Answered: Once recognized as a threat, what could…

Principles Of Marketing

17th Edition

ISBN:9780134492513

Author:Kotler, Philip, Armstrong, Gary (gary M.)

Publisher:Kotler, Philip, Armstrong, Gary (gary M.)

Chapter1: Marketing: Creating Customer Value And Engagement

Section: Chapter Questions

Problem 1.1DQ

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Question

From our textbook, we have learned that Folgers was very slow to recognize the potential retail giant that was Starbucks. The Seattle-based company was taking the coffee world by storm. Hundreds of retail coffee houses were opening across the country as market share, and customer wants bloomed. Starbucks following continued to gain strength as store after store was opened in what seemed like every town in America. Proctor & Gamble, Folger’s parent company, did nothing while Starbucks took over the coffee shop market and then carried that momentum into grocery stores. Starbucks, the coffee house juggernaut, was now on the same shelf as Folgers. P&G’s only answer was to sell Folgers. It had no recourse against the coffee powerhouse from the west coast.

Questions:

Once recognized as a threat, what could Proctor & Gamble have done to combat the insurgence of Starbucks into their market share?
Was selling the Folgers brand the correct choice for Proctor & Gamble?
Could P&G have done anything different to retain the Folgers brand and its market share?

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