Product Development Strategy of Starbucks. Why is the name Starbucks so famous to all ages? In this article, we will know Starbucks ‘ strategy for Product Development. And how each strategy works that makes Starbucks popular.
A short history about Starbucks
The first Starbucks Coffee opened in Seattle, Washington. In 1971, Starbucks was founded by the name Starbucks Coffee House.
Then, in 1987, Starbucks has begun to sell coffee in whole bean and ground form. In 1990, Starbucks ‘ expansion had begun to U.A.E, Canada, and East Asia (Japan). And in 1999, Japan had been accepted as a member of the international chain of Starbucks stores.
In 2000, Starbucks has become a multinational company. And in 2003 it had its initial public offering and is listed on the NASDAQ stock exchange. In 2008, the first Starbucks Reserve Roastery & Tasting Room has opened in Seattle. And in 2009, the second roastery was opened in Shanghai China.
1)Product Development Strategy
5)Employee Development Strategy
Now, we will go through each of the strategies and learn how each works. In this post, only the first strategy is discussed.
Product Development Strategy
Starbucks is a company that needs to develop products that can be sold in its coffeehouses. By following the product development strategy, Starbucks can provide its customers with new products and improve the taste of the product.
As we know, Starbucks is a coffeehouse where people come to drink coffee, tea, and snacks. So it has to develop new products and services for its customers, especially for special requests such as non-coffee lovers. Starbucks, develop its own product and also get them from other suppliers. This means they have to do product development by themselves or get it from other suppliers.
Starbucks has its own development strategy which is called the “Create new products”. They create a lot of new products by themselves such as Frappuccino in 1994, Verismo system in 2008, and Nitro Cold Brew (Nitro Coffee) in 2015. And they also get some products from other suppliers such as Clover machine in 2004.
Further, they don’t only create new products but also improve the taste of the existing products such as by reducing the acidity of their espresso or using different types of milk for milk-based drinks such as latte or cappuccino.
Product Development Strategy of Starbucks
For example, in 2016 Starbucks has developed a new way to make their espresso drink which does not need milk powder anymore. It means that if you want a latte with milk then you just need to add milk whereas before you needed both milk powder and milk because without milk powder it would be hard to pour a latte out from a machine like a latte maker.
So this kind of development makes Starbucks more convenient for customers who don’t like to use milk powder because they usually put too much or too little milk powder in the drink while they are trying to pour a latte out from a machine like a latte maker.
Moreover, this kind of development helps Starbucks lessen the cost since they don’t need to buy milk powder anymore since now all their espresso drinks are served with just fresh milk instead of fresh milk mixed with powdered milk.
Read on to the next article to know the whole Starbucks Strategy.