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Submitted by cheewan on February 26, 2006
Category: Business
Words: 7952 | Pages: 32
Views: 1654
Popularity Rank: 1,660
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1.0 Overview of Starbucks and its business situation
Starbucks founded in 1971, is the world’s leading retailer, roaster and brand of specialty coffee with coffeehouses in North America, Europe, Middle East, Latin America and the Pacific Rim.
Starbucks purchases and roasts high-quality whole bean coffees and sells them along with fresh, rich-brewed, Italian style espresso beverages, a variety of pastries and confections, and coffee-related accessories and equipment, primarily through its company-operated retail stores. On its Web site, Starbucks runs a simple, easy-to-use store that sells coffee beans, mugs, brewing machines and not much else.
Starbucks also provide high-speed wireless Internet connections in its stores. It now offers wireless broadband Internet service throughout North America, offering T-Mobile HotSpot in the U.S. and Bell Hotspot in Canada.
Music was a natural evolution in Starbucks as it had been playing music in the stores for almost 30 years. In 2004, Starbucks barista-in-chief Howard Schultz made a big push into music business, aiming to transform the record industry. It took innovative action to connect quality music to the Starbucks Experience by launching a revolutionary in-store CD burning service at the Starbucks Hear Music™ Coffeehouse in Santa Monica, California. With this innovative service, Starbucks customers can create personalized CD compilations and burn full-length albums from a vast digital library of songs. This service is currently available in selected location in Seattle and Austin.
Starbucks executives hesitate to put their strategic overhaul into a broader context. Can Schultz and his team carry off a transformation like this? Is it really a smart move for a coffee company like Starbucks to re-imagine itself as a lifestyle-entertainment enterprise and to start by serving up music? This paper addresses this problem by using SWOT analysis, Porter’s five forces model and value...
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