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Coffee Industry Marketing Plan Development

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Coffee is an extremely treasured product. It is presumed that more people consume this precious product every day as they depend on it for their livelihoods. As such, there exist many coffee outlets in the American, European, Australian markets, etc. to include a chain of coffee cafes and independent coffee cafes. A wide chain of coffee stores holds a significant share in the Australian coffee market with the key players being Starbucks, Gloria Jeans, and the McCafe. The coffee market has been very competitive through several components including the service, coffee quality, prices, the atmosphere of coffee cafes, etc. that have an enormous impact on the customer's buying behaviour. Additionally, the external environment also significantly affects the coffee market. However, no matter the coffee outlet, there remains to be room to penetrate the market. This paper seeks to examine the background of the leading competitors in Australia. We will further analyse the various factors and the current state of the coffee franchise.

Starbucks, Gloria Jeans, and McCafe Brands and their Marketplace

Starbucks was founded more than four decades ago, and since then the firm has experienced remarkable growth and success[1]. Today, it is perceived as the go-to coffee shop where people go to work and socialize, a notion that matches well with the company’s marketing strategy. Starbucks strives to create a conducive and relaxed atmosphere where its customers stop between work and home[2]. This technique has been proven to be a success for the company as it generates revenues of nearly $21 billion as of 2016[3].

Gloria Jean’s Coffee is an Australian coffee specialty company that was founded in 1979[4]. The brand is largely synonymous with providing quality coffee and is also a leading franchise system. Gloria Jean's serves and sells a wide range of espresso coffee products, blended and whole bean coffee, and cold drinks. The company is committed to providing the world's highest standard and consistent specialty coffee products. Presently, the company has entered many foreign markets and continues to grow its presence. This has enabled the company to draw a large base of customers and increase their revenue base. On the other hand, McCafe is a coffee shop owned by McDonald's that was established in the 1990s in Australia[5]. The brand has been a strong challenger for coffee market competitors in the Australian market. The brand boasts of offering premium coffee and strives to maintain this reputation in major markets. This has helped them to acquire a strong global presence with a reputation for providing customers with good value for their money.

Positioning of the Products in the Market

Market positioning is the way in which products are placed in a manner to occupy a clearer, distinctive, and desirable place that is relative to the rival company’s products[6]. The positioning strategy is based on customers so as to provide excellent services outside the customers' expectations[7]. Starbucks position itself as the premium product in the coffee market by offering high quality, innovative products, and providing great services to their customers. Price and product standards determine the value of the product[8]. When Starbucks was established its products were expensive and was positioned in accordance to that as they seek to deliver high value promised to their customers. McCafe has positioned its coffee products to target customers who appreciate high standard coffee offered at low prices served by well-trained staff at, and seek an excellent product in an attractive atmosphere. Gloria Jean’s café also has a strong brand recognition and positioning. The company has positioned its products on offering high quality and excellent experience.

The coffee market is a very competitive industry. As such, a company’s competitive advantage is centered on its strength and opportunities they address, as shown in the SWOT analysis.

Strengths - Identifying the company's key strengths is important to enable drive customers to a brand. A good quality and consistent coffee and a strong coffee culture help coffee brands to offer unique products that meet the customer's needs. This element should not only be limited to the coffee standards provided by the coffee chains but should also focus on the environment in which the coffee is consumed. The lifestyle of people has completely changed throughout the years as the economy experiences growth in the disposable income, and most people are willing to spend more on premium products and services.  The coffee drinkers have become more demanding, educated, and discerning of their coffee shops and its staff. Coffee consumers are now discussing the taste and the ‘mouth feel' of their coffee the same way they do in specialty products such as ‘artisanal food.' Consumers are beginning to align themselves with healthier and leaner alternatives to make a preference of gourmet coffee over the traditional based coffee. Additionally, the cafe's staffs are not looked upon as just waiters but as skilled employees whose talent make a huge difference to the taste of the coffee.


Weaknesses - The emergence of the internet brought about by advanced technology has made it possible for people and business to transact over the online platforms. The online platform is mainly used to display products information and to sell them. This feature has a significant impact on coffee shops as they need to put more weight on it.

Opportunities - By providing an exquisite cup of coffee to consumers in an enjoyable and relaxed atmosphere, coffee franchises should start focusing on diversifying its product portfolio without negatively affecting their core business. An innovative culture is what is needed in the coffee market to produce unique products and services that satisfy consumer needs. When applied strategically, this factor has a significant and long-term positive impact on the coffee franchises as it helps to minimize costs, and increase profits.

Threats - This element of the SWOT analysis is centred on the external dynamics that may diminish the business performance[9].Competition is considered as the major cause of concern for most organizations. Stiff competition has the magnitude of lowering a company’s profits since competitors have devised ways to draw consumers with superior products at affordable pricing.

From the above analysis, possible gaps are evident in the coffee market. There exists an emerging trend of coffee consumption where people are seeking healthier lifestyles and want to be provided with gourmet and organic food products. The healthy trend and hectic lifestyle of the people are likely to influence the coffee shops in future[10]. There also exists a lag in technology investment which tends to limit transactions.

Two Alternative Marketing Strategies for the Products

It is highly recommended for coffee brands to take into consideration the demand among consumers for healthier, quality coffee products as well as specialty beverages. Offering low-quality cappuccino and espresso even for a discounted price is less likely to appeal the contemporary and more sophisticated coffee enthusiast who would prefer to pay more for premium products.  Coffee outlets need to take this on board and also introduce new recipes and a wide range of diversified types of coffee on its menu. Advanced technology has simplified transaction process for people and business because of its speed and convenience. Coffee franchises need to develop and actively run online platforms for them to reap high benefits. This platform will enable them to display and sell their products to customers via the internet and also facilitate one on one communication with customers.

Organizations need to develop a solid marketing plan for their businesses. As such, coffee brands can start by identifying its target market. These market can be broken down into smaller groups such as age, profession, income, etc. Segmenting the market is essential to identify a consumer's distinct characteristics and to position a business or product to its target market reasonably[11]. Likewise, may need to develop a plan to boost its online presence. A substantial investment in technology is crucial to improving the ordering and payment processes. As such, they must be ready to heavily invest their time and resources developing internet technology to widen online presence.


The marketing strategies discussed above aims at making coffee brands products available to their customers. To achieve this, the companies should strive to promote the quality, affordability, and convenience in the take home compendium. Starbucks, Gloria Jean’s, and McCafe each have designed and implemented their own strategies which seek to provide products that are high on quality and at affordable pricing, this offers a natural selection in reaching the suitable potential customers.



Euromonitor International. Cafes/Bars in Australia. Retrieved on 18 May, 2017 from

Gloria Jean’s. About Us. Retrieved on 18 May, 2017 from, 2017

Kotler, P., & Armstrong, G. Principles of marketing. Upper Saddle River, N.J: Pearson, 2014

Kotler, P., & Keller, K. L. Marketing management. Upper Saddle River, N.J: Prentice Hall, 2012

McCafe. About Us. Retrieved on 18 May, 2017 from, 2017

Starbucks Annual Report. Annual Report. Retrieved on 17 May 2017,, 2016

Starbucks. Retrieved on 03 May 2017, from, 2017

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