Starbucks: Managing Customer Relationships One Cup at a Time

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Starbucks: Managing Customer Relationships One Cup at a Time

1.      Identify some of the ways that Starbucks ‘engages’ its consumers in customer relationships? (1 mark)

One of the ways through which Starbucks engages its customer is through social media. Social media is indeed taking center stage in people's lives, mainly because people can buy and sell without attending a physical shop through it. Through social media, Starbucks communicates about upcoming events and notifying customers about changes that may affect their tastes and preferences over the products Starbucks deal in. The case study revealed that Starbucks has over 50 million followers on its main social media platforms such as Facebook, YouTube, Google+, as well as Instagram.

The second way that Starbucks engages with its customer is through the “MyStarbucksIdea.com” site. This is a very innovative approach of allowing people to share beyond the modernity of social media. Through MyStarbucksIdea.com, Starbucks can be assured of gathering very reliable contributions regarding recommendations that its customer may be interested in.

2.      How can an understanding of digital marketing and social media strategies helped companies gain a competitive advantage and choose a right decision when it comes to customer relationship management? (1 mark)

There are two ways through with a company can benefit as a result of understanding digital and social media marketing. The first is through cost reduction. One key aspect of gaining a competitive advantage is to be able to produce products and services at a lower cost compared to rivals in the same industry. Through social media, Starbucks does not encounter any publishing cost of any materials related to availing information to its target population.

The second way through which Starbucks can create a competitive advantage by understanding the digital marketing landscape is by boosting its brand popularity. It is possible to filter marketing information to reach a specific target population in the current marketing platform. This way, the brand becomes popular among the people that the business wants to sell to. Additionally, gaining a competitive advantage depends on the ability of a business to create a focus strategy that customizes information and products to a particular target population. For example, Starbucks seems to focus primarily on young-middle income earners as well as tech savvies who are always on social media.

3.      Analyze the methods used by Starbucks and explain how the company has been successful in increasing its brand recognition in order to improving its customer relationship management. (1.5 marks)

Starbuck uses a customer-oriented approach as a way of...