A Public Relations Plan For Starbucks Report Sample
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According to business analysts, Starbucks entry into the Chinese market was a well-calculated move. Notably, one of the attributes and features of Starbucks is its ability and aggressiveness about changing its major operational facets when it enters new markets. This is controlled by how the company views the local market in relation to the competition they face from local tea and coffee providers (Nisen, 2012). The company's operations in China have been successful since its initiation, and the firm seems to have a bright future in serving locals with coffee (Datamonitor, 2010). For instance, there are plans to conduct a massive expansion in China in the near future with projections of doubling its stores in the extensively populated nation (Strategic Direction, 2004). Studies have shown that expanding so quickly and aggressively especially in a nation like China where the country’s culture is defined by tea-drinking may be risky (Joan, 2008). However, as part of the overall strategy, Starbucks has shifted its products and food stores to adapt and have more of a local taste.
The first quarter of the 2014 financial year saw the company’s sales grow by over 7% in China alone (Branding in China). While plans to open up more than 500 different locations in China may seem a strategy to improve sales volumes, it is indeed a strategy of countering the stiff competition that the firm is encountering from local coffee providers (Burkitt, 2010). With the expanded market share, Starbucks could have China as its second largest market beyond the USA borders (Adamy, 2006). It is significant to consider some of the aspects that the company is considering so as to remain on top of the game. First the company’s stores in China are defined by spacious rooms with extra seating space (Angeles, Weidenfeller & Tan, 2013). Unlike the America customer’s who just grab a cup of coffee or Joe and walk out, Chinese consumers use the stores as their perfect destinations for tranquility (Lee-Young, 1998). They get into the stores, purchase their drinks and nurse them quietly as they do ‘something else’ such as using their laptops (Joan, 2008). This strategy has indeed worked (Joan, 2008). The company is also offering exemplary services and products to its consumers that include Chinese teas and other treats such as moon-cakes (Peterson, 2014). For instance, the company offers what the CEO refers to as a ‘top-selling limited-time’ Strawberry Cheesecake Frappucino (Fowler, 2003). Furthermore, the firm has done a lot to inform its local Chinese consumers on the food safety of their products by accurately labeling them indicating the countries they have been imported from.
However, despite all the success stories, there seems one big debatable challenge that requires more than mere management effort to address. While expansion may seem the key to success, maintaining a brand loyalty is more fundamental (Nisen, 2012). Chinese consumers have been noted to have little or no brand loyalty at all. Studies conducted in China by McKinsey and Company revealed that at least 65% of Chinese consumers leave a food store with a different brand than the one they intended to buy (Chen & Yusheng, 2009). This contrasts the American market where only 15% of the consumers can walk out of a food store with a different brand than the one they intended to buy. This is one big issue that requires quite a significant consideration (Peterson, 2014). Two factors guide Chinese consumer-brand relationships; the price of a product, and the transaction process involved (Nisen, 2012). However, a look at the past reveals that the Chinese culture has so far, had little or no choice among the different brands for a long time.
Richardson (2012) defines brand loyalty as the trustworthiness and allegiance that consumers have towards a particular product. It is the aspect that makes a consumer come for the same product every time they visit a store. Notably, brand loyalty is derived from customer satisfaction and fulfillment (Richardson, 2012). A customer will obtain trust in a brand that fulfills his/her desires to the maximum. However, with large amounts of branded coffee and tea products in the Chinese markets, building on brand loyalty is a strategy that requires planning and effective implementation (Peterson, 2014). With the estimated rise in household income levels in China, Starbucks needs a fundamental public relations plan to ascertain brand loyalty among its customers (Women in PR). Thus, this paper presents a public relations plan for Starbucks intended to help build brand loyalty among its customers in China. To arrive at conclusions statistical and case analysis were conducted in relation to the topic of discussion.
First and foremost, the campaign should be tailored to towards ensuring that customers have a link with the firm that is defined by their terms (Women in PR). For instance, the firm will include customers into its regular and recurrent e-mail newsletter to create a spirit of inclusion and recognition among the customers. Customers feel appreciated for their presence and thus, would rather do more business with the firm that recognizes and appreciates them.
Rather, that aimlessly drive sales without a clear course or target, the firm will build its business around and about its best customers, who, business analysts refer to as ‘brand-lovers’. Identifying the very core of Chinese culture will be central to achieving this objective (Chen & Yusheng, 2009). This is because; identifying customer needs is the basis focusing on ‘brand-lovers’. In essence, the campaign will be geared towards attaining a certain form of recognition among the firm’s favorite customers (Women in PR).
As noted earlier, Chinese customer-brand relationships are defined more by the value they generate from the products they purchase. The firm thus, will have to shift from the transaction machine based approach to a human approach. This will involve developing measures to serve real people in the real world and not virtual people in a virtual world (LuWang & Lin, (2010). When one values what customers have to say, it enhances and facilitates chances of improvement. This is one way of cultivating brand loyalty. In essence, before the firm can generate brand loyalty from its customers, it is imperative that it remains loyal to its customers to (Women in PR).
Primarily, the most basic objective of a public relations plan is to identify factors that influence a certain phenomenon (Women in PR). Hence, it would be fundamental for the firm to come up with attributes that make consumers prefer them over their competitors (Richardson, 2012). A good understanding of these factors is crucial in cultivating brand loyalty and normally defines the future of a business. While it’s not easy or simple to determine these factors, the campaign should be geared towards decoding both the conscious and unconscious motivating dynamics (Women in PR). This is the core of a public relations strategy.
According to Richardson, (2012) brand loyalty is based on the phrase ‘more reasons to stay and no reasons to leave’. This should be a guarantee in the company. Considering the Chinese market, which has different attributes compared to other markets such as USA; consumers prefer taking their coffee at the stores rather than walking out with it. Hence, Starbucks needs to continually make the lives of the consumers easier and even better through exemplary service that enhances customer experiences. In essence, there is need to refine algorithms through which customers can be served maximally to satisfy and fulfill their needs (Richardson, 2012).
Latent Publics: Consumers and Users
The firm intends to reach out to its customers and the public who use its products. The consumers or the market make up the relevant target for this campaign. As noted, Chinese consumers have a tendency of leaving a store with a brand they did not intend to buy in the first place (Ann, 2007). Thus, it is imperative that the message reaches out to the right target group, and that it is communicated in the most efficient way. Notably, Starbucks is currently facing a lot of pressure from the media for pricing their products quite higher (Business, 2013). However, the firm has responded by stating that it is due to the costly nature of conducting business in China (Business, 2013). One significant fact to note is that Chinese consumer-brand relationships are defined by the pricing of a product and the transactions they receive from a firm (Chen & Yusheng, 2009).
Therefore, the consumers make up the primary publics for this public relations campaign. There is need to let them understand the need to keep on purchasing products from Starbucks despite any detrimental factors such as price. Considering the situation analysis, enough has to be put at stake to tailor the messages being communicated considering the attitude that the consumers have on the coffee and tea products. As such, the public relations campaign will be initiated majorly to build on brand loyalty that seems to be lacking among customers. Moreover, to build on brand loyalty, it is significant to establish and understand the basic factors such as customer satisfaction, customer fulfillment and customer experience as the influencing or motivating factors towards a brand.
Public Relations Strategy
Notably, the public relations strategy should not be confused with tactics. Starbucks’ strategy to achieve brand loyalty will be the basis upon which the tactical program to achieve the same will be built. It should be understood that the firm’s public relations strategy is a mechanism that will be developed in order to achieve the campaign objectives stated earlier. The strategy is built around the need to enhance customer satisfaction, customer fulfillment, and customer experience as the basics of obtaining brand loyalty. Remarkably, the Chinese market is a difficult market to deal with yet, worth the effort of risking business (Law, 2013). Despite the presence of other dominant players in the industry, Starbucks has to generate a considerable action plan that would have an effect on the Chinese market. In this respect, Starbucks’s strategy will have two facets; to market products in order to establish brand loyalty and to obtain trust in order to strengthen brand loyalty.
Marketing products simply implies that the firm will have to improve brand awareness to generating more consumers and retain existing ones. Marketing is considered as a primary aspect when it comes to enhancing sales volumes and profit margins (Jackson, 2008). The firm will have to reach out to the consumers through various tactics (discussed later) to generate a strong consumer base that is loyal to the brand. Marketing, according to business analysts, plays a significant role in establishing a strong consumer base (Bengtsson, Fleura & Meera, 2011). It is an aspect that requires outstanding innovativeness, creativity, and consummate design to guarantee its usefulness. This strategy requires more than organizational effort. It needs commitment and corresponding dedication towards attracting customers and letting them know why they should choose Starbucks over the other available brands.
On the other hand, obtaining the trust in the consumer base involves being reliable to the consumers and meeting their needs as required (Jackson, 2008). Trust is not an easy word. Most consumer-brand relations are built on trust. Furthermore, the Chinese consumer culture, for decades, has been known to remain standing (Chen & Yusheng, 2009). Food safety is one aspect that Chinese consumers pay more attention to. According to the American Express Study cited by Jessica Zoob, only 53% of Chinese consumers trust foreign brands. Conversely, a record 86% trust local/domestic brands according to the same study (Branding in China). Thus, this strategy to obtain trust is crucial in strengthening brand loyalty (Young, 2013). Trust is a foundation stone for a positive relationship between a customer and a brand (Gonzalez, 2014). The more they trust a brand or a firm is, the more they will be committed to it. Hence, the needs to have it over and again without shifting focus (Sandholm, 2014). In general, as part of the overall strategy, obtaining consumer trust in the brand is vital for achieving brand loyalty.
Establishing a Connection with Customers
Chinese customers require more of experience than mere product transaction. The firm will ensure that it offers a sensory product package of its premium brand such that it links with who they are. Developing a link between the consumer and the brand is one step towards achieving brand loyalty. This connection should be based on the consumers’ terms such that what they are offered is more than what they required (LuWang & Lin, 2010). Connecting with consumers generates experience and familiarity that is, above all, the cornerstone of brand loyalty. Notably, connection with customers will be through effective communication and awareness programs (Richardson, 2012). As one of the policy measures taken by the firm to achieve brand loyalty, establishing a strong connection with consumers will be the key to improved sales and organizational success (Law, 2013).
Anticipating Consumer Needs
Rather than simply providing customers with what they require, the firm will anticipate what that may be (Jackson, 2008). The firm will embark on a plan to offer intuitive purchasing suggestions to consumers. This will not only see an improvement in the overall sales volumes, but, will also add value to customer experiences (LuWang & Lin, (2010). It is significant to put oneself in the shoes of the consumer and think rationally about what they may desire or what is good for them. This way, consumers have no other choice than purchase the anticipated product (Richardson, 2012). However, it should be noted that; history has it that not all anticipated products are a success. Nevertheless, this course is necessary for Starbucks given the product range it deals with (Bradsher, 2005).
Consistently Delivering on Quality
Bengtsson, Fleura and Meera (2011) note that brand loyalty is not only achieved by quality products, but also by the product consistency. Quality is primarily the number one aspect that a consumer establishes before they make a purchase (Richardson, 2012). This implies that, when the quality of a product is high a consistent, then customers are bound to purchase that product continually thus, generating brand loyalty (Chyon-Hwa, 2003). The consistency of quality products creates a positive customer experience that is crucial to achieving brand loyalty.
Ensuring Brand Integrity
It has been noted that Chinese consumers are more careful about food safety than any other aspect (Chen & Yusheng, 2009). This is why 86% of them trust domestic/local brands while on 53% trust foreign brands (Angeles, Weidenfeller & Tan, 2013). To gain more trust, it will be significant to develop brand integrity through registering Starbucks’ brands and trademarks in both Chinese and English versions (Jackson, 2008). Brand integrity is crucial in establishing, developing and maintaining brand trust (Richardson, 2012).
Public Relations Plan Evaluation
This kind of evaluation or assessment will be conducted throughout the campaign. During the process of campaign, specific aspects and stages will be examined to determine their effectiveness and efficiency (Women in PR). If working well, they will be improved upon, and if not working well, then they will be re-focused or re-aligned to fit into the campaign process. Normally, this evaluation process will be ongoing and will be conducted periodically in different phases (Women in PR).
This refers to an end review or assessment that is done after the public relations campaign has been finished. It is where the outcomes or results of the campaign are compared and related to the objectives of the campaign to determine conformity (Women in PR). In essence, it will include a critical analysis of each tactic in relation to how it has helped achieve an objective (Women in PR). It determines whether the campaign was successful or not. Furthermore, it helps determine the prevailing conditions and situation after the public relations campaign has been completed.
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