AUSMAT (SCKL) BME TASK 5A INVESTIGATIVE ASSIGNMENT
APPENDIX 1
AUSTRALIAN MATRICULATION
BUSINESS MANAGEMENT & ENTERPRISE
TASK 5A
Class & Intake Jan Intake, BME 1
Group Members Ee Shin
Tay Jin He
Wayne Stephen
Rohan Shanmuganathan
Questions Marks
ONE /3
Word Count: 1444 TWO /14
Dateline: 09/08/2024 THREE /3
Cover Page Word Count: 50
Total /20
Starbucks Triple Shot Reinvention Strategy with Multiple Paths for Long-term Growth
1. Starbucks corporation, commonly known as Starbucks, is a popular company that sells,
promotes and specializes in coffee roasting. Along with a wide variety of coffee and tea drinks,
the establishment offers food and snack choices, as well as packaged roasted whole beans,
ground beans, and other related products. In addition, Starbucks sells a wide range of drinks
through multiple outlets like grocery stores, warehouse clubs, convenience stores and specialty
retailers amongst others. The list of such drinks includes Frappuccino blended coffee, Iced
Espresso Classic (R) Flavored drinks, Starbucks Double shot espresso beverages and ready-to-
drink chilled multi-serve.
Starbucks requires the Triple Shot Reinvention Strategy due to a combination of market
saturation, rising competition and continually changing consumer preferences. Starbucks’ fast
growth has saturated several markets in some areas necessitating differentiation. There is need
for Starbucks to re-evaluate its product offerings and in-store experiences because customers
are increasingly asking for more convenience and variety. The coffee industry continues to
become more competitive as specialty coffee shops and other beverage companies face stiffer
rivalry today than they ever did before. To combat these challenges while battling with other
firms in the industry, Starbucks needs to redesign its stores, diversify product lines, and reaffirm
their commitment towards sustainability.
The Triple Shot Reinvention Strategy aims at enhancing the Starbucks brand by opening more
stores and increasing its efficiency. It also concentrates on making its digital capabilities more
robust by increasing the number of people having Starbucks Rewards accounts and supporting
other technological activities. This strategy aims for a $3 billion savings over three years to
boost shareholder returns, a global growth to 55,000 stores by 2030 and a revitalization of
partner culture through a renewed mission, promises, values and investment in the partner
experience.
2. a) Starbucks' "Triple Shot Reinvention" plan includes some noteworthy innovations, such as
the use of Just Walk Out and Amazon One to improve the in-store experience. Refers to modify
and enhance the feature by using e-commerce to buy their items, by using credit cards or Visa
cards, and the high value of their food and beverage supply from the company, which is one of
their products. To better serve client needs, the company built a fully automated system that
makes it easier for customers to purchase their items. The only company offering biometric
payment technology that lets users pay with just a palm scan is Amazon. Customers can make
purchases more conveniently and securely by connecting their palm print to their payment
method. The client does not even have to struggle to purchse without casah .
b) For the purpose of ensuring that their innovation activities are successful, Starbucks has put
in place several measures including technology and digital transformation commitment. To
improve customer satisfaction and optimize operations, Starbucks has also made significant
investments in technology. This plan includes smartphone ordering as well as payment and a
digital loyalty system. Through their app, Starbucks introduced the Mobile Order & Pay
function that allows customers to place orders and make payments ahead of time. It will also
make it more convenient for customers while at the same time reducing waiting times and
enhancing store productivity. Additionally, through its mobile app integrated prizes scheme,
Starbucks encourages its customers to give repeat business by giving them gifts, customized
orders and exclusive discounts. This digital loyalty program has succeeded in keeping
consumers around for longer periods as well as making sure they spend more money in the
process. During a 2019 earnings call, Starbucks disclosed that nearly 40% of sales from
company-operated stores in the United States were driven by its rewards program.
Secondly, when the “My Starbucks Idea” platform was introduced by Starbucks in 2008, there
was a platform available for user feedback. The corporation’s customers were allowed to
suggest proposals and debate about them with this corporation through it. By involving
consumers in innovation processes through customer input, Starbucks could create new
products and services that relate to their audience as well as satisfy their requirements. For
example, the suggestion made by users on this platform led to the development of mobile
payment app, providing free Wi-Fi and drinks customization options. A community driven
approach to innovation was encouraged so that Starbucks kept close relationships with its
clients and ensured that the innovations would be well received and successful. Apart from
helping Starbucks innovate, this effort towards enabling a sense of community in addition to
customer loyalty also involved customers in developing new goods.
c) Expanding Starbucks’ operations globally can greatly increase the revenues and profits of
Starbucks by reaching new people in diverse markets that will ultimately increase the number
of customers. Starbucks would be able to benefit from the increasing demand for top coffees
as well as café experiences by establishing a foothold in fast-growing regions like Asia and the
Middle East. Apart from that, international markets usually have low operating costs and offer
favorable exchange rates, which increases profitability. By customizing its products to match
local flavors and preferences, Starbucks could attract different customer segments hence
boosting sales turnover and brand loyalty. Consequently, this strategic global presence ensures
it has diversified revenue sources while also reducing overreliance on any specific market.
Global expansion enables Starbucks to diversify its revenue streams across various regions,
thereby reducing dependence on any single market. This geographical diversification plays a
crucial role in mitigating risks related to economic downturns, political instability, and other
region-specific challenges. The noticeable expansion of Starbucks in China exemplifies the
potential for significant growth outside the United States, and investing in diverse regions in
other country serves as a protective measure against localized market fluctuations. Through the
utilization of these benefits, Starbucks is trying to sustain the long-term growth, bolster its
global brand presence, and establish resilience against market volatility.
Furthermore, global expansion can help Starbucks achieve economies of scale through large
network of stores and centralized operations. Economies of scale refer to the cost advantages
that a company acquires as its production levels escalate. This is primarily due to the reciprocal
relationship between the output volume and the fixed cost for each individual unit. As the
quantity produced grows, the fixed cost per unit tends to decrease. Starbucks can obtain lower
prices of resources by negotiating with coffee bean suppliers as they are purchased in larger
quantities. On top of that, efficient management is possible through standardized processes and
brand consistency across different markets which further spreads fixed costs like Research &
Development (R&D) and advertising over a wider revenue base. Moreover, the uniform store
design along with menu simplifies training as well as supply chain logistics consequently
enhancing global operational efficiency in addition to cost savings.
3) To offer to a more youthful age gather for Starbucks' "Triple Shot Reexamination
Methodology," centering on a lock in and personalized client encounter through inventive
computerized and social media engagement would be exceedingly successful. One of the ways
Starbucks can offer to shoppers for a more youthful age gather is by actualizing an Intelligently
Computerized Dependability Program with Gamification Components. Consolidate a gamified
devotion program inside the existing Starbucks app that targets more youthful buyers by joining
intelligent components, rewards, and personalized offers. This method doesn't just encourage
more visits, it also helps create a community feel and fosters brand loyalty among the younger
crowd.
One of the keys highlights includes Personalized Challenges and Rewards. Starbucks might
organize every day and week by week challenges. Make customized challenges that energize
investigation of modern items or menu things. For case, attempting a modern refreshment or
customizing their arrange with regular flavors. In expansion, Starbucks seems to offer special
rewards. Starbucks ought to offer select rewards like limited-edition stock, advanced
identifications, or sneak looks at up and coming items. Final but not slightest, point of reference
accomplishments. Open uncommon rewards or encounters. For illustration, free drink or a
advanced collectible for coming to certain investing or support turning points. Another key
highlight is Social Media Integration. Shareable Substance energize clients to share their
accomplishments and encounters on social media stages, such as Instagram and TikTok, to pick
up additional focuses or rewards.
One of the execution steps is Advertise Investigate and Client Criticism. Starbucks ought to
conduct center bunches and studies with youthful shoppers to recognize inclinations and
desires. By analyzing information from existing app clients to tailors highlights and rewards.
Besides, App Advancement and Testing. Starbucks might accomplice with tech engineers
specializing in gamification and AR encounters to plan and construct the modern highlights.
Conduct beta testing with a select gather of clients to assemble input and make essential
adjustment.
Contribution Table:
Group member Question
Ee Shin 1
Tay Jin He 2A, 2C
Wayne Stephen 2B, 2C
Rohan Shanmuganathan 3
REFERENCES
Doraisamy, Durga , and Reggie Borges. Starbucks Reports Q4 and Full Year Fiscal 2019
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Loo, A. (2022). Economies of scale. Corporate Finance Institute.
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Livescault, Jonathan. “My Starbucks Idea : An Open Innovation Case-Study - Braineet.”
Www.braineet.com, 2022, www.braineet.com/blog/my-starbucks-idea-case-study.
MarketLine Company Profile: Starbucks Corporation. (2024). Starbucks Corporation
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Narasimhan, L. (2023). Starbucks Fiscal 2023 Annual Report.
https://s203.q4cdn.com/326826266/files/doc_financials/2024/ar/fy23-annual-
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Neuro , B. (2023, November). MSN (P. Rajkmari , Ed.). Www.msn.com.
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starbucks-ceo-unveils-long-term-plan-for-enhancing-revenue-and-global-outreach/ar-
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Taylor, Kate. “One of Starbucks’ Biggest Strengths Is Becoming a Huge Problem for the Chain
- Business Insider.” Business Insider, Business Insider, 27 Jan. 2017,
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