Minor Project Report

On

“A Study on Importance of Customer loyalty and

Brand Image for Starbucks Pvt Ltd”
Submitted in Partial Fulfillment of the requirement for the
Award of the Degree of
Bachelor of Business Administration (General)
Submitted By:
Student Name – Harshita Gupta
Class - BBA (General) Section A
Enrollment No. 05121201720

Submitted to - Faculty - Dr. Anshu Lochab Ma’am

Batch: 2020 – 2023

DEPARTMENT OF BUSINESS ADMINISTRATION Maharaja
Surajmal Institute Recognized by UGC U/S 2(f), NAAC Accredited
‘A’ Grade
Affiliated to Guru Gobind Singh Indraprastha University, Delhi
C - 4, Janakpuri, New Delhi - 110058

1
 Certificate
This is to certify that Project Report entitled “A study on customer
loyalty and brand image for Starbucks Pvt Ltd” which is submitted by
Harshita Gupta in partial fulfillment of the requirement for the award
of degree Bachelor in Business Administration/ Bachelor in Business
Administration (Banking and Insurance) to Maharaja Surajmal Institute
Affiliated to Guru Gobind Singh Indraprastha University, C-4,
Janakpuri, New Delhi-110058 is a record of the candidate own work
carried out by him under my supervision. The matter embodied in this
report is original and has not been submitted for the award of any
other degree.

Signature of the Guide

Name of the Guide:

Designation

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 Declaration
I, Mr./Ms. Harshita Gupta, Roll No. 05121201720 certify that the Minor
Project Report (Paper Code : BBA-311) entitled “A study on
importance of customer loyalty and brand image for Starbucks Pvt Ltd” is
done by me and it is an authentic work carried out by me. The
matter embodied in this has not been submitted earlier for the award
of any degree or diploma to the best of my knowledge and belief.

Signature of the Student

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 Acknowledgement
I would like to express my special thanks of gratitude to my teacher Dr Anshu
Lochab as well as my college Maharaja Surajmal Institute for giving me the
golden opportunity to do this wonderful project on the topic A Study on
Importance of Customer Satisfaction and Brand Loyalty for Starbucks Pvt.
Ltd. which also helped me in doing a lot of Research and I came to know about
so many new things. I am really thankful to them.

Secondly, I would also like to thank my parents and friends who helped me a lot
in finalizing this project within the limited time frame.

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 INDEX
SNO Contents Page No
1 Title Page
2 Certificate from College
3 Declaration
4 Acknowledgment
5 Table of Contents
6 Executive Summary
7 Chapter-1 Introduction
8 Chapter-2 Profile of the
organization
9 Chapter-3 Conceptual
Framework
10 Chapter-4 Analysis and
Interpretation of Data
11 Chapter-5 Conclusions
and Recommendations
12 Bibliography
13 Appendix

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 EXECUTIVE SUMMARY

Brand loyalty is when a consumer prefers to buy the same brand of goods rather than
competing brands. Brand loyalty is important to the bottom line because it can increase
sales volume by retaining consumers using the brand and by allowing premium pricing.
In other words, customers find brands have value, and when that is found, 1) those
consumers become repeat buyers and 2) are price insensitive. From a business
perspective, building and increasing brand loyalty results in continuous profits due to
long-term repeat customers, less reliance on marketing to boost client base and premium
pricing. Starbucks is known to have a relatively higher loyalty level among consumers in
the coffee shop industry This study focuses on the brand image, experience, quality, and
services offered by Starbucks that will bring customer loyalty from customer satisfaction.
The study analyses how customer loyalty and brand experience affect the quality
improvements of Starbucks coffee as corporate brands plays a vital role in achieving
higher company’s performance like sales. It makes more incentives to satisfy the
potential customers and develops a drawn-out relationship with them. This study
concludes that companies with higher customer loyalty and satisfaction tend to have
higher market share, and move further by cost reduction. Therefore, companies could
substantially pay attention to all these variables to have an everlasting profitability as this
will lead to gain competitive advantage.

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 CHAPTER-1

INTRODUCTION

Brands have become emblems and symbols which embody beliefs, values, personality
and innovation. They stir up memories and emotions that represent quality. Therefore,
brands are considered as a crucial part for the firm’s success as they become the major
source of differentiation between other competitive offerings in the market Nowadays,
Building and developing correctly managing brand equity has become essential for most
companies. Therefore, most of the companies have realized that brand equity is one of
their most valuable intangible assets. Moreover, retaining and enhancing the strength of
the company’s brand has become important management requirement Loyal customers
are the most important asset to any business, hence, Coffee house managers have to
interconnect and communicate in the most effective way with customers and be highly
responsive when they dealing with their grievances, as loyal customers will not only
repeat the purchases, but also they bring their friends and family with them).
Nevertheless, any company needs loyal customers to their brand because they are
unwilling to shift to other brands, which allows the company to survive and grow in the
competition. Given the situation, the rise of competition in Jordanian coffee companies
particularly in the specialty coffee products, maintaining on customer loyalty is becoming
a hard mission for the companies since the fluctuations of the customer behavior based on
the branding, value, and price. In order to cope with this situation, Starbucks chain in
Jordan must identify the relationship between brand equity and customer loyalty so that
their products will not be affected by the other competitors.

Brand loyalty results in repeat purchasing and positive word of mouth. When consumers
consistently purchase a certain brand and have positive experiences, the company owning
that brand achieves competitive advantage. Companies want to foster brand loyalty
because consumers affect a brand’s success. Brand loyalty is the bottom line for
companies because repeat purchasing leads to higher sales volume that helps the

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company grow. When a product is deemed to have value, consumers are less price
conscious regarding the brand. When consumers are brand loyal, the cost of an item is
not as important. Consumers will find a brand they prefer, will not focus on price, nor
will pay attention to other promotions that the competition is advertising. Therefore, one
of the goals of a brand has become to ultimately create higher brand loyalty. By
minimizing the number of consumers that are leaving the brand and increasing the
number of consumers purchasing from the brand, companies can increase volume of
sales. Unfortunately, companies tend to lose around 13% of their consumers every 5
years. Because consumers can lose interest in the brand, companies can suffer. “It costs
about 5-10 times more to find a new customer than to keep your existing one. Loyal
customers know exactly what they want when purchasing from your brand and tend to
spend more as well. Current customers tend to spend 67% more than new customers” . In
a retail study, loyal customers reflect about 12-15% of the total amount of purchasers,
which still accounts for 55-70% of those sales . Put simply, this means over half of your
current business is likely coming from a 1 small percentage of your total customers, and
those customers are making loyal purchases on a regular basis. When losing consumers,
it is hard for companies to make up that loss, therefore companies would like to follow
the retain rather than seek strategy (Giddens, 2010). Retain rather than seek affects a
company’s bottom line

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Starbucks Corporation is an American coffee house. Its headquarter is in Seattle,
Washington. Starbucks Coffee aims to operate in different countries and reach over 70
Countries in the early 2020. Generally, Starbucks Coffee serves hot and cold drinks,
Pastries, and snacks in their stores.
Zev Sigel, Jerry Baldwin, and Gordon Bower are the founders of Starbucks coffee. In
In the 1980s, Howard Schultz owned the coffee shop after he went to Milan. There were
More franchises opened by Schultz in the United States. Recently, coffee exists as an
Important elements of people’s daily life. We all can freely go to coffee shops to enjoy
Some coffee and desserts. We could also socialize and interact with other people in the
coffee shops.
Starbucks Coffee is the largest international coffeehouse chain with more than 30,000
Stores across the world. It decided to expand their business in India in 2011. Hence, they
Collaborated with a local company, Tata Global Beverage, to compete with other coffee
shops in India. They were both under a 50:50 joint management and became “Tata
Starbucks
Private Limited”. In India, they named it “Starbucks Coffee Tata Alliance”. The
First Starbucks Coffee shop in India was opened on 19 October 2012, located in a
twolevels
store in Mumbai. Over the years, they expanded their business and opened more
Stores across India. There have been about 191 Starbucks Coffee stores in India until
The year 2020.

Starbucks decided to enter India’s market since they were seeking a new market. India
Has the second largest population in the world with a high development market. The
“Starbucks Coffee Tata Alliance” also focuses on customer preferences by modifying
their menu and adding in some local flavors to the products they sell to boost their sales.
For instance, they launched local foods such as cottage cheese rolls and chicken tike
Panini in their stores to attract more customers. The coffee beans they used are also
Sourced in India.
Starbucks is the biggest coffee company in the world providing unique and exclusive
experience through their services and products to their customers. Its premium quality

9
coffee helps it to position itself in the market. For example, “Tazo Tea” was introduced in
India specially attracts tea lovers. Starbucks Coffee monitors the production step by
step from to ensure its good quality. Furthermore, clear mission and objectives are
provided to their employees to encourage their collaborative work to achieve goals.
All efforts to increase customer loyalty and satisfaction create a strong customer base.
Premium services and products provided provide unique experience to customers and
They are willing to pay more for the enjoyment. Therefore, Starbucks uses value-based
pricing strategy, allowing them to earn more through good quality beverages and foods
along with great customer service. Jadedly the following PESTLE analysis could bring
another insight about strategies to devise.
Firstly, the political features of Starbucks. Politics is about acquiring resources as it gets
more political attention from the west and in other resource countries. The political
stability in the country must be one of the considerations of the organization. Secondly,
The economic features of Starbucks. The global economic downturn is Starbucks' main
foreign economic campaign. The company is facing the rising costs of labors and the
number of laborers. The decrease in net income and inflation has impacted Starbucks
directly from an economic aspect. The exchange rates of local currency, the environment
economic markets and the company tax rate build some pressure on Starbucks.
Thirdly, the social and cultural aspects of Starbucks. Starbucks has to make a trade-off
between offering products at a cheaper price or to maintain its high quality as the selling
point. Socio-cultural levels of human education in the local market could also affect
Starbucks as this factor will affect the choice of locals on purchasing products. The fourth
factor is Starbucks' technical features. Starbucks Coffee is a great place as consumers
are benefited from Starbucks technological convenience. Youngsters and working adults
may experience free and smooth networking in Starbucks coffee shops. It made a
strategic move by partnering with Apple through the distribution of discount coupons to
help it ride the wave easily. Starbucks also enables mobile payments for the company to
introduce Wi-Fi capabilities in its stores.
The fifth is the natural feature of Starbucks. Starbucks’ business will trouble the activists
and international legal teams. They also have an impact on environmental laws and

10
regulations, disasters in coffee-producing countries and other environmental emissions at
the
global level. Lastly is Starbucks legal feature. Companies want to work for the
public environment and contribute to compliance with government rules as Starbucks
imports consumer goods. The management of the company must not be against any
laws and rules in the business and trade markets. This PESTLE analysis is the evidence
that the external environment of the company is stable.

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OBJECTIVE OF THE STUDY

This study focused on brand image, customer loyalty, and customer satisfaction in
Starbucks Coffee in India. These aspects are believed to be the key for Starbucks Coffee
success in the highly competitive business markets. The basic marketing concept is to
provide customer satisfaction by fulfilling their needs and therefore their high satisfaction
increases the customer turnover rate and brings customer loyalty.

This study analyzes the impact of customer satisfaction and customer loyalty on
Starbucks coffee in India.

Thus, this study analyzes the relation among the brand image, customer satisfaction, and
customer loyalty and indicates the level of how they are associated.

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BRAND IMAGE
Brand image refers to customer’s perception towards a brand (Keller, 1993). It reflects
the perceptions of consumers and their feelings towards a specific good (Armstrong,
Kilter, & Opresnik, 2020, p. 250). Partially, it has a significant positive effect upon the
sales volume increase of SMEs products (Node & Hengelo, 2020). The brands and equity
a company is noble as it is hard to be copied. However, there might be differences
from one brand to another as the brand outlines the organization’s value (De Chernatony,
1999). the trade between consumers and company does not limit to the products as
It also represents the company’s value (In, 1997).

According to Armstrong et al (2020), customers form expectations about the product

offered in the market in terms of value and satisfaction. Therefore, customer satisfaction
is obtained when their expectation reaches what they have imagined. Customer
satisfaction will positively affect the organization through repeated purchase and brand
loyalty (Angel ova & Zaire, 2011).
brand experiences is categorized into four different aspects, including educational,
entertainment, escapist entertainment and esthetic. These aspects are related to
customer loyalty and the strong relationship between these two variables are proven.
customer’s good experience creates a strong brand image to the organization, leading
to customer loyalty. Customer loyalty deals with as brands, services, and store loyalty
and it is important for maintaining a code of conduct (Dick & Basu, 1994). Customer
loyalty also means the strategy that creates mutual or definite common rewards to benefit
companies and
customers in many aspects (Reichheld & Detrick, 2003). One of the benefits is that
companies could increase the revenue and sales of the product. It is clearly mentioned
that with loyal customers, companies can maximize or earn huge profits since loyal
customers are completely willing to earn or purchase more frequently, spend money on
trying new and innovative products or services and recommend the products and
services to others (Reichheld & Sasser, 1990). Thus, loyalty directly links to the success
and profitability of a company (Eakuru & Mat, 2008). Therefore, loyalty is a described
attitude-behavior relationship that allows integrated investigation as a result of customer

13
loyalty (Dick & Basu, 1994). Potential customers are those who can become the future
customers of an organization. According to Chen, Liu, & Chen (2016), potential
customers are searched and analyzed in specific market segments either through the real
world or internet. Identifying the correct potential customers and providing them with
services and products
that could meet their needs will help to create a brand value to them therefore making
satisfied with and loyal to the brand. Competitive advantage can be defined as the
benefits gained by a company when they have a large market position with less
competitors. To get competitive advantage, companies must ensure that they are working
something special and irreplaceable. Starbucks keeps their position in the international
market
by distinguishing their products with extremely good services and products. This makes
then create a quite valuable economy in the market.
Company Side Brand Image
The brand name of Starbucks has the power of influence to other people. The reasons are
like these. The coffee is a daily habit for many people and many people are affected by
Starbucks’s logo. It is possible to get more customers by using the brand name of
Starbucks. “Howard is the architect of the Starbucks brand and the visionary behind the
unique customer experience that is at the heart of this remarkable company’s success,”
said Craig Weatherup, chairman of the Starbucks, “we are recommitting ourselves to
what has made Starbucks and the Starbucks Experience so unique: ethically sourcing and
roasting the highest quality coffee in the world; the relentless focus on the customer; the
trust we have built with our people, and the entrepreneurial risk-taking, innovation and
creativity that are the hallmarks of our success.” Starbucks has so much to offer,
importantly its locations, consumers, brand image and a distribution network. Starbucks
is no longer just offering the functional benefit of coffee, but selling a lifestyle, allowing
consumers to trade up and feel their aspirations for a better life. Starbucks is not merely a
coffee store but rather a media property with an intrinsic value to brand partners.
Starbucks has developed an emotional attachment with its customers and restoring the
connections with its customers who have with Starbucks coffee, its brand, people and
with its stores. (www.starbucks.com) Starbucks’ passion for doing coffee business is that
14
it has complete focus on the customer and relationship with the customers.
(www.starbucks.com)In doing so, Starbucks will rely on the continued efforts and
dedication of its partners all around the world, who have and will continue to contribute
so much to the Starbucks success story. (www.starbucks.com)
Brand image and Brand loyalty

Brand image and brand loyalty have a cohesive relation, Without a sustainable brand
image, there is no brand loyalty. Establishing your products or services as a brand allows
the customers to remember the name or logo. So, next time when they have to buy from
the same manufacturer, they only need to write its name and browse relevant products.

Most of the eCommerce website utilizes the popularity of brands by listing products from
the top producers and allowing customers to shop by brand. It enables them to gain
consumer trust and boost sales. Any online store can easily
incorporate navigational aid for searching and shopping products by its brands according
to the application they use.
Relationship between Brand Loyalty and Customer Satisfaction
One of the most important aspects to ensure the attention of the customers is to provide
the best and the most favorable products at this competing market. With customer
satisfaction comes customer loyalty. It is important to determine the relationship between
customer satisfaction and loyalty and the factors influencing these concepts. Further we
will get to know that how these concepts affect the relationship that customers have with
the organization that helps the organization to be at a better place in the market or beat
the competitors. A highly satisfied customer will spread positive WOM and a loyal
customer leads to an increase in both sales and profitability. Customer satisfaction affects
the trust and customer trust is an antecedent of loyalty. When customers connect with
emotions through the product/ services of the brand then it creates a bond between the
customer and the brand. The relationship between satisfaction and loyalty influences the
profits. The more customer is satisfied, the more loyal towards the brand. A loyal
customer leads to an increase in both sales and profitability. Customer satisfaction
mediates the relationship between customer loyalty and service quality.
15
Factors that affect brand loyalty

1. CONVENIENCE.

When buying consumer products, many loyal customers stray simply because the store
where they regularly buy your product ran out or doesn’t carry it anymore. They may still
prefer your product, but after all, there are other brands in stock and they don’t have time
to chase your product down.

2. EXPECTATIONS.

Your product must continue to live up to their expectations in every way. It not only has
to continue to deliver on its brand promise and remain relevant, but its price, value, and
availability must continue to be dependable.

3. CUSTOMER SERVICE.

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The way your company stands behind its products can be as valuable as the product itself.
A good warranty and swift resolution of issues keep customers, who may have had a
disappointing experience, buying your product.

4. PERSONAL RELATIONSHIPS.

The way customers are treated by third parties, such as salespersons, store clerks, or your
own representatives can make or break customer loyalty. Many don’t buy your product so
much as they “buy” the person who sold it to them.

5. REWARDS.

Customers want some consideration for continuing to do business with you, especially
when they have other options. Offering savings, bonuses, and other forms of special
attention to your loyal customers can not only keep them from going elsewhere but may
be the reason they recommend you to their friends.

6. REPUTATION.

How your product plays in the media, both commercial and social, can influence long-
term relationships. Your companies financial, labor, and sourcing practices are now
subject to the scrutiny of an increasingly transparent world where consumers realize that
they vote with their purchases.
7. COMMUNITY OUTREACH.

When you stand for something beyond your product, when you support the causes
important to your customers, and when you participate in their community, you build a
bond of loyalty that is hard to break. This gives them a social reason to become and
remain loyal.

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ONLINE PRESENCE OF STARBUCKS

When it comes to social media customer service, Starbucks truly shines. In fact, the
coffee giant has a pretty impressive record of responding to customers on Facebook,
Twitter, and Instagram.

In 2017 alone, Starbucks responded to more than 5 million posts on its various social
media platforms—an average of more than 18,000 posts per day! Compared with other
brands that post to social media regularly, Starbucks appears to be one of the most
responsive brands on the market.

As of 2022, Starbucks has 36M+ likes on Facebook, 17M+ followers on Instagram,

11M+ followers on Twitter, and 360K+ subscribers on YouTube.

In addition to its responsiveness on social media, Starbucks also performs well in overall
customer service performance. There’s no doubt that Starbucks is committed to the idea
of “coffee as a community,” but it needs to consistently show customers that it’s putting
this philosophy into action for them to believe it honestly.

Nonetheless, you won’t have to worry about being “mad” at Starbucks for too long. While
their posts are comedic too in the slightest ways, they don’t shy away from answering
concerned and frustrated customers. In their “About” section on Facebook, it says that
Starbucks “typically replies within an hour”; however, it is already very likely that
they’ve addressed a common issue on http://mystarbucksidea.force.com/apex/ideaHome.
(This is also where you can go to share ideas and comment on others; make your voice
heard! At the time of writing, there are 48,000 coffee & espresso ideas, 25,141 for food,
and 11,898 for merchandise & music, which is pretty cool.) And even so, their replies in
comment section are very genuine and encouraging, prompting individuals to return.
Similar to how you would reach out to a friend, Starbucks is there for you.

Obtaining customers is great, but retaining them is even better. When dealing with a
company as large as Starbucks, it can be frustrating getting their attention; however,
Starbucks values every single person and doesn’t take success for granted. As evident
18
through the social media campaigns, there is a mutual understanding between the two
parties because coffee is something worth enjoying. It’s a routine story that can be told
over and over again, and, yet, it’s made interesting and creative from a business that cares.
Rather than slapping advertisements on Facebook, take note and create meaning for your
followers. (Take it from a company that actually has social media accounts for individual
drinks. cc: Pumpkin Spice Latte, Frappuccino)

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Relationship between customer satisfaction and loyalty

One of the most important aspects to ensure the attention of the customers is to provide
the best and the most favourable products at this competing market. With customer
satisfaction comes customer loyalty. The topic for this review article is to determine the
relationship between customer satisfaction and loyalty and the factors influencing these
concepts. Further we will get to know that how these concepts affect the relationship that
customers have with the organization that helps the organization to be at a better place in
the market or beat the competitors. A highly satisfied customer will spread positive
WOM and a loyal customer leads to an increase in both sales and profitability. Customer
satisfaction affects the trust and customer trust is an antecedent of loyalty. When
customers connect with emotions through the product/ services of the brand then it
creates a bond between the customer and the brand. The relationship between satisfaction
and loyalty influences the profits. The more customer is satisfied, the more loyal towards
the brand. A loyal customer leads to an increase in both sales and profitability. Customer
satisfaction mediates the relationship between customer loyalty and service quality.

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LITERATURE REVIEW

Brand Image
Many people have studied the best way to shape Starbucks' brand image. They used were
various indicators and benchmarks were implied to their studies. The research on
Starbucks
brand image generally involves the following aspects: the definition of Starbucks brand
image, how Starbucks brand image plays a role, how Starbucks brand image is
established,
and so on. Previous scholars defined brand image as "visual elements before the verbal
elements. " Pictures in advertising are useful as attention grabbers. Brand image is a kind
of "Visual element" [3]. The author advocates that visual elements precede language
elements, and pictures are helpful tools to attract attention in advertising. There is a
positive correlation between the word of mouth and consumers' purchase intention. Brand
image mediates the relationship between word of mouth and consumers' purchase
intention toa certain extent, that is, word of mouth, which will be discussed in the latter
content, and brand image jointly affects purchase intention [4]. Different people also have
different opinions on how to play the role of their brand image. Some people think that
brand image is a medium in which other factors affect purchase intention, acting as an
intermediary, and other factors and brand image jointly affect purchase intention; others
think that brand image is expressed through brand association. The preference, power,
and uniqueness are understood in the eyes of consumers —for example, the citation: a
computational model to estimate brand image from online consumer reviews. Brand
image is consolidated in consumers' minds through popularity,
strength, and unity of brand associations.
Another citation states a view like this concept: blending package shape with the gender
dimension of brand image: how and why? Although people have a different
understanding of
brand image, some think it is a kind of media, and others think it is synonymous with
mass

21
media advertising. S, such as citations, offers many, and marketing is synonymous with
mass media advertising, which can be a powerful tool. Brand image is built by these
tools Some people believe that it directly affects purchase intention, others believe it
indirectly affects purchase intention, and others believe it influences consumers' purchase
intention with other factors. These measurements depend on different sample types and
theoretical models in before people find the most appropriate and scientific method, they
all use different personal methods to study Starbucks' brand image from different
dimensions.
Word of Mouth (WOM)
Many people have expressed different opinions on Starbucks' brand reputation research.
They used various indicators and benchmarks but did not include customers' word of
mouth. The research on Starbucks brand word-of-mouth generally involves the following
aspects: the definition of word-of-mouth, the types of Starbucks word-of-mouth play
different roles in the customer search process, how word-of-mouth plays a role, how
Starbucks word-of-mouth is regarded as an important indicator, and word-of-mouth is
used as the basis for investigation and a method to investigate the symmetrical
competition between retailers, and the role of word-of-mouth communication to others.
Previous scholars defined brand word of mouth as "For customers, online word of mouth
is what they refer to when purchasing a product" [7].
Subsequent studies have shown that word-of-mouth types play different roles in customer
search (e.g., A process-related analysis also recommends differentiated parts of WOM
types during consumers' search procedure, such that face-to-face communication and
online idea sites tend to be consulted early, whereas social media are primarily regarded
as final information sources). Overall, the findings warn against if the various WOM
types are arbitrary or random substitutions [8]. Word of mouth (WOM) has become an
essential indicator for influencing customer behavior and developing marketing
strategies.
In addition, other studies have shown that word of mouth is used as a basis for
investigation and a method to investigate the symmetrical competition between retailers.
Using word of mouth data explores what (a) symmetric competition is among retailers.

22
Customer Satisfaction
A large amount of literature has already looked deeply into consumer satisfaction in the
past decades by many people specializing in business. At the end of the 20th century,
attention was more focused on its effect on loyalty and purchasing intentions [10, 11]. In
1994, nderson, Fornell, and Lehmann proposed that consumer satisfaction, or customer
satisfaction, is an essential concept and a relevant KPI of all business activities [10]. They
also pointed out that consumer satisfaction is tied up with many aspects, including
customer loyalty. However, four years later, in 1998, Andreassen and Lindestad studied
complex service areas and claimed that brand image has more effect on customer loyalty
than customer satisfaction [11]. Even though the relationship between customer
satisfaction and loyalty is blurred, researchers still emphasized the importance of this
figure. By 2001, Chan and many other Hong Kong scholars summarized that consumer
satisfaction is the best index for the company to measure and predict profits, given that it
is related to financial return and productivity [12]. Consumer satisfaction is also believed
to affect purchasing patterns. Cho and Park proposed evaluating satisfaction through
electronic commerce user-consumer satisfaction index (ECUSI) to study customers'
purchasing intention, which turns out to be highly relevant [13]. In the food retailing
industry, which is like us target beverage industry to a certain degree, Calvo-Portal and
Levy-Mangin illustrated the relationship between purchase frequency and consumer
satisfaction [14]. The The authors related that the offline shopping experience creates
consumer satisfaction in this paper. They believed that many tangible and intangible
elements such as quality and service
are linked to better satisfaction.
CONCLUSION
In the end it is noticed that brand equity is what allows company to earn a better volume
or bigger margins than it would be possible without the brand name. On the other hand,
loyalty is the ultimate and superior goal of any brand for the reason that brands basically
are about repeat the purchases process and making loyal customers -fans who promote
your brand for free. Therefore, to establish loyalty you must take care of brand as a
personality, because if any business aim to get loyal customers they need connections or
relationships and relationships can only exist between two personalities. Moreover, the

23
basic idea behind this relationship is that brands need loyal customers for only they can
carry brand over the chasm from “early adopters” to “early majority”. Brand by itself
cannot do that because of diversity of the factors which are (expenses, inability to transfer
emotions and need for endorsement

24
 RESEARCH METHODOLOGY

The study will be conducted to achieve the objectives including both exploratory
and descriptive in nature and involve personal interviews that will be based on
the questionnaire format. A Research Methodology defines the purpose of the
research, how it proceeds, how to measure progress and what constitute success
with respect to the objectives determined for carrying out the research study.
There is a unique methodology that Ifortis Worldwide adopts to render the
service.

 The research methodology for the present study has been adopted to reflect
these realties and help reach the logical conclusion in an objective and
scientific manner.

RESEARCH OBJECTIVES

The primary objective is to study, understand and analyze aspects related to

factors impacting customer loyalty and brand image of Starbucks India

TYPE OF RESEARCH

EXPLORATORY RESEARCH

A research design is the specification of methods and procedures for acquiring the
information needed to structure or solve the problem. It is the overall operational
pattern or framework of the project that stimulates what information is to be
collected from which source and by what procedure. On the basis of major
purpose of our investigation the EXPLORATORY RESEARCH was found to be
most suitable. This kind of research has the primary objective of development of

25
insights into the problem. It studies the main area where the problem lies and
also tries to evaluate some appropriate courses of action.

DATA COLLECTION

The task of data collection begins after a research problem has been identified
and the research design has been chalked out. While deciding the method of data
collection to be used for the study, the researcher should keep in mind two types
of data:
a. Primary data
b. Secondary data

In this research project the data being collected is as follows:

Primary Data: The survey method is used to collect the primary data in this
research as it is the Analytical research to find out the shortcomings and area of
improvements according to the skill required for recruitment team. The data that
is collected first hand by someone specifically for the purpose of facilitating the
study is known as primary data. So in this research the data is collected from
respondents through QUESTIONNAIRE.

 Primary source of data

(1). Personal interview

(2). Questionnaire technique.

QUESTIONNAIRE - Survey among the customers of Starbucks

PERSONAL INTERVIEWS with the company representatives regarding
recruitment and selection practices in organization.

26
Secondary Data:
The secondary data is also used in a lesser proportion to find out the name and
designation of the employer who are working with this organization and the
company profile. Secondary data refer to information gathered by someone other
than the researcher conducting the current study. Such data can be internal or
external to the organization and accessed through the Internet or perusal of
recorded or published information.
Secondary sources of data provide a lot of information for research and problem
solving. Such data are as we have seen mostly qualitative in nature.

 Secondary source of data

(1). Company brochure.

(2). Internet.

(3). Websites

(4). Organizational reports & Records.

(5). Business magazines

(6). Journals

Research Methods Used

Primary data has been used for this study

SAMPLING TECHNIQUE

SIMPLE SAMPLING

Simple sampling is a sampling process that utilizes some form of random

selection. In probability sampling, each unit is drawn with known probability, or
has a nonzero chance of being selected in the sample. Such samples are usually
27
selected with the help of random numbers. With probability sampling, a measure
of sampling variation can be obtained objectively from the sample itself. Simple
Random sampling has been adopted for this research. Under which we have
considered the sampling which has been done for a specific designated population,
because here a small cluster of professionals has been considered out of the total
universe which has been divided in small group like recruitment team &
employee.

SAMPLE SIZE

Sample size refers to the number of items to be selected from universe to

constitute a sample. The sample size should be optimum as it should fulfill the
objective of the research.

SAMPLE AREA

The sample area refers to the universe to be studied under our research project.
The area denotes the place or the region to be studied and taken into research
consideration. Thus, the sample area chosen for this research project is Ifortis
Worldwide

This research was carried out by various data collection techniques or methods. Mainly,
the techniques were filling out questionnaires, documentation studies, charts, and
tables. A questionnaire was more preferred since it is considered as a more structured
technique to collect data consisting of a series of multiple questions that can be
answered by the respondents easily. Questionnaires which are also considered as an
interview format, can be illustrated as measurement of an instrument containing multiple
questions to obtain various information from respondents. The population in this study
completely include consumers who make purchases at Starbucks Coffee who are
strongly or likely keen towards consuming Starbucks coffee.
The major reason behind choosing a questionnaire is due to its high level of assurance
of the validity and credibility aspects embedded through the collected database on it as

28
it insistently focuses on thinking about the instruments of the questionnaire that best
suits this survey and research. The main reason behind this stops on one of the most
valuable attributes of having no biasness or partiality. However, it is probably impossible
to achieve a particular goal of no-biases by some different research paths, like focused
group discussion and interview method etc. It can cause the visual clues
expressed by guided researchers and that would affect and guide the attitude
of respondents more and less.
Primary data is considered as one of the pure methods of collecting data. In this study,
the researchers gathered and obtained data through distributed questionnaires to the
respondents. The results obtained from questionnaires were analyzed to find out the
exact views and true opinions of the customers regarding their satisfaction, brand
experience and service quality affecting their loyalty. This study collected the primary
data through information from questionnaires filled in by 105 respondents.
The primary data of this research was collected from surveys on loyal customers of
Starbucks Coffee. In this questionnaire, there are qualitative and quantitative questions
created for the respondents to fill in There is also an open-ended question asking about
their opinion and suggestion which require critical thinking skills of the respondents.

29
SCOPE OF THE STUDY

This study focuses on Starbucks customer loyalty. Starbucks is an enormous corporation

and brand that many consumers are loyal to. Highlighting these prominent attributes will
allow small businesses to thrive in creating loyal customers for themselves.

This study will focus on delivering the best suggestion a small business can incorporate
based on Starbucks reviews, in order to grow their business and profits.

Comparing Starbucks uplifting factors will allow new findings to be brought to light that
can be future implications to smaller businesses. Highlighting these attributes will help
better understand the success of Starbucks business ventures.

30
LIMITATIONS OF THE STUDY

The studies mentioned above outlined the effect of brand image and consumer
satisfaction is related to purchasing intention and frequency. Also, word of mouth could
be regarded as a reflection of customer loyalty. These studies pointed out the significant
relationship between brands and customers on these three levels, focusing on either
purchasing experience or brand loyalty. According to the results, stressing these three
aspects is essential to company profits
in brand management. However, the inter-relationship between these three terms is yet to
be discussed in papers. Consumer satisfaction, an important proven index for brand
profits prediction, is not widely discussed associated with neither brand image nor
customer comments (word of mouth). Besides, as social media platforms advanced in
recent years, attention should be paid to improve consumer satisfaction through a brand's
online image and studies on word of mouth.

31
 CHAPTER-2
PROFILE OF THE ORGANISATION

Our story began in 1971. Back then we were a roaster and retailer of whole bean and
ground coffee, tea and spices with a single store in Seattle’s Pike Place Market. Today,
we are privileged to connect with millions of customers every day in more than 80
markets.

FOLKLORE
Starbucks is named after the first mate in Herman Melville’s “Moby-Dick.” Our logo is
also
inspired by the sea – featuring a twin-tailed siren from Greek mythology.
STARBUCKS MISSION
Our mission: to inspire and nurture the human spirit – one person, one cup and one
neighborhood at a time.
OUR COFFEE
32
We have always believed in serving the finest coffee possible. It's our goal for all our
coffee to
be grown under the highest standards of quality, using ethical sourcing practices. Our
coffee
buyers personally travel to coffee farms in Latin America, Africa and Asia to select
high-quality Arabica beans. And our master roasters bring out the balance and rich
flavour of
the beans through the signature Starbucks® Roast.
OUR STORES
Our stores are a neighborhood gathering place for meeting friends and family. Our
customers enjoy quality service, an inviting atmosphere and an exceptional beverage in
our
stores and immersive Starbucks Reserve® Roastery locations in Chicago, Milan, New
York,
Seattle, Shanghai, and Tokyo.
34,000+ STORES IN 84 MARKETS
Andorra, Argentina, Aruba, Australia, Austria, Azerbaijan, Bahamas, Bahrain, Barbados,
Belgium, Bolivia, Brazil, Brunei, Bulgaria, Cambodia, Canada, Cayman Islands, Chile,
China, Colombia, Costa Rica, Curacao, Cyprus, Czech Republic, Denmark, Dominican
Republic, Egypt, El Salvador, Finland, France, Germany, Greece, Guatemala, Hong
Kong/Macau, Hungary, India, Indonesia, Ireland, Italy, Japan, Jamaica, Jordan,
Kazakhstan,
Kuwait, Lebanon, Luxembourg, Malaysia, Malta, Mexico, Monaco,
Morocco,Netherlands,
New Zealand, Norway, Oman,
Panama, Peru, Philippines, Poland, Portugal, Puerto Rico, Qatar,Romania, Russia, Saudi
Arabia, Serbia, Singapore, Slovakia, South Africa, South Korea, Spain, Sweden,
Switzerland,
Taiwan, Thailand, Trinidad and Tobago, Turks and Caicos,Turkey, United Arab
Emirates,
United Kingdom, United States, Uruguay and

33
Vietnam.
OUR PARTNER
Our employees, who we call partners, are at the heart of the Starbucks Experience.
We offer comprehensive health coverage for eligible full- and part-time partners; equity
in the
company through Bean Stock; and the opportunity for eligible U.S. partners to earn
bachelor’s degrees with full tuition reimbursement through the Starbucks College
Achievement Plan.
OUR PRODUCTS
Starbucks offers a range of exceptional products that customers enjoy in our stores, at
home, and on-the-go.

Coffee: More than 30 blends and single-origin premium coffees.

Handcrafted Beverages
Fresh-brewed coffee, hot and iced espresso beverages, teas,
Starbucks® Cold Brew, Frappuccino® blended beverages, and Starbucks Refreshers®
34
beverages.
Fresh Food
Baked pastries, sandwiches, salads, protein boxes, oatmeal, yoghourt and
snacks.
Consumer Products
• Coffee and Tea
Whole-bean and ground coffee (Starbucks and Seattle’s Best Coffee
brands), Starbucks VIA® Instant, Starbucks® Coffee K-Cup® pods, Starbucks® by
Nespresso, Starbucks® and Teavana® Verismo® pods.
• Ready-to-Drink (RTD)
Starbucks® bottled Frappuccino® coffee drinks, Starbucks
Discoveries® chilled cup coffees, Starbucks Discoveries Iced Café Favorites®,
Starbucks Iced Coffee, Starbucks Doubles hot® espresso drinks, Starbucks
Doubles hot® Energy Coffee drinks; Starbucks® Bottled Cold Brew; Starbucks
Refreshers® beverages, Starbucks BAYA™ Energy, Evolution Fresh™ bottled juices,
and
Teavana® craft iced teas.
BRANDS PORTFOLIO
Starbucks Coffee, Teavana, Evolution Fresh, Seattle’s Best Coffee and Ethos Water.

WE BELIEVE THE PURSUIT OF DOING GOOD

35
We have always believed Starbucks can – and should – have a positive impact on the
communities we serve. One person, one cup and one neighborhood at a time. It is our
vision that together we will elevate our partners, customers, suppliers and neighbors to
create positive change in the areas where we can make the biggest impact:
• Leading in sustainability: Our aspiration is to become resource positive, giving more
than we take from the planet by storing more carbon than we emit, eliminating
waste, and providing cleaner freshwater than we use.
• Strengthening communities: We seek to be a welcoming Third Place for everyone
while supporting the communities we touch – from volunteering in our local
neighborhoods to help families in coffee- and tea-origin communities.
• Creating opportunities: We invest in pathways to opportunity through education,
training and employment; hiring veterans and military spouses, refugees,
Opportunity Youth and those formerly incarcerated, and helping them build them
SWOT Analysis of Starbucks
1.Strength
As a mature and developed brand, Starbucks itself has many internal advantages. Firstly,
Starbucks has an incomparable enterprise impact than many other coffee brands. As the
top
brand in China's coffee market, Starbucks has a good corporate reputation and solid
corporate
background. Starbucks has a mature set of fixed processes from the production line,
raw materials to product processing and packaging design as a mature large-scale
company. This makes Starbucks have a stable and efficient product production capacity.
Subsequently, the emergence of several similar competitive brands can better highlight
the
strength of Starbucks Enterprises - all aspects of the capabilities of other subsequent
competitive brands are not as vital as Starbucks. For example, according to the histogram
of
ready-to-drink coffee market share in China, the data demonstrate that Starbucks has a
market

36
share of 59.2%, which is far ahead of its biggest domestic competitor, Luckin coffee
(2.4%)
[17]. Second, Starbucks’ customer loyalty is tight. Starbucks uses exquisite membership
cards
to lock in their customers. Starbucks customers are also loyal to Starbucks
through the taste of products and the experience of the whole purchase
process. Alternatively, Starbucks first provided comfortable office seats and charging
equipment for electronic products in the early days, attracting many office workers. Since
then, the choice of office workers has been fixed in Starbucks. Third, Starbucks has
strong
brand awareness. Thanks to Starbucks and its efforts to build its brand early, Starbucks
has
established a good reputation. Most of the follow-up customers come from the publicity
of
old customers. When their trusted friends recommend this coffee brand to them, it has
muscular strength and its own beliefs and values, which is easy to be the first choice of
the recommended person. Fourth, the brand scale is enormous. This coffee shop giant
currently operates with 31,256 locations across the world. On average, Starbucks has
opened
two new stores every day since 1987. The industry grew by 3.3% year on year. [18].
Starbucks was one of the largest coffee shop chains in China, with 5400 stores. Starbucks
has
a complete and powerful company, including public relations, brand building, product
design,
and many other departments, making Starbucks stable operation, good reputation, and
high
product quality. So far, its stores have been opened almost all over the world and have
abroad
audience. Fifth, the market share is significant. According to the preliminary survey,
Starbucks' market share in the Chinese market is higher than many other brands.
Sixth, the competitive advantage is obvious. Starbucks recently transformed some stores

37
located in commercial streets or shopping centers into "selection stores." "Selection shop"
is
generally open in a single building, about three floors. The products sold in the store
are different from ordinary stores. Most of the products are different from lattes or
American
coffee made by this machine. However, some high-quality hand-brewed coffee can
choose
coffee beans' type and taste. Some stores also sell unique cocktails. These innovative
products will attract more coffee lovers to visit and buy. Establishing a "selection store"
has
dramatically increased Starbucks' competitive advantage and improved brand
competitiveness. This is a creative approach. Other competitive brands in the Chinese
market
have not made similar moves until this paper was written.
2.Weakness
Starbucks has the following disadvantages in market competition: high product price,
average
product quality, low customer satisfaction of individual unique products, insufficient
understanding of customer feedback, poor service of individual stores, and insufficient
advertising and marketing. First, the product price is high. Starbucks rarely gives coupons
to
customers. The price of coffee and beverages, accessories and mugs are slightly higher
than
the average price of coffee shops in the market. The price remains
high, and occasionally there are mistakes in the proportion of beverage ingredients, which
dramatically reduces the expectation and experience satisfaction of customers. In this
case,
the cup of coffee in customers' hands has depreciated. Second, the product quality is
average.
Starbucks' peripheral products often have quality problems, such as cold-water cups and

38
mugs. The cold-water cup leaks and cannot help falling, the mug cracks, and the
insulation
The effect of the thermos cup does not comply with national regulations. There is a hole
in
the canvas bag, which may cause users to lose without the upper limit. These are serious
problems existing in Starbucks products. Third, the customer satisfaction of limited
products
in individual special seasons is low, and understanding customer feedback is not enough.
For
example, Starbucks mooncakes were on sale during the Mid-Autumn Festival and
Starbucks
Zongzi during the Dragon Boat Festival. According to the previous word-of-mouth
survey,
most customers are dissatisfied with their taste. Starbucks is indeed making efforts to
innovate its products and cater to its target market - the Chinese market. However, its
a taste survey in the early stage of the Chinese market is not enough, or it does not timely
consult and improve the feedback of Chinese customers, resulting in low evaluation of
seasonal products and customers' expectations far higher than the quality of products.
Fourth, store service attitude. In the Internet age, people can easily hear the voice of
dissatisfaction from everyone on the social platform. The poor service attitude of the
store is a severe problem and should not be underestimated. Fifth, the marketing strength
of
advertising, endorsement, and other marketing means is not enough. Starbucks has
seldom
used marketing means to promote its products in the network in China (In the US,
Starbucks
products purchased through Instagram advertisements in 2019 account for 18%) [19]. If
advertising and other means are appropriately used, with the spread of word-of-mouth by
individual users in social media or the endorsement of famous artists, Starbucks' sales
may
reach a new high.

39
3.Opportunities
Firstly, the entire beverage market contains excellent potential. In the past decade,
especially
under the circumstance of COVID-19, more and more people are paying attention to a
healthier lifestyle, including a preference for more nutrition-offering beverages catering
to their demand [20]. According to research in the hospitality industry in Australia and
New
Zealand in 2016, cafes are the most prominent place to sell healthy beverages [20].
Moreover,
among all the ready-made and non-alcoholic drinks, studies show that milk-based
beverages
offer the richest energy density [21]. Narrow down to the Chinese market, according to
the
China 2021 White Paper of Food and Beverage, Chinese customers are hoping for
products
with less fat or sugar [22]. Besides, the coffee industry in China is consistently growing,
while the public is paying more attention to its flavor [22]. These findings are presenting
opportunities to Starbucks. Now, Starbucks had already offered coffees with
options, including less sugar or low-fat milk, catering to customers' various demands.
Besides, the cooperation with Oatley this year provides customers products without
lactose,
allowing more people to consume coffee with milk [23]. Furthermore, as an old-
fashioned
chain coffee cooperative, Starbucks' constant flavor brings loyalty to its
customers, suggesting that a considerable number of people already accept its flavor.
However, as more and more beverage brands are growing simultaneously in China
presenting
either higher-quality or lower-price drinks, Starbucks' opportunities are relatively narrow.
In
the coming future,

40
If Starbucks can persist in its healthy beverage and provide more flavor options, their
customer satisfaction is more likely to rise.

4.Threats
Starbucks has also gained recognition in and popularity for the coffee they produce;
however,
in terms of their current positioning and customer value, they are more than likely to
break
compared to their existing competitors within China. Hey Tea is a franchise within the
China
Region in the beverage industry. Like Starbucks, it initially began as a single store and
now
has franchises across Asia. By December 2020, Hey Tea had already opened 695 stores
in 61
cities worldwide [24]. Notably, the brand focuses a lot on its overall customer experience,
not
only on their various ordering options but also on the value of feedback: on their ordering
page, Hey Tea offers a large scale of options; for example, in the temperature category,
each
drink has the choice from ice, less ice, cold, warm to hot, offering a unique choice for
every
buyer. Also, they promised to remake the drink if customers found the flavor
unacceptable.
Besides, Hey Tea put great efforts into research and development; averagely, Hey Tea
put
forward one new product every 1.2 weeks [24]. Therefore, the brand supplies different
coffee
and teas, but it also supplies various unique flavors of coffee and teas for different
seasons.
In the coffee market, Saturn Coffee is also a competitor to Starbucks. As an instant coffee

41
brand, Saturn Coffee had already ranked the first place in the T-mall Coffee category in
2021,
reaching over 40 million sales within one day [25]. By uniquely providing six different
flavors of instant coffee, which they call the number series, the brand offers different
coffee
beans for customers to choose from. Saturn coffee also has significant partnerships with
independent brands that match Saturn's core values [26]. The brand also collaborates with
other brands to determine flavor preferences, which ultimately leads to better product
development [26]. On the contrary, Starbucks is facing a massive threat from its
competitors.
Limited choice for customers to design their unique refreshments silently pushing the
customers away from brands like Hey Tea, while the inconvenience of a single choice of
coffee beans separate the coffee lovers from choosing other optional brands like Saturn
Coffee. As for customers satisfaction, Starbucks does not have a systematic regulation for
collecting customers' feedback or helping with flavor promotion. Plus, lacking brand
collaborations undermine its competitiveness with other local brands.

42
 CHAPTER-3
CONCEPTUAL FRAMEWORK

A conceptual framework of loyalty, satisfaction, trust, communication, and

personalization
It is closely related to Customer needs and expectations which have an increasing extent
tailor-made to the customer's specific desires. Every customer is to have a unique
treatment and unique offers. Customizing concerns on the following steps
 Identify the customers and their buying habits
 Differentiate the customers according to value and need.
 Open a dialogue with the customers
 Customizing goods and services on offer to different customers.

The degree of customer satisfaction is the ultimate measurement of quality. It is always

the customers who judge the quality of goods or services. Customer satisfaction is related
to the needs and expectations of the customers. These in turn are affected by several
factors, such as previous personal experience, the renown of the products or services,
what the company has promised and some extent, the price of the goods or service.

43
 CHAPTER-4

ANALYSIS AND INTERPRETATION OF DATA

A questionnaire survey was conducted and answered by 105 respondents. The survey
form was distributed into two sections: demographic and questionnaire. This
questionnaire comprised multiple choice questions and open ended questions. In the
open-ended questions, the respondents were expected to provide their valuable
comments, suggestions, and recommendations for further improvement of Starbucks
products and customer service. The objective behind these questions was that the
customers can state or express anything they felt missing or their expectation from
Starbucks.

Characteristics Category Frequency Percentage

Gender Male 75 71.47%
Female 30 28.6%
Age Below 20 years old 12 11.4%
20-29 years old 90 85.7%
30-39 years old 3 2.9%
40-49 years old 0 0.0%
50 years old and 0 0.0%
Above
Occupation Student 94 89.5%
Employed 7 6.7%
Unemployed 4 3.8%
Have you heard of Yes 94 89.5%
Starbucks Coffee No 8 7.6%
before? Maybe 3 2.9%
Are you satisfied Yes 94 89.5%
with the service No 8 7.6%

44
offered in the store Maybe 3 2.9%
How did you get to Friends and family 64 61.0%
know about Advertisements 33 31.4%
Starbucks? Magazines and 3 2.9%
newspapers 3.8%
Social media 4 0.9%
What is the factor Ambience 35 33.3%
that attracts you Products 28 26.7%
towards the store? Brand image 23 21.9%
Environment 19 18.1%
Customers’ Review Extremely expensive 41 39.0%
on Expensive 39 37.0%
Price of Beverages Reasonable 21 20.0%
Cheap 0 0.0%
Extremely Cheap 4 4.0%
What is the thing Pricing of the 55 50%
you would like to products
change? Location of the store 35 25%
Quality of materials 20 25%
Do you visit the Yes 35 25%
store regularly? No 21 25%
Maybe 49 50%

45
SURVEY RESULT AND SUMMARY OF FINDINGS

The survey was answered by 105 respondents consisting of 71.4% females and 28.6%
male. Most of them were between 20 to 29 years old. By occupation, the majority of
respondents (89.5%) were students.
It shows that 89.5% of the respondents have already heard of Starbucks
Coffee before. Based on the data, Starbucks has successfully gained attraction and
attention from most people.
A total of 61% of respondents got the information about Starbucks Coffee’s products
from their friends, family members and colleagues. Besides, 31.4of the respondents
knew Starbucks Coffee from social media such as Facebook and Instagram. This implies
that friends, family members, and colleagues play major role in sharing the information
about Starbucks Coffee.
According to the results of the survey, 33.3% of the respondents favorite Starbucks’
coffee, 26.7% of the respondents like its Frappuccino. This illustrates that to increase
customers’ satisfaction, Starbucks Coffee should come out with the new flavor of coffee
and Frappuccino.
Most of the respondents (39%) are moderately likely to recommend Starbucks coffee to
their friends or colleagues, while 23.8% of the respondents strongly will recommend to
their friends or colleagues. However, 10.5% of the respondents, will not recommend
Starbucks products to their friends.
Furthermore, we found out that 29.5% of the respondents are very satisfied with the
overall performance of Starbucks and 37.1% of the respondents are satisfied with it.
Also, 22% of the respondents were neutral, and only 5.7% of them are dissatisfied and
very dissatisfied with the overall performance of Starbucks. The results clearly indicate
that Starbucks is doing great to fulfil customers’ needs.
The results of the survey also shows that 39% of the respondents agreed that the price
Starbucks beverages are extremely expensive. Similarly, 37% of the respondents also
I think that the price is expensive. However, 20% of them were neutral while only 4.0%
of
The respondents think that the price is very cheap. This leads to a conclusion that there
46
is a need to reduce the price so that the customers can enjoy the beverages at a more
reasonable price.
Moreover, the results of the survey shows that 42.9% of respondents are very satisfied
with the quality of Starbucks Coffee while 31.4% of the respondents are satisfied with it.
We can conclude that the quality of Starbucks Coffee has obtained their customers’
satisfaction and Starbucks should maintain its quality to satisfy customers’ needs in the
future.
It also illustrates that 44 respondents (41.9%) were satisfied with Starbucks
customer service, 38 respondents (36.2%) are very satisfied with the service provided.
This shows that most customers are satisfied with Starbucks customer service.
Addedly, 38.1% respondents changed their perception of Starbucks to be more favorable
in the past three months. Only 19% out of 105 respondents have changed them
percept00ions to be extremely favorable and 31.4% of them have neutral opinions. The
respondents with a lower interest in Starbucks in the past few months occupy 11.4% of
the total respondents.
Besides, 13% of the respondents think that Starbucks very often does promotion while
25.7% believed that Starbucks often does promotions. Most of them (40%) were
neutral. However, 15 respondents (14.3%) and 8 respondents (7.6%) agreed that
Starbucks Coffee rarely and very rarely does promotion.
By the frequency of customers purchasing Starbucks Coffee’s product, 53.3% of the
respondents rarely buy bought Starbucks’ product while 16.2% of them have never
purchase Starbucks’ product. Additionally, 4.8% and 6.7% of the respondents buy
Starbucks’ product once a week and two or three times in a week respectively. Similarly,
10.5% and 8.6% of them buy Starbucks’ product once in a month and two or three times
in a month respectively. However, none of them will buy Starbucks’ products every day.
In addition, the survey shows that 51.4% of the respondents love Starbucks dine in and
25.7% of them love all Starbucks services (dine in, drive-thru and online ordering apps).
This indicates that most of the customers were quite satisfied with all options provided
and most of them prefer to dine in.
The survey also shows that “Tasty” (51.4%) is the most chosen factor that attracts
customers buy Starbucks coffee’s product. The second highest chosen factor is “Good

47
Environment” (41.9%), followed by unique drinks (35.2%) and good service (31.4%).
This
signifies that tasty and unique beverages, good environment and service satisfying the
customers’ needs are the factors that keep the customers’ loyalty to Starbucks.
For improving Starbucks customer satisfaction, the respondents have provided several
recommendations. Among the price reduction, promotions, improved customer
service,more
store availability, special interior design and others, 45% of the respondents
pointed the price reduction since most of the people or students cannot afford Starbucks
beverages. A total of 15% of the respondents suggest Starbucks have more promotion
such as special promotions for students. This concludes that price is the most common
issue for the people not buying Starbucks products.
Based on the result presented in Table 1, as most of our respondents are students, they
thought that the price of beverages in Starbucks is extremely expensive, and this might
be the reason more than half of the respondents rarely purchase Starbucks products.
Therefore, affordable price should be Starbucks major consideration to attract low
income
group of customers.
Moreover, Starbucks Coffee can do more promotion to attract customers, such as Buy 1
Free 1 at a certain period. Also, they can do promotions specialized for students.
For instance, when students show their student cards, they get 15% off from the total
amount. This could attract more customers as recently youngsters like to hang out with
friends after their class. They will usually choose some coffee shops they could afford.
India has a total area of 38287 million km². Currently, there are 191 Starbucks stores in
India and there are many potential markets to be explored. Starbucks should focus on
expanding its market by opening more new stores in cities such as Nashik.

For example,
Starbucks owns up to 300 stores in Malaysia in November 2019. Compared to countries
Unlike Malaysia, India has a larger area for the company to expand its market. With that,
Starbucks should choose more strategic locations to expand its potential markets in the

48
respective country. This will make more local people are able to access Starbucks and
enjoy the services. This also could improve their brand image as more residents
recognize this brand not only by advertisement but also by their own experiences.
Additionally, Starbucks should open stores with unique interior designs or with elements
that are different from the other stores. They can be unique from the menu perspective
or from the design of the building. This could attract travelers and youngsters who like to
check in themselves at unique cafe shops. Besides that, it is significant to create a
relaxing and enjoyable environment that matches the lifestyle that the brand promotes.
This idea is suggested to correlate with the survey that shows a good environment is one
of the important factors that attract customers to buy Starbucks’ products. It is believed
that Starbucks can kill two birds with one stone if it opens more stores with unique
elements in other locations in India.
Professional training and workshops should be continuously provided to ensure the
quality of front-desk customer service in Starbucks. Customers stress on the quality of
service when they relate their satisfaction with a certain brand. Most of the Starbucks
customers chose to dine in and enjoy their meal in the shop. They focus on the buying
experience other than the taste of food. Therefore, employee training plays an important
role as it provides the employee with the correct way to serve the customers and improve
their skills in making food and beverages. For instance, a customer will leave a good
impression on a shop when they have employees with a good attitude. It is proved that
a good impression from customers will lead to higher customer satisfaction and thus
increasing the loyalty of the customer.
Starbucks Coffee has been using a value-based pricing strategy to maximize their profit.
It is also called customer-based pricing as the price is set on how much of the target
consumers believe it is worth. Starbucks uses this strategy because they can set higher
prices compared to the competitors which they believe their customers are willing to pay
for. Starbucks Coffee is confident that the unique products and services provided satisfy
their customers and make them loyal to the brand. However, Starbucks Coffee is
suggested to reduce the price of their products as there are some consumers who
complained about the expensive Starbucks menu prices. Price reduction may attract
more customers to try Starbucks Coffee, yet there is a risk to do so. For Starbucks’ loyal

49
customers, value matters more than the price. A sudden reduction in price will affect their
perception of Starbucks as a high-quality brand that provides premium products and
services. Starbucks which is often graded as a premium and high-class coffee brand
could not afford to risk the brand being perceived as a low-quality brand which will
affect
the loyalty of customers. There is a risk of losing more loyal customers than having a
chance of gaining new customers if Starbucks reduces the price.
Some customers complained that Starbucks Coffee’s stores are far away from their living
area and it takes a long time for them to buy a cup of coffee or having difficulties to have
a relaxing time with their family and friends at the stores. To solve this problem and
increase customer satisfaction, we suggest opening more Starbucks Coffee’s stores in
every area in India to expand the business. This is because it is necessary to satisfy the
huge demands as India is a country with a vast population. However, there is a risk to
open more stores as it could make the operating cost higher, decreasing the profit.
Starbucks Coffee needs to pay a lot of fees such as construction fees, maintenance fees,
utility fees, and labour fees. Cost is an important factor that needs to be considered when
opening more stores.

50
 CHAPTER-5
CONCLUSION AND RECOMMENDATION

This research investigated individuals' perception and satisfaction in delivering the brand
(Starbucks) influence and service quality that is directly connected with customers’
loyalty. This study has a great emphasis on the corporate brand image of Starbucks
which may affect customer satisfaction. Therefore, with respect to this research, it is
clearly defined that Starbucks needs to be more focused on some issues with the
purpose of building a strong everlasting relationship with the customers and mutually
profitable relationship in the market. Customer satisfaction is described as a variable that
indicates how good their brand experience is. Starbucks, which is recognized to be the
world's reputed brand, has a definite standard to increase their service quality, brand
image and individual satisfaction. By conducting regular surveys to get to know more
about customers, Starbucks can fulfil their needs that change from time to time and this
will increase customer satisfaction in the future.
As if we contrast with other techniques, we believe that our method of doing analysis is
more appropriate for our decision making. At some time, we can state that customers
can be convinced by the quality of product, and the customer service provided by the
company. From the survey we did, we found that most of the customers are satisfied
with the quality of product and customer services provided by Starbucks. However,
some of them are not satisfied with the price as it is too expensive, Starbucks, thereby,
should maintain its product quality with reasonable prices to attract more customers.
There are several alternatives the researchers provided to improve Starbucks services
and gain more customers based on the survey. Starbucks should do more promotion
and reduce the pricing to attract more customers from different classes. Subsequently, to
expand their markets and reach out more customers, Starbucks is suggested to
expand their stores in more strategic areas. Besides, special stores with unique interior
designs can pique the interest of more customers as well. Starbucks also needs to
provide professional training to their employees to serve the customer better and

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therefore, improving customer satisfaction. In conclusion, Starbucks must be innovative
in ideas and focus on quality control and beware of risk that could happen to achieve
their-long term targets and growth of the company.

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APPENDIX (QUESTIONNAIRE)

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