Demographics
Demographic studies are based on factors such as race, sex, age, economic status, income level,level of education,and employment, among others. Demographics are used by corporations , non- governments and government organizations to learn more about policy development and economic market research.
Demographic trends are also important to the size of different demographic groups will change over time as a result of cultural, economic and political circumstances.
For Demographic factors I will be talking about what age group do Starbucks target.
Adults : The primary target is women and men aged 25 to 40 which they account as almost half of its total business as most of them are business men and women . Starbucks appeals to this consumer age group with their contemporary design that is consistent in their decor and advertising. Starbucks works to keep its products at a certain level of status to accomodate all the factors above. Customers tend to be from the urban areas with relatively high income with professional careers and a social welfare . This target audience grows ata rate of 3% each year.
Young Adults : aged 18 -24 have a 40% of Starbucks sales. Starbucks positions itself as a place where college students can come to study , hang out ,meet people and write term papers. It appeals to the young consumers directly through the new technology as soon as it becomes available , focusing more on social networking and cultivating a ‘‘Cool image‘‘. This target audience grows at a rate of 4.6 % each year.
Kids and Teens : are a large part of Starbucks also . Constomers of age 13-17 account for just 2% of Starbucks sales . Most of the items are bought by their parents , whether the focus is on the steamed milk or the sugary, caffeinated drinks that are so popular with teenagers. Kids come to Starbucks with their parents while teenagers use Starbucks as a place to hang out with their friends or to study. Starbucks make their products kid-friendly and offers special child size drinks.
Regulatory
Starbucks has the following statement when it comes to internal and external regulatory and policy “We think it’s important to take a sand on issues to support our business and because it’s who we are and how we operate. That’s why we believe we have a responsibility to advocate both internal and public policies that support the health of our business, our partners (employees) and the communities we serve” Starbucks. (2015).
Starbucks have a long rage of policies in place from global ethical standards to their internal guidelines of how they operate their business. The policies that Starbucks uses it’s not just for their company but also applies to all of their producers of coffee & other products they sell in their shop. Starbucks regulatory policies touches on every aspect such as:
• Workplace Environment – How the company treats the customers and their employees, diversity, wages, workplace health & safety, consumer protection.
• Conduct or Practices of Business – How the company do international business, sales and advertising, compliance with laws & regulation, interact with local governments.
• Information of Property & Proprietary – How they keep confidential information on employees & customers, keeping records, audits and financial audits.
• Ethical Decision Making.
Starbucks also has a strict regulatory policy when it comes to their producers making sure that, animal welfare, human rights, equal employment opportunity, deforestation, cocoa practices, coffee and farmer equity is kept under strict supervision and abided to all regulations. Thus making the company Sociably Responsible for Manufacturing and selling of their product.
Infrastructure
Stabucks plans to open stores across low-to-medium income urban community areas across the United States and Europe. Each of those locations are planned to have an onsite training space .Starbucks usually will partner with the local youth service organizations which helps to connct youth with internships. Come up with apprenticeships and jobs in the community.
In order to determine which community will make a good fit for the new store concepts, Starbucks examines all the availabe data to understand which communities have the biggest opportunity gap. Which lead to bigger business investment and leaderships to build a better future for the company.
Partners
They seek out and engage partners who are as diverse as the communities they serve. they focus on partner development by educating and engaging their partners.
Starbucks main partner is Espresso but at the same time they consider that the position and dedication of their extensively trained baristas that determines whether the customers coffee is good or if it is perfect. It is a sentiment that is instilled from the very beginning of their training . This means that no matter how good the beans are or how dark the roast, or how great the tools are its up to the baristas to make it the way you like it.
Social – Culture
Globalization is a lifestyle fueled by the media and internet resulting in the spread of the western cultures in the developing countries .The social factors that may contribute to Starbucks Coffee may have a long-term growth prospective. Starbucks is known to be a spending time with your friends and enjoying a fresh cup of hot or cold coffee, as it associates with the American and European lifestyle in consumers preception as such.
Individuals from developing countries are attrached to the American and European values that may represent the future in a new community.
There are certain social factors at the same time that may have a bad inpact on Starbuck`s long-term growth prospects. Due to caffeine and sugar consumption increasing health concern among the population.
Most local coffee shops are unfamiliar with the quality of coffee and service Starbucks provides. Some might be surprised to find a land known for its coffee beans offering watered down and low quality coffee to its customers. More often than not the barista and bus boy are one in the same. The locals prefer darker and stronger coffees and Starbucks can prepare a blend made from locally sourced beans. Starbucks’ highly infused milk and cream drinks fit in well with the taste of the locals.
Some differences between domestic and the foreign market lie in the language. English is our primary language in the US and the Brazil’s primary language is Portuguese. Although, Spanish is spoken in both countries, it is not the dominant language in either country. Other differences could include space. In America, if a person were to get too close, they would see it as an infringement of their personal space and possibly rude. However, in Brazil it’s not unusual to give two kisses on the cheeks as a greeting and the space between people in conversation is much closer.
The US is also an individualistic culture whereas Brazil is more cohesive. In the US, people mostly look after themselves and their families and are mostly self-reliant and display initiative. In the work-place, Americans are also encouraged to show evidence of what they have done or can do to gain a promotion. Because Brazil is a more cohesive society, they tend to rely more on loyalty. In the work-place it would be expected that an older relative find a job for a younger relative within their company. Another big difference would be the level of long-term orientation. The US has a low level of long-term orientation meaning we are a short-term oriented culture. Our profit and loss statements are measured quarterly and individuals often strive for quick results in the work place. In contrast, Brazil is high in long-term orientation. They easily accept change as a part of life and accept more than one truth.
Conclusion
Starbucks is a well established part of the coffee house culture in the UK, well regarded for its ethical approach to sourcing and buying coffee beans. There are global opportunities for the firm as well as niche markets within the UK to exploit. Although not the number one firm in the coffee house market (a position held by Costa Coffee) Starbucks has developed a strong following amongst the youth and student segments; whilst continuing to provide the requisite products for the working population in their busy working day.
Having weathered the temporary storm of bad publicity over the income tax evasion scandal, Starbucks has worked hard to improve its position in the eye of the consumer by emphasising the ethical and sustainable principles the firm has always maintained. Such communication and relationship marketing is key to long term brand loyalty. Despite fears that coffee may be bad for health there is also evidence to support drinking coffee in moderation to have preventive value against certain diseases.
Starbucks is well placed to continue to trade competitively in the UK market, particularly as it continues to find and exploit new and innovative ways to get their product out to the consumer in the form of drive-thru’s and kiosks in high footfall areas. There seems little sign of the trend and fashion for coffee houses to diminish any time soon and it continues to be part of the UK culture just as it was over 300 years ago.