A comparative marketing strategy analysis between Starbucks and Caffe Nero

Starbucks presents itself as a high quality coffee for the upper class and is priced slightly higher than Caffe Nero’s coffee. It stays true to its American originality and stands out uniquely in its wide range of coffee drinks with such just some snacks and desserts. Other than that, Starbucks stands apart from other cafes by providing a very comfortable environment with facilities like Wi-Fi so that their customers can enjoy surfing the web while having their coffee.

On the other hand, Caffe Nero emphasizes its Italian mix and presents itself not only as a coffee shop but also as a bar and restaurant. It has quite an extensive menu with a variety of popular Italian dishes. Because of this, many people visit Caffe Nero for a meal rather than just a cup of coffee. They have brought a pure European vibe to their cafes while staying true to their originality. For the convenience of their customers and to add to their appeal they have also launched loyalty cards.

MARKETING STRATEGY:

Marketing strategies help businesses promote their products and services the way they want. While building on your biggest selling points, they try to create an image of your brand in the minds of your target customers in order to achieve your target sales and favorable market share. Marketing strategies help companies gain a competitive advantage by catering to those specific niches that others fail to identify. Marketing strategies designed by organizations vary in length, from one-year plans to plans that span many years. Many factors are taken into account when designing marketing plans and strategies that are defined by the environment in which the company operates. This is most often known as a SWOT (strengths, weaknesses, opportunities, threats) analysis which helps companies identify the areas they can take advantage of and the areas they need to be wary of.

The most important factor that any company must take into account when creating their marketing strategies is their competitors. The actions of competitors have a great impact on what an organization should do. In the coffee chain industry, there are now many independent coffee shops in the UK, such as the most popular Starbucks, Monmouth Coffee, Coffee Aroma, The Apple Tree, and Caffe Nero. In this assignment, the marketing strategies of Starbucks will be reviewed. and Caffe Nero, after which a critical analysis of both will be made.

STARBUCKS

The first Starbucks store opened in Seattle more than thirty years ago. Today, Starbucks stands proud at $4.1 billion with thousands of outlets not only in the United States but around the world. Many companies have studied the secrets and strategies adopted by Starbucks in an attempt to learn how Starbucks grew so fast. The marketing strategies that Starbucks is currently adopting will be analyzed in this paper (voteforus.com 2011).

unique marketing strategy:

The marketing strategy adopted by Starbucks remains unconventional. They did not adopt the common styles of advertising using billboards, newspaper ads, or television commercials. Rather they relate by word of mouth to promote their brand.

Product quality:

The most important thing that Starbucks never lost control of is the quality of its coffee beans. They were the first to introduce the true Italian “burnt espresso” flavor to Americans. They justify their high quality by charging a slightly higher price than most other coffees.

comfortable environment:

Another focus of Starbucks outlets is the atmosphere they provide in their cafes for their customers. Starbucks has always been touted as the perfect place to relax when you’re away from home and away from the office. They have started to offer Wi-Fi connectivity at their points of sale so that their customers can also surf the Internet while enjoying their cup of coffee.

customer satisfaction:

Customer satisfaction is Starbucks strongest asset. Every customer who walks into a Starbucks store receives such special treatment that he truly feels like he’s in a special place.

the starbucks community:

Starbucks has really taken full advantage of the latest social media craze. They have built their latest marketing strategies around social networking websites, such as creating fan pages on Facebook and Twitter, where they respond to all customers and stay in touch by posting photos, videos, and all the information. latest promotional information.

Innovation:

Starbucks has always kept their menu fresh by constantly creating new items and different blends and flavors in their coffee. Some of its latest successful beverages have been green tea with milk, considering health-conscious consumers, along with iced tea and frappuccino for its outlets in warmer climates.

brand marketing:

Starbucks has always presented itself as a high-quality product and therefore decided to rely solely on word of mouth promotion. This served to be quite a useful marketing strategy compared to promotional ads in magazines, newspapers, billboards, etc. They have recently started using social networking websites in the most effective way ever seen. Their Facebook and Twitter pages have proven very useful in promoting Starbucks’ image while allowing them to communicate directly with all of their customers on one platform.

BLACK COFFEE:

According to Caffe Nero chairman Gerry Ford (2008), Caffe Nero Group Ltd is “the UK’s largest independent coffee retailer, with over 400 UK stores”. It was founded in 1977 and today it has open outlets abroad, as well as in Turkey and the Middle East. They distinguish themselves from other cafes in the UK by emphasizing the fact that they are an Italian coffee company. Its main objective, in the words of Gerry Ford (2008), “is to provide a European-style coffee shop experience that offers premium espresso-based gourmet coffee, authentic Italian food products and a relaxed atmosphere in each store”.

Caffe Nero has received many awards for their high quality coffee over the years and for the outstanding experience they offer in their stores. Tatler called Caffe Nero ‘The best espresso this side of Milan’, while Egon Ronay called it ‘The traditional Italian coffee’. Caffe Nero has also been awarded the UK consumer label of “The UK’s Best Coffee Shop” for nine consecutive years (Allegra Report, the UK’s definitive guide to the coffee industry).

USP OF BLACK COFFEE:

Caffe Nero’s marketing strategy is mainly focused on its unique selling point, which is a purely Italian theme. Caffe Nero presents itself as more than just a coffee. Rather it has created a perfect combination of cafe, bar and restaurant. Therefore, Caffe Nero is not limited to just providing a place for coffee and snacks, but you can go there just to enjoy a meal. They have a wide range of exquisite desserts along with many Italian dishes such as Italian wraps, soups, sandwiches, pastas and paninis.

TARGET MARKET FOR CAFFE NERO

Caffe Nero caters mainly to tourists in the UK or Italians looking for their Italian taste in cooking. They are aimed at the middle-income group of middle-aged people, students or businessmen who prefer to go to a cafe during their lunch hour. In addition, Caffe Nero partnered with the famous House of Fraser retail chain, opening around 145 cafes, many of which were located inside House of Fraser stores (James, Situation Analysis of the Caffe Nero Group Ltd – Festive City

Critical analysis between the two companies

Now that a basic review has been given on the marketing strategies that both Starbucks and Caffe Nero are using, an analysis will be made on what differentiates them from each other.

• Caffe Nero and Starbucks are direct competitors, but Caffe Nero distinguishes itself from Starbucks by selling cheaper coffee than Starbucks.
• Caffe Nero offers a wider range of food items alongside its coffee drinks, setting it apart from Starbucks, which doesn’t have as wide a range of assortments.
• Caffe Nero adopts a strong brand positioning by emphasizing its European-style coffee shop compared to Starbucks, which is American in origin. Caffe Nero has a unique selling point that emphasizes the continental style of the cafes, while Starbucks is American style.
• Starbucks has successfully opened thousands of outlets abroad and in the international market, while Caffe Nero still lacks international experience and has just opened its stores in Turkey and the Middle East.
• Starbucks has many outlets across the UK, while Caffe Nero does not have enough outlets in central London.
• Caffe Nero has a lot of growth potential because it enjoys many unique selling points such as its pure European authenticity.

References

1. Ford, G (2008), ‘THE BEST ESPRESSO THIS SIDE OF MILAN’

2. Voteforus.com (March 29, 2011) Starbucks success is its word of mouth/social media/viral marketing strategy

3. James, S, Caffe Nero Group Ltd Situation Analysis – Festive City

4. VoteforUs.com Starbucks marketing strategy is not conventionally effective

5. Kembell, B, Hawks, M, Kembell, S, Perry, L, Olsen, L 2002, ‘Getting Starbucks Fever’, Missouri State University. Unpublished.

6. Rajul (2010), ‘Starbucks vs. Cafe Nero vs. Coast: who wins?’