the end it is clear to you what the Starbucks experience is and why it has never sold coffee. In order to explain what Starbucks really sells, we have to start by defining a term that might seem complicated but is actually much simpler than it seems.
The Customer Experience encompasses from the discovery of the product or service to the attraction, the interaction, the sentiment provided and transmitted, the purchase, the use, dependence and the promotion of the product or service. In other words, it is the entire customer's shopping experience including their emotions regarding the process and the product or service. It must be taken into account that customers today have the entire world market at their fingertips; there is a large number of products and services, own brands, private labels , a variety of prices and qualities.
The harsh reality is that if you are a company, you know that your competitive advantage has its days numbered and will be vilely copied sooner or later by your competition and that your benefits will be temporary and will tend to zero with the speed of lightning. This situation of continuous change is accelerated by the crisis such as the one we are experiencing due to the pandemic and companies then have to look for a stable base, a sustainable and lasting competitive advantage that can survive even with economic crises. And one way to do that is by selling feelings and emotions, something Starbucks has done perfectly.
Starbucks Marketing focuses on engagement and loyalty with its loyalty strategy. This multinational has won the hearts of consumers, not only with a good product and impeccable customer service: Starbucks' strategy has always sought to differentiate itself through offering value, especially in its digital campaigns. Starbucks Marketing strategies have made consumers fall in love.
It is no longer just the search for apps to facilitate payment on the phone, nor is it a benchmark for customer service, nor that it was the first cafeteria to implement free Internet access, which by the way is already very common today. globally, Starbucks is the result of a company philosophy that the customer has chosen the center of all its global strategy. And all of this has made Starbucks competition try to copy your stocks.
The digital strategy has emerged as a model of Emotional Marketing. Which is based on a strong affective connection between the brand and the customer. Assuming that most purchasing decisions are based on emotion and creating an emotional connection with the consumer.
With this new business model, Starbucks has managed to create a community of consumers loyal to its brand, which makes them a benchmark despite their high price. And, success is not a matter of chance, but is based on responding to unmet needs, and Starbucks has achieved this by examining the individual demands of each consumer. The main value of Starbucks resides in the orientation of its brand towards a buyer person who wants to belong to a select community, which in this case would be men and women between 25 and 45 years of medium or medium-high level, who live in cities, to those who like new technologies and customization and are aware of the latest trends.
Starbucks Marketing strategy has led its audience to see the sale of coffee, not as a product, but as a service: and this is where the famous 'Starbucks experience' comes in. When you think that Starbucks sells coffee, you are not bad at all, however, wouldn't it seem expensive to sell a simple coffee for $ 4? And above all, a coffee that is clearly not the best?
That's where the magic of what Starbucks sells is, the coffee shop seeks to create an emotional connection with the customer, their products are that expensive because Starbucks sells an experience, and provides a corner where you can meet your friends for hours, talk, be happy, enjoy, work, read, connect to the internet and all this seasoned with the smell of a good coffee, and this is where I ask you again, do you really think that a Starbucks coffee is expensive? By putting everything Starbucks offers into context, we can even think that coffee is cheap. Starbucks can be your day-to-day office, or the meeting point of your family and friends since it is an ideal place to be, coffee is the complement, but what Starbucks really seeks is to offer you a cozy place where you enjoy being and spend time and with this build customer loyalty , something they have certainly achieved since it is one of the most successful companies on the planet, a company that dominates its market to such an extent that there is no other brand that comes close to it.
And from this case we must learn how valuable customer experience can be for our companies . Because if something can last longer than a product or service, it is experience. Currently there is a great opportunity to differentiate yourself using emotional management of customer needs so I invite you to give it a try, as it is a model that has proven to be successful.
Investors, I send you a big hug, take care of yourselves and see you soon.
