Do you think that Starbucks has grown rapidly because of its ethical and socially responsible activities or because it provides products and an environment that customers want?
This question is more complicated than it seems. In today’s culture, it is difficult to separate ethical business practices and social responsibility from “the products and environment that customers want.” The general public is paying a lot more attention to how businesses behave than they used to, and in the minds of many modern consumers, a company’s image depends both on the quality of their products and on their reputation for ethical behavior.
It is not an either/or answer: we want good coffee in a pleasant environment, but we will not give our money to a business if we disapprove of their social practices. If I had to choose, I would say that Starbucks is successful because they have really emphasized their ethical standards and social actions and that makes customers feel good about buying their products.
In my opinion, Starbucks has become such a behemoth in the coffee/cafe industry because they spend a lot of money on advertising and pushing a “brand image” that makes consumers believe that they are the default—or sometimes the only—choice for coffee. Many people will not bother to look for other local options if there is a Starbucks conveniently located on every corner.
Starbucks commitment to ethical and socially responsible activities is certainly a reason for part of its robust growth. However, I believe it is not the primary driver of its business success. Starbucks is successful and growing because it has, from the outset, differentiated itself in its niche. Starbucks is a concept of gourmet coffee in a pleasant, contemporary setting with innovative coffee recipes and quality food and dessert items.
Is Starbucks considered expensive by many? Yes. However, the Company is targeting that subset of coffee drinkers (or niche) that appreciates and seeks out first-rate coffee, tea, hot chocolate, and more. They are less concerned about price than those who frequent more, can I say, discount-priced coffee businesses.
Starbucks offers a premier product and their prices actually contribute to its brand persona. In essence, if its luxury-priced it must be a fine luxury product. At least this is the message conveyed and bought into buy a good portion of the coffee buying public.
Starbucks constantly innovates with beverage and food items. It does not apologize for being at the top end of retail coffee shop pricing. It has its commitment to top-of-the-line organic, fair trade, and premium coffees (and teas). The Company is at the vanguard of dynamic promotional activities, tied to first-rate products, and it knows exactly who its customers are. Therefore, it communicates to them in the language this niche understands. The above Certified Educator is dead on saying, "Many people will not bother to look for other local options if there is a Starbucks conveniently located on every corner.
Starbucks growth is the result of the Company giving it customers exactly what they desire when it comes to its products. Starbucks' ethical and socially responsible activities are the icing on the cake in the eyes if its customers - who typically go to Starbucks first for the 'cake.'
The ethical and social responsibility appears to be more of a business tactic than a genuine interest in creating a socio and eco-friendly company. Not all that glitters is gold, and I believe Starbucks likes to give the illusion that their products are more wholesome than they appear and that their employees (partners) are happier than others. In today's society, a lot of the people spending their money want to put it towards companies that are advocates for societal change (liberally leaning especially) and do not use as many chemicals in their consumables. For example, buzz words like "free-range", "organic", "GMO free", and "fair trade" are ones that consumers gravitate towards. As a former employee, I can tell you that Starbucks certainly loves using buzz words to entice customers. Many of their products have the same "bad" things that other companies use: high fructose corn syrup, artificial flavors, preservatives, etc. Consumers come to Starbucks under the assumption that they are getting a more wholesome beverage. That is not to discredit some of the work they have done to help small coffee farmers. But, as I said, people are more willing to spend a little more if they think their money will be used to help others. I believe that Starbucks is capitalizing on that and making a pretty profit on people's desire to be ethical consumers. To answer your question, I believe Starbucks knows it's consumer base and tries to create products and environments that are attractive to them. Appealing to the consumer and upping their profits is 100% their goal. It's about appearances.