In response to Panos Mourdoukoutas’s Forbes blog post titled “Is Starbucks Losing Its Coolness?” I would like to offer my alternative, yet similar, viewpoint of competition. Mr. Mourdoukoutas outlines Starbucks’s original business plan, to be an “affordable luxury” coffee that would differentiate it from competitors such as “McDonald’s and Dunkin Donuts.” In recent years, however, Starbucks has seemingly lost its edge with fluctuating stock prices as well as changing customer segments to “families and young children.” I believe that this is an issue of competition.
Starbucks No Longer in the Lead?
Recent years have been met with a ‘boom’ of many coffee stores: Blenz, Waves, and Pacific Coffee Company, to name a few, that all operate under a fairly similar business plan compared to Starbucks. In particular, highlighting Blenz Coffee, many products found in this rapidly popularizing Canadian coffee store are pricier and often ‘tastier’ than many Starbucks products – it is no surprise that Starbucks has begun to lose ground when met with all these strong competitors. With companies such as McDonald’s, which has begun to target a more luxurious sector, with the introduction of McCafe, Starbucks has shown no disappointment with their change in business plans to targeting a more diversely aged customer segment, as outlined by Mr. Mourdoukoutas. While facing formidable competitors, I believe that Starbucks’s widespread reputation may still allow the company to thrive if Starbucks can continue to modify their strategies to conform to changing tastes and situations.
http://www.forbes.com/sites/panosmourdoukoutas/2014/11/01/is-starbucks-losing-its-coolness/