The document summarizes research on Starbucks' social media marketing strategies in the Middle East. It identifies 6 key factors that drive consumer engagement on social media pages: 1) influence of other customers, 2) user's participation, 3) brand affinity and social belongingness, 4) willingness to share experiences, 5) seeking help, and 6) timing of brand generated posts. Quantitative research including factor analysis and cluster analysis was used to identify these engagement factors and profile social media users.

1. Company Research Project - 3
SOCIAL
MEDIA
MARKETING:
Starbucks
Middle
East
Prepared by: Bhrigu Sawhney
Roll Number: MGBSEP13CMM035
1

2. AGENDA
❖ Background
❖ Research Topic
❖ Objectives
❖ Summary of Literature Review
❖ Research Methodology
❖ Conclusion & Insights
❖ Recommendations
2

3. BACKGROUND
3

4. SOCIAL MEDIA
WHAT IS SOCIAL MEDIA?
Social media are easy to use web publishing tools. As a result anybody
can have a voice and be found through simple tools like Google
search. This creates a power shift towards those who participate – and
those that don’t must catch up.
4
LOTS OF SOCIAL
MEDIA WEBSITES !

5. FRAMEWORK FOR BRANDS
❖ Social Media provides an opportunity for marketers to interact, engage and
retrieve feedback from their customers and public at large
USER
USER
USER
USER
USER
USER
USER
USER
USER
USER
USER
USER
USER
USER USER
USER
USER
USER USER
ORGANISATION
SOCIAL MEDIA PLAT. 1
SOCIAL MEDIA PLAT. 2
SOCIAL MEDIA PLAT. 3
SOCIAL MEDIA PLAT. 4
5

6. #STARBUCKS
❖ Starbucks is considered to be one of the most
successful Social Media stories
❖ Starbucks’ global social media page (pre-
dominantly for American users) is ranked
consistently high across the most popular
social media platforms
❖ Starbucks focussed on ensuring that the
contents of its coffee and its social media
pages were in the best interest of its
customers
❖ Launched successful campaigns -
BloandRoast (Giveaway), PumpinkLatte
(pre-launch customer engagement), Tweet-a-
coffee (offer coffee to a friend through
twitter)
Source: www.facebook.com/starbucks
6

7. #STARBUCKS
Source: Foodservice Social Media Universe (2012) 7

8. ❖ Starbucks extends its Social Media presence
through Starbucks Middle East Facebook
and Instagram pages
#STARBUCKS MIDDLE EAST
FANS
~230K1
The pages cater to -
Bahrain, Egypt, Jordan, Kuwait, Lebanon,
Morocco, Oman, Qatar, Saudi Arabia and
United Arab Emirates
1Source: www.facebook.com/starbucksmiddleeast 8

9. RESEARCH TOPIC
Social Media Marketing Strategies:
Starbucks Middle East
9

10. RESEARCH OBJECTIVES
1.To evaluate the effectiveness of current Social Media
Marketing Strategies applied by Starbucks Middle East.
2.To identify variables that drive consumers to participate on
the Social Media pages of Starbucks Middle East.
3.To construct the likely profile of people engaging on the
Social Media pages of Starbucks Middle East.
4.To identify opportunities for increasing the customer
engagement on Social Media pages of Starbucks Middle
East.
10

11. LITERATURE REVIEW
11
INDUSTRY DATA

12. WHOM DO WE TRUST?
12

13. INDUSTRY DATA
❖ 97 %1 of marketers indicate that
they use Social Media to market
their business
❖ Majority of marketers believe
that social media helps them
with following:
๏ Increase Exposure
๏ Increase Traffic
๏ Develop loyal fans
๏ Provide marketing insight
๏ Generate leads
๏ Improve search rankings
๏ Grown business partnerships
๏ Reduce marketing expenses
๏ Improve sales
1Source: 2014 Social Media Marketing Report By Michael Stelzner (May, 2014) 13
Source: 2014 Social Media Marketing Report By Michael Stelzner (May, 2014)

14. INDUSTRY DATA
14
❖ The number of monthly active monthly active users on Facebook as March 31,
2014 stood at 1.28 billion (Facebook, 2014)
❖ The number of users who log on to social media websites has grown drastically,
which is largely because of the fact that Social Media is no longer in its infancy
stage (Nielsen, 2012) and thus is maturing (Ivanauskas , 2011)
Source:
www.statista.com
(Number
of
monthly
active
Facebook
users
worldwide
2008-­‐2013)

15. INDUSTRY DATA
❖ Growth is largely due to the emergence of a new
generation, born between 1977 and 1997 and
representing 40% of the MENA population, which is
extremely active online and in social networks (Booz &
Company, 2012)
❖ Majority of active Facebook users reside in
Egypt, Saudi Arabia, Morocco. Algeria,
UAE, etc.
❖ “Arab Spring” and the recent societal and
political transformations have further
empowered large segments of the MENA
populous to be active on the Social Media
and become “netizens” (Mourtada & Salem,
2012)
Number
of
Facebook
Users
in
Arab
Region
(Source:
www.arabsocialmediareport.com)
15

16. INDUSTRY DATA
❖ A survey revealed 54% of Middle East
users access Facebook more than once a
day (Dubai School of Government, 2013)
❖ Facebook user penetration in the Arab
region was just over 12% by the end of
June 2012 (Dubai School of Government,
2012)
❖ Total number of Facebook users and
Twitter users in the UAE stands at 3.5
Million and 0.36 Million respectively
(Fisheye Analytics, 2013)
❖ At least 67% firms increasing their digital
marketing budgets in the Middle East
indicating the significance of the digital
marketing (Yousafi, 2013) with a vast
majority of the spend attributing to social
media marketing expenditure – 27%
Source:
www.stats.ae
16

17. LITERATURE REVIEW
17
ACADEMIC REVIEW

18. SOCIAL MEDIA MARKETING
❖ Social Media relates to the sharing of information, experiences and
perspectives throughout community-oriented websites (Weinberg, 2009)
❖ One of the major trends that Social Media is accelerating is the shift of
control from companies to customers (PriceWaterhouseCoopers, 2012)
❖ Social Media differentiates itself from traditional media through a dynamic
two-direction mode of communicating (Saravanakumar &
SuganthaLakshmi, 2012)
18
BENEFITS OF USING SOCIAL MEDIA

19. SOCIAL MEDIA MARKETING
❖ Marketers are increasingly using Social Media to gain
benefits through seeking participation from
consumers over the Social Media to co-create their
offerings and communication (Hanna, Rohm, &
Crittenden, 2011)
❖ The tools and strategies for communicating with
consumers have changed significantly with the rise of
Social Media, a new communications paradigm
(Mangold & Faulds, 2009), which must be carefully
addressed by marketers because of its power and
critical nature of discussions among the consumers
❖ Social Media is not just a new technology, but enablers
of a fundamental marketing strategy shift in how
organisations and customers relate to each other
(Angel & Sexsmith, 2009)
19

20. NETWORK EFFECTS
❖ Network effects are positive
externalities through which the welfare
of an individual is affected by the
actions of other individuals without a
mutually agreed-upon compensation
(Easley & Kleinberg, 2010)
❖ Social Media embrace “Network
Effects” which form the basis of making
messages viral and is essential to
determine the value of the network
❖ At its core, the phenomenon of network
effects captures the increase in value
that arises when an additional user
joins the network
20
Value of a network per
Metcalfe’s Law = n2
where n is number of
connections

21. ENGAGEMENT IN SOCIAL MEDIA
❖ Consumer engagement is the will of each consumer (Jakste & Kuvykaite, 2012), which
depends upon the motivation rendered by the brand, to get involved, encouraged or receive
some benefits to engage
❖ Consumer engagement thus refers to the ways in which the consumers engage with brands
through the following mediums:
• Brand’s website
• Blogs
• Social Networking sites
• Videos
• Forums
❖ Social Media Analytics and Statistics firm, SocialBakers, calculates its level of engagement
for Facebook through the following formula:
21

22. FACTORS AFFECTING ENGAGEMENT
1.Trust - Mangold and Faulds (2009) suggest that consumers perceive social media as a more
reliable source of information for the purpose of their decisions than traditional
communication channels which feature one-way communication paradigm by the marketers.
2.Help - Jakste & Kuvykaite (2012) suggest that consumers are motivated to engage with brands
through Social Media to receive help related to their purchase and consumption decision.
3.Regularity of Updates - People who frequently engage with a company in Social Media are
likely to be among that company’s most important customers (Forrester Consulting, 2013).
4.Response to Customer Stories - Most consumers will share brand stories through Social
Media when they have had either a very negative or positive experience (Gensler, Völckner,
Liu-Thompkins, & Wiertz, 2013). The ability of organisation’s to effectively response to such
positive or negative comments shared by their customers would influence the opinion of other
customers.
5.Homophily - Homophily refers to the degree to which pairs of individuals who interact are
similar with respect to certain attributes, such as beliefs, values, education, social statues, etc.
(Rogers & Bhowmik, 1970).
22

23. 6.Informational Influence - Informational influence can be defined as the tendency to
accept information from others as evidence about reality (Deutsch & Gerard, 1955).
7.Content Type - Content or ‘Content Engineering’ seeks to develop content that better
engages the users and drives the desired goals of the marketer from the campaigns
they implement (Lee, Hosanagar, & Nair, 2013).
8.Media Type - The type of media used by the brand influences the level of
engagement for its users (Cvijikj & Michahelles, 2012).
9.Time & Day of Brand Generated Content - Without a clear understanding of
consumers’ Facebook usage patterns, organisations have little chance of maximising
the return on their social marketing efforts (Orcale Cloud, 2012).
10.Community Attributes - Community features involve several measurements of the
community including – size of the community, total number of active users, etc.
(Purohit et al., 2011)
FACTORS AFFECTING ENGAGEMENT
23

24. 11.Appearance - As suggested by Thumsamisorn and Rittippant (2011), the user-friendliness
of the page does influence the overall experience to communicate with the brand.
12.Brand Affinity - The engagement may initiate from brand advocates who are a group of
consumers who not only use a brand but also love it and want to help others to get to know
it (Clancy & Paquette, 2012).
13.Brand Activities - Raghavan (2014) suggests that people may be motivated to engage with
the social media pages of brands to receive regular updates, promotional offers, discounts,
freebies, contests and other such activities that attract users to participate and actively seek
out content posted by the brand.
14.Post Purchase Evaluation - In the consumer decision-making process, the final stage is to
evaluate whether or not were the needs and wants of the consumers satisfied by the
alternative selected, resulting in two potential outcomes – satisfaction or dissonance (Lee E. ,
2013) which provides a source of feedback.
15.Social Influence - The social influence exhibited by the first-degree network of a user may
also drive engagement for Social Media participation with brands.
FACTORS AFFECTING ENGAGEMENT
24

25. RESEARCH METHODOLOGY
25

26. RESEARCH FRAMEWORK
ENGAGEMENT
FACTORS
1. Trust
2. Help
3. Regularity of Updates
4. Response to Customers
5. Homophily
6. Informational Influence
7. Content Type
8. Media Type
9. Time & Day of Post
10. Community Attributes
11. Appearance
12. Brand Affinity
13. Brand Activities
14. Post-purchase Evaluation
15. Social Influence
26

27. QUALITATIVE RESEARCH
27

28. EXPERT OPINIONS
Interview 1:
Interviewee - Ms. Seena Raghavan
Designation - Social Media Manager, BeUnique
Group
Key Inferences:
❖ Biggest tool to raise awareness of a brand
today
❖ Ideal engagement rate 10-15%
❖ In the UAE, among National Arabs, the
most effective tool is Instagram. Among
Expats, it’s Facebook
❖ Creativity, Engaging posts, images, videos
and creating a relationship with the fans
are critical for success in Social Media
Interview 2:
Interviewee - Mr. Gaurav Aidasani
Designation - CEO, COSMOS Star Consultants
Key Inferences:
❖ Promotions, discount vouchers,
informative advertising within the
group, and news/upcoming drives
are ways of leveraging social media
for marketing
❖ Engagement depends upon 3 major
factors - Content. Content. Content.
Also, promotions/competitions.
❖ Ideal engagement rate - 10%
28

29. CUSTOMER DISCUSSIONS
29
❖ Most of the consumers do not actively engage on the social media pages
of brands, despite being active users of Social Media
❖ The primary way that consumers participate on the social media pages of
brand is through hashtags, shares and likes
❖ The customers showed a tendency to read comments and content shared
by other customers on Social Media before their purchase
❖ Consumers are influenced to engage on the social media page of a brand if
they see their friends liking the pages
❖ Consumers would have a greater tendency to participate on social media
pages of brands if they see regular brand generated content in the form of
photos and videos

30. QUANTITATIVE RESEARCH
30

31. RESEARCH METHODOLOGY
PURPOSE:
The purpose of conducting quantitative will provide us with an analysis of the
following:
1. Determine the factors that drive consumers to engage on Social Media and
subsequently profile the consumers based on the identified variables.
2. Analyse the current engagement level of the Starbucks Middle East Facebook
through Social Media Analytics.
TECHNIQUES:
1. Factor Analysis
2. Cluster Analysis
3. Cross-Tabulation
4. Social Media Analytics (SimplyMeasured & SocialBakers)
31

32. 1. FACTORS THAT DRIVE
ENGAGEMENT
32

33. FACTOR ANALYSIS
KMO and Bartlett's Test
Kaiser-Meyer-Olkin Measure
of Sampling Adequacy. 0.739
Bartlett's Test of Sphericity Approx.
Chi-
Square
532.010
df
153
Sig.
0.000
SAMPLE:
73 Respondents
SAMPLING TECHNIQUE:
Convenient Sampling
DATA COLLECTION:
1. Online Survey
I. To gauge the behaviour of users who engaged with Starbucks Facebook
page.
II. To gauge the behaviour of individuals who are likely to consume products
of Starbucks.
2. Offline Survey - To gauge the behaviour of individuals who are likely to
consume products of Starbucks.
33

34. FACTOR ANALYSIS
Rotated Component Matrix
Component
1 2 3 4 5 6
Negative_Feedback_Others 0.827
OthersFeedback 0.808
OpinionsOfOthers 0.793
Brand_Response_Others 0.708
Empathy
Read_Posts 0.873
See_Posts 0.775
FollowPages 0.729
Regularly_Post 0.710
ParticipationOnPreferredBran
ds
0.763
Social_Influence 0.758
Appearance
ShareNegativeExperience 0.854
SharePositiveExperience 0.716
AskHelp 0.714
ContentLiking
ReadOthersPosts
Timing 0.840
1. Influence of Other Customers
2. User’s Participation
3. Brand Affinity & Social
Belongingness
4. Willingness to Share Experience
5. Seek help
6. Timing of Brand Generated Post
34

35. CLUSTER ANALYSIS
!0.4%
!0.3%
!0.2%
!0.1%
0%
0.1%
0.2%
0.3%
0.4%
1.%Influence%of%Other%Customers%
2.%User's%Par<cipa<on%
3.%User's%Brand%Affinity%and%Social%
Influence%to%Engage%
4.%Feedback%based%on%user's%
experience%
5.%Willingness%to%ask%queries,%help,%
ques<ons%
6.%Time%of%brand%generated%post%
CLUSTER 1
35
1.Time of brand
generated post
2.Willingness ask queries,
help and questions

36. CLUSTER ANALYSIS
!0.8%
!0.6%
!0.4%
!0.2%
0%
0.2%
0.4%
0.6%
0.8%
1.%Influence%of%Other%Customers%
2.%User's%Par=cipa=on%
3.%User's%Brand%Affinity%and%Social%
Influence%to%Engage%
4.%Feedback%based%on%user's%
experience%
5.%Willingness%to%ask%queries,%help,%
ques=ons%
6.%Time%of%brand%generated%post%
CLUSTER 2
36
1. Influence of Other Customers
2. User’s Participation
3. User’s Brand Affinity and
Social Influence
4. Ability to provide feedback
based on user’s experience.

37. CROSS TABULATION
Particulars Cluster 1 Cluster 2
DEMOGRA
PHICS
Country
Predominantly UAE and
Other Countries
Predominantly UAE and
Other Countries
Age Between 21-30 Dominant in 21-25
Profession Students and Professionals Dominantly Students
ACTIVE ON
WEBSITES
FACEBOOK Dominantly active
Twitter Pre-dominantly not active Pre-dominantly active
Instagram Partially active Pre-dominantly active
LinkedIn Partially active Dominantly active
WEBSITES
VISITED
DAILY
Social Networking Dominantly active
Photo-Sharing Partially active Dominantly active
News Dominantly active Pre-dominantly not active
FOLLOW
STARBUCKS
Facebook Page Majority Minority
37

38. 2. SOCIAL MEDIA ANALYTICS
38

39. DISTRIBUTION OF FANS
39

40. STARBUCKS FACEBOOK ANALYTICS
Following are the engagement results for Starbucks Middle East page for the period
26th July 2014 to 8th August 2014:
Overall engagement rate as a percentage of fans = 0.7%
40

41. STARBUCKS FACEBOOK ANALYTICS
❖ Starbucks although has the highest engagement
rate when compared with its competitors
❖ However, it had the least number of brand posts
for the period
❖ 97% engagement was in the form of “likes”
which is the easiest form of engagement for the
user
❖ Generated by Starbucks were only in the form of
“photos”
Following are the engagement results for Starbucks Middle East page for the period
26th July 2014 to 8th August 2014:
41

42. STARBUCKS FACEBOOK ANALYTICS
❖ Starbucks does not allow its users to “create” a post of
their own on the Facebook page of Starbucks Middle
East
42

43. SIGNIFICANT INSIGHTS
❖ Starbucks maintains a single social media page for its entire Middle Eastern
population
❖ It does witness highest number of followers however the engagement is at
an alarmingly low level of < 1 %
❖ 97% engagement comes through “likes” which is not a true reflective of the
user’s true opinion/expression
❖ Primary data reveals a high skewness of certain users towards asking help,
queries and sharing feedback based on their experience
❖ By not allowing users to create posts by themselves, Starbucks, has severely
limited the users’ ability to express & listen
❖ Limiting the form of communication - “photos”, further limits the ability of
Starbucks to engage its Middle Eastern population
43

44. BOTTOMLINE
❖ Our analysis reveals significant deficiencies in the Social Media
presence of Starbucks Middle East
❖ Given the high importance of Social Media in today’s world,
Starbucks has limited its reach and scope by not deploying
effecting Social Media Marketing Strategies which attributed to
its success in the western countries
❖ For its UAE Customers, Starbucks is advised to create
dedicated Social Media pages which enhance its Social Media
presence and engage the customers to take the Starbucks
experience online
44

45. STRATEGIC
RECOMMENDATION
Dedicated Social Media Pages for UAE
Consumers / Localisation
45

46. Starbucks
UAE
Cost of creating a Facebook fan-page = 0
ELIMINATING GEOGRAPHY OVERFITTING
STARBUCKS UAE
46

47. GLOBAL AND MIDDLE EAST
❖ The current Social Media Strategy for Middle East mimics the content posted by
Starbucks Facebook Fanpage for its American consumers along with original content
❖ Middle Eastern, or specifically UAE, consumers may not connect with such posts
47

48. STARBUCKS UAE FACEBOOK FANPAGE
❖ Facebook allows brands to
formulate “global pages” which
allow international brands to
maintain a single fanpage with
localised experiences for users in
different countries1 (Darwell,
2012)
❖ A dedicated page for the UAE
consumers would help Starbucks
to reach out exclusively to its
UAE disappear
1http://www.insidefacebook.com/2012/10/17/facebook-launches-global-pages-for-brands-to-offer-localized-experiences/
48

49. STARBUCKS UAE FACEBOOK FANPAGE
AWARENESS ENGAGEMENT
49

50. 1. AWARENESS
50

51. DEVELOPING AWARENESS
1.Online Campaign to promote the Starbucks UAE Facebook Page
UAE Features the maximum Facebook penetration rate - 45.38%1
1SOURCE : http://interactiveme.com/2011/02/facebook-statistics-in-the-mena-region/ 51

52. CLUSTER 1
Total Cost = DHS 1,1201
Potential Reach - 540,000 people1
1SOURCE : www.facebook.com 52

53. CLUSTER 2
Total Cost = DHS 2,8001
Potential Reach - 460,000 people1
1SOURCE : www.facebook.com 53

54. DEVELOPING AWARENESS
2. Offline Campaigns to promote the Starbucks UAE
Facebook Page
UAE
I like
UAE
I like
54

55. FORECASTED RESULTS
Mode Reach Cost Cost Per Person
Online 1 540,000 * 0.05 =
27,000
1,120 0.041
Online 2 460,000 * 0.05 =
23,000
2,800 0.122
Offline 5000 5000 1
Total 55,000 8,920 0.162
❖ Cost of acquiring a “like” is significantly low
❖ Additional online/offline promotions are advised
❖ A Starbucks’ coffee typically contains an 80%1
markup including the fixed
cost recovery and variable costs
❖ Thus, for a coffee retailing at Dhs 20 contains approximately Dhs 5-6 of net
profit
Source: http://www.marketwatch.com/story/what-starbucks-7-coffee-is-really-worth-2012-11-2955

56. 2. ENGAGEMENT
56

57. CAMPAIGN OUTLINE
❖ Incite users to follow the Social
Media Page
❖ Incite users to engage,
participate and interact with
the brand
❖ Provide means to - Read other
users experience, provide own
feedback and read brand
related content
❖ Motivate users to share their
content with others
UAE
I like
Follow. Read. Create. Share.
57

58. CAMPAIGN EXECUTION
❖ Intention of the campaign is not to sell but to strengthen the
relationship between Starbucks and its Customers through
enhance the Customer Lifetime Value (CLV)
❖ Consumers would typically be asked to share their Starbucks
experience in UAE through the means of pictures and videos
❖ Sharing content reflects the users affinity towards Starbucks
and provides them an opportunity to communicate feedback
❖ Starbucks would continue to provide content that does not
sell but enhances customer experience
58

59. NETWORK EFFECTS
USER POSTS
EXPERIENCE
MORE USERS JOIN TO
READ CONSUMER
GENERATED
CONTENT
❖ Our data analysis reveals that users engagement depends on the
ability to read others opinions, comments, feedback and experience
❖ This would help us create network effects for the facebook fanpage of
Starbucks UAE to engage more and more customer
59

60. TARGETED FEATURES
!0.4%
!0.3%
!0.2%
!0.1%
0%
0.1%
0.2%
0.3%
0.4%
1.%Influence%of%Other%Customers%
2.%User's%Par<cipa<on%
3.%User's%Brand%Affinity%and%Social%
Influence%to%Engage%
4.%Feedback%based%on%user's%
experience%
5.%Willingness%to%ask%queries,%help,%
ques<ons%
6.%Time%of%brand%generated%post%
!0.8%
!0.6%
!0.4%
!0.2%
0%
0.2%
0.4%
0.6%
0.8%
1.%Influence%of%Other%Customers%
2.%User's%Par=cipa=on%
3.%User's%Brand%Affinity%and%Social%
Influence%to%Engage%
4.%Feedback%based%on%user's%
experience%
5.%Willingness%to%ask%queries,%help,%
ques=ons%
6.%Time%of%brand%generated%post%
❖ Based on our cluster analysis the campaign would achieve the following:
1. Provide means to ask queries, help and questions regarding Starbucks and its products.
2. Feature the feedback and experience of customers.
3. Ability to read, comment, share and/or like other users content.
4. Gauge the timing that generates maximum engagement to post content at the the time
which is likely to result into maximum engagement.
60

61. IMPACT ON BOTTOMLINE
❖ Provide an opportunity to communicate and listen specifically to the target
segment
❖ The aggregate result of the proposed activities would enhance the overall
Starbucks experience for the UAE customers
❖ Co-relating the efforts of Social Media Marketing to the profit bottomline would
be an unfair comparison and thus needs to be accounted for - brand loyalty,
repeat purchases, customer experience, satisfaction, advocacy, engagement, etc.
❖ Starbucks UAE customers would actively immerse themselves into the Starbucks
online experience
61
Brand Loyalty, Awareness, Experience Enhancement and Engagement through
Social Media would help Starbucks to enhance its profitability in UAE

62. –Thank You
“Time for a coffee?”
62