Use The Work You Completed For Parts I, II, And III With You ✓ Solved

Use the work you completed for Parts I, II, and III with you

Use the work you completed for Parts I, II, and III with your CLC group to inform your analysis for this assignment. Write a 1000-word summary of how the reports for Parts I, II, and III of the CLC assignment were influenced by the analysis prepared in previous assignments your CLC group has completed in the course. Without prematurely determining and formalizing strategic goals and objectives, begin thinking about possible strategies to capitalize and add value to the organization based on the analysis of this information. Be sure to cite three to five relevant and credible sources in support of your content. An abstract is not required.

Part I: Marketing Expenses vs Rival Firms

Starbucks: Starbucks holds such weight in the marketplace that they do not need to spend as much in marketing and advertising as their competitors McDonald’s and Dunkin’. In fact, over the last three years Starbucks has spent significantly less in advertising each year. In 2017 their advertising expenses total $282.6 million, in 2018 it totaled $260.3 million, and in 2019 it totaled $245.7 million (Starbucks Corporation, 2019). This shows that within 3 years, Starbucks continued to stay number one in the marketplace and was able to spend $20.3 million less in advertising. Another key takeaway from the 10-K report has shown that all advertising costs are expensed as they are incurred with the exception of production costs. These are expensed the first time the advertising takes place (Starbucks Corporation, 2019). In 2019, Starbucks reported a global revenue of $26.5 billion with most of that revenue coming from the Americas (Guttman, 2020). Media advertising has proven to be effective in the Americas as Starbucks has lowered the amount of spending in media advertising by $5 million since 2018. Considering that only 10 percent of their total revenue has come from non-America regions, it would be advantageous to invest additional money in marketing and advertising in non-America regions (Guttman, 2020).

McDonald’s: Just like Starbucks, McDonald’s has spent less each year in advertising. Their advertising expenses went from $476.8 million in 2018 to $447.3 million in 2019 (Lock, 2020). Even with the annual decrease in advertising expenses, they still spend significantly more in advertising compared to other quick service restaurants such as Domino’s and Jack in the Box. The investment in advertisement has proven to be effective as McDonald’s continues to be a global household name.

Dunkin’ Donuts: Unlike Starbucks and McDonald’s, Dunkin’ Donuts has increased its spending in marketing and advertising. From 2018 to 2019, Dunkin’ had spent an additional $8.7 million in advertising, which was due to nationwide sales growth (Dunkin Brands, 2019). A major differentiator between Dunkin’ and its competitors is how they receive funds to put towards advertising and marketing. Each of their franchisees in the United States is required to pay at least 5% of their weekly gross sales to put towards Dunkin’s advertising fees (Dunkin Brands, 2019). In 2019 alone, franchisees contributed roughly $473.6 million towards Dunkin’s advertising fund that goes towards national and local advertising and marketing (Dunkin Brands, 2019). This method has proven to be effective, as Dunkin’s revenue has steadily increased over the last eight years (Lock, 2020).

Part II: Perceptual Map Analysis

The results show that Starbucks dominates the market with its shop and kiosk presence. It proved that its early expansion had a positive impact to their business recognition, and they were able to build customer loyalty early on and attract a lot of customers as quickly as possible. From recent earnings reports, other than actual geographic, Starbucks also increased its presence digitally by reporting a 75% sales volume arising from the drive-thru and mobile orders and an increase of 10% year over year for its Starbucks Rewards membership (Starbucks, 2020). As McDonald’s being so close with Starbucks and allowing to be the option to go for a cheaper coffee and Starbucks’ challenge to keep up with its high-priced coffee, the company has not shown that their pricing disappoints the quality of their product. As a result, they are in an ideal position and offer their consumers not only higher-quality products but also a great rewards program that helps ease the high prices. Starbucks is known to be everywhere and strategists showed concerns that the company might suffer from saturating its market; for some reason people have always seemed to appreciate the opening of a new Starbucks store in their neighborhood, rather than some competitors. The increasing number of Starbucks stores had positive effects on employees, coffee growers and, most importantly, investors. Compared to their competitors Starbucks creates an atmosphere that no other competitor can offer which allows their customers to feel more welcomed.

Perceptual mapping is a method used to learn how to better position the company to meet its consumer needs and wants by comparing Starbucks to its competition (David et al., 2020). As a result, the perceptual map shows that the company put the emphasis on convenience and high-quality coffee products which results in a high price and high satisfaction for its customers by providing an environment and atmosphere their competitors can’t provide.

Part III: Existing and Proposed Organization Chart

Existing: Proposed (Chart is different but titles match with numbers from above. Ie: 1 = Howard Schultz)

Paper For Above Instructions

Introduction

This summary synthesizes how Parts I, II, and III of the CLC group's reports were shaped by prior course analyses and outlines initial strategic options to add value to the organization. The group’s prior analyses—financial benchmarking, competitive positioning and perceptual mapping, and organizational structure review—collectively informed each part of the assignment and point to practical strategic directions that remain exploratory rather than formalized goals.

How prior analysis shaped Part I (Marketing Expenses vs Rival Firms)

Preceding assignments that analyzed financial statements, market share, and regional revenue split directly framed Part I. Financial benchmarking revealed Starbucks’ strong revenue concentration in the Americas and comparatively low advertising intensity relative to competitors (Starbucks Corporation, 2019; Guttman, 2020). That insight led the CLC group to interpret lower advertising spend not as underinvestment but as a function of brand strength and efficient targeting (Kotler & Keller, 2016). Similarly, franchise-fee structures and co-op advertising models studied earlier helped explain Dunkin’s higher and sustained marketing pool through mandatory franchise contributions (Dunkin Brands, 2019). McDonald’s larger ad spend was contextualized by its global mass-market positioning and need for sustained top-of-mind awareness in multiple markets (McDonald’s Corporation, 2019).

How prior analysis shaped Part II (Perceptual Map Analysis)

Earlier consumer research and competitor analyses informed the perceptual mapping. The group had previously collected competitive attributes—price, convenience, ambiance, product quality, and rewards programs—and validated these via secondary sources (David et al., 2020). This supported mapping Starbucks as high-price/high-quality with high convenience due to store density and digital capabilities (Starbucks, 2020). Prior segmentation work also clarified why McDonald’s and Dunkin occupy adjacent positions (value-focused convenience offerings) and why Starbucks’ differentiated “third place” experience is a meaningful competitive moat (Pine & Gilmore, 1998).

How prior analysis shaped Part III (Organization Chart)

Organizational design recommendations drew on earlier analyses of capabilities, governance, and global/local franchise dynamics. The group’s prior assessment of decision rights, centralized versus decentralized structures, and the role of regional management clarified where Starbucks’ central functions versus field activities should align. The proposed chart reflects where digital, supply chain, and international marketing capabilities need stronger representation to support the opportunities identified in Parts I and II (Barney & Hesterly, 2019).

Cross-part linkages and analytical influence

The most important influence across Parts I–III was the triangulation of financials, consumer perceptions, and capability mapping. For example, the low ad spend (Part I) combined with strong brand equity (Part II) and a relatively centralized marketing capability (Part III) suggested an opportunity: redeploy modest incremental marketing investment into targeted international digital campaigns rather than mass media in the Americas. This insight could not have emerged without integrating previous financial and consumer analyses.

Early strategy ideas to add value (exploratory, not formal goals)

• Targeted international digital expansion: Increase spend selectively in under-penetrated non-Americas markets focused on mobile ordering and localized promotions to accelerate revenue diversification (Starbucks, 2020; Guttman, 2020).
• Franchise co-investment models: Explore hybrid co-op advertising or incentive pools with international partners similar to Dunkin’s model to scale local reach without burdening corporate cash flow (Dunkin Brands, 2019).
• Drive-thru and mobile optimization: Prioritize operations and tech investments to deepen the drive-thru and mobile orders channel that already accounts for a high portion of sales, improving throughput and margin (Starbucks, 2020).
• Experience and premiumization: Defend the “third-place” positioning with store-level innovations and premium product launches that justify price premiums while enhancing loyalty program value (David et al., 2020).
• Organizational enablement: Strengthen regional marketing and analytics functions in the org chart to execute localized campaigns and derive rapid learnings across markets (Barney & Hesterly, 2019).

Conclusion

The reports for Parts I–III were shaped by prior financial, consumer, and capability analyses conducted earlier in the course. Those analyses provided the empirical basis to interpret advertising intensity, perceptual positioning, and organizational needs. Early strategies that emerge—targeted international digital spend, franchise co-investment, drive-thru and mobile optimization, premium experience reinforcement, and org design adjustments—are initial directions for value creation. Each remains exploratory and should be tested through pilots and scenario analysis before being formalized into strategic goals.

References

• Barney, J. B., & Hesterly, W. S. (2019). Strategic Management and Competitive Advantage. Pearson.
• David, F. R., David, F. R., & David, M. E. (2020). Strategic Management: Concepts and Cases (17th ed.). Pearson.
• Dunkin Brands. (2019). Dunkin’ Brands Group, Inc. 2019 Annual Report. Dunkin Brands.
• Guttman, D. (2020). Starbucks: FY2019 Results and Outlook. The Motley Fool. Retrieved from https://www.fool.com
• Kotler, P., & Keller, K. L. (2016). Marketing Management (15th ed.). Pearson.
• Lock, S. (2020). McDonald’s Annual Report 2019: Advertising and Marketing. McDonald’s Corporation.
• McDonald’s Corporation. (2019). Form 10-K 2019. McDonald’s.
• Pine, B. J., & Gilmore, J. H. (1998). The Experience Economy. Harvard Business Review Press.
• Starbucks Corporation. (2019). Form 10-K 2019. Starbucks Corporation.
• Starbucks. (2020). Key takeaways from Starbucks Q4 FY20 earnings results. Starbucks Newsroom. Retrieved from https://stories.starbucks.com