According to the Forbes magazine, Starbucks is going through a transition in its customer segment and value proposition. Starbucks used to be known as the “third place” offering surrounding that allows individual to be separated from their usual atmosphere like home and work place and enjoy affordable luxury. However this has been changing recently as Starbucks have been expanding its client base to different type of client segments and by satisfying some factors mentioned in the article that promote the transition. It is becoming the “first place” from its current “third place” for many customers.
Article mentions that company has been running successfully so far, however by pushing this agenda too drastically, Starbucks’ current value proposition may no longer hold true for some clients and hence may push away its loyal customers.
Retail giant like Starbucks must constantly evolve in accordance to client needs and simultaneously build a strong business model to increase revenue, profit and share price. For this, the company may need to take a “creative” and “realistic” approach by offering conflicting value propositions at the same time for clients with different needs. Once observation is made, analysis is done and conclusion is drawn, company can focus its attention, strategy and resource at that time to evolve again.