市場(chǎng)學(xué)Essay范文：An analysis of Starbucks using Game Theory
本文是市場(chǎng)學(xué)專業(yè)的Essay范例，題目是“An analysis of Starbucks using Game Theory（用博弈論分析星巴克）”，星巴克公司是一家美國跨國咖啡公司和咖啡連鎖店，在全球擁有超過2萬家門店，其中大部分位于美國，是世界上最大的咖啡館。
星巴克的名字靈感來自赫爾曼·梅爾維爾的經(jīng)典小說《白鯨記》中的大副。該公司的使命是“激發(fā)和培育人類精神——一次一個(gè)人，一杯酒，一個(gè)社區(qū)”。(1)星巴克在世界各地出售冷熱飲料(如咖啡)，以及其他食品(如糕點(diǎn)、零食)和星巴克商品(如馬克杯和杯子)。該公司的許多產(chǎn)品是根據(jù)商店的位置定制的，該公司的娛樂部門負(fù)責(zé)圖書、音樂和電影的營銷。自1971年成立以來，公司的銷售額和收入迅速增長(zhǎng)。從1987年開始，該公司平均每天開設(shè)兩家門店，這是該公司成功的標(biāo)志。
Starbucks Corporation is an American multinational coffee company and cafe chain with over 20,000 stores across the world, the majority of which are located in the United States, making it the largest coffeehouse in the world. Starbuck’s name is inspired by the character of the first mate in the Herman Melville’s all-time classic novel Moby Dick. The mission of the company is to ‘to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time’. (1) Starbuck cafes across the world sell hot and cold beverages such as coffees along with other food items such as pastries, snacks and Starbucks merchandise such as mugs and tumblers. Many of the company’s products are custom to the location of the store and the entertainment division of the company deals with marketing of books, music and movies. Ever since the company was founded in 1971, it has been growing rapidly in sale and revenues. The fact that the company has opened an average of two stores per day since 1987 is a glowing beacon of the success of the company. (2)
Starbucks first ventured into the United Kingdom when it acquired 65 coffee stores of the Seattle Coffee Company in May of 1998. (3) Today, the company serves millions of customers every day with a presence in over 50 countries around the world. Coffee is bought by the company’s coffee buyers personally travelling to the Latin America, Africa and Asia to seek out the best quality of coffee beans available and finished products are produced though Starbuck’s signature Roast enriching the flavor and balance of the coffee. The company’s first public offering was in the 26th of July 1996 and it has been listed on the NASDAQ ever since.
1998年5月，星巴克收購了西雅圖咖啡公司的65家咖啡店，首次進(jìn)軍英國。(3)今天，該公司每天為數(shù)百萬客戶服務(wù)，業(yè)務(wù)遍及全球50多個(gè)國家。咖啡由公司親自前往拉丁美洲、非洲和亞洲的咖啡采購員購買，以尋找最優(yōu)質(zhì)的咖啡豆，并通過星巴克的招牌烘焙來豐富咖啡的風(fēng)味和平衡。公司首次公開募股是在1996年7月26日，此后一直在納斯達(dá)克上市。
Here in this report, we investigate the use of games theory and simulation to evaluate and test the application of strategic leadership at Starbucks. The report also aims to critically evaluate game theory and the appropriateness of the same in the evaluation of options for strategic change/transformation.
GAME THEORY博弈理論
Game theory in simple terms is the way in which a group of intelligent individuals interact and associate with each other to achieve their own goals. A game can be described as activities that people perform for either material gain or pleasure and game theory can be defined as the study and analysis of the strategic interaction between the individuals involved in the game. A game typically contains three elements: the players of the game, the strategies applied by the players and the consequences of the decisions made by each of the players. Game theory is the study and analysis of challenging scenario and using the game situations to aid in the decision making process.
簡(jiǎn)而言之，博弈論就是一群聰明的個(gè)體為了實(shí)現(xiàn)自己的目標(biāo)而相互影響和聯(lián)系的方式。游戲可以被描述為人們?yōu)榱双@得物質(zhì)或樂趣而進(jìn)行的活動(dòng)，博弈論可以被定義為研究和分析參與游戲的個(gè)體之間的戰(zhàn)略互動(dòng)。游戲通常包含三個(gè)元素:游戲中的玩家，玩家所使用的策略以及每個(gè)玩家所做決定的結(jié)果。博弈論是對(duì)具有挑戰(zhàn)性的情景的研究和分析，并利用游戲情境來幫助決策過程。
A strategy can be described as being strictly dominant, if the player ends up earning a higher payoff than any other related strategy regardless of what any of the other players do. In essence, the strategy that gives a player the highest payoff is called a strictly dominant strategy. A number of simple games can be solved by using this strategy. While using this strategy, the player analyses and compares the different strategies to decide which one of them gives the better payoff. A strategy is said to be strictly dominated, if there always exists another strategy that gives a better or same payoff compared to any other strategy for a player.
While strictly dominant strategies are powerful tools that can be used to change the flow of the game in the player’s favour, isolating the strategies and applying them to particular situations is rather difficult due to the large volumes of information that may be present. In order to identify the dominated strategies, one must be focused on the players payoff’s at the moment and mentally block out the irrelevant payoffs and strategies and isolate the relevant ones. One way to do this is to perform continuous elimination strictly dominated strategies. Once a strategy has been identified as strictly dominated, it is a rational idea not to use it since there is always a strategy better than it. By iterating this procedure, one may be able to isolate the strictly dominant strategy.
Game theory can be of great help in solving real life situations through the translation of the situations to gaming models and applying game theory on them. Some of the games that may be applicable in real life situations are as follows.
Prisoner’s Dilemma囚徒困境
Prisoner’s Dilemma is a classical example of a game in game theory strategy which shows why two entities, be it organizations or individuals do not cooperate with each other even through doing so will bring both of them major benefits. The formal definition of the game as defined by Albert W. Tucker is as follows:
囚徒困境是博弈論策略中一個(gè)經(jīng)典的博弈例子，它說明了為什么組織和個(gè)人這兩個(gè)實(shí)體不合作，即使這樣做會(huì)給雙方帶來很大的利益。Albert W. Tucker對(duì)游戲的正式定義如下:
“Two members of a criminal gang are arrested and imprisoned. Each prisoner is in solitary confinement with no means of speaking to or exchanging messages with the other. The police admit they don’t have enough evidence to convict the pair on the principal charge. They plan to sentence both to a year in prison on a lesser charge. Simultaneously, the police offer each prisoner a Faustian bargain. If he testifies against his partner, he will go free while the partner will get three years in prison on the main charge. Oh, yes, there is a catch … If both prisoners testify against each other; both will be sentenced to two years in jail. (4)”
The game is used to demonstrate how the distrust and completion of the individual parties towards each other may result in the worst possible option being forced upon each of them. This particular game can be applied to a number of commercial organizations such as ASDA and other chain supermarkets where are there are constant price wars or some other kinds of competition. Another relevant example is that of intense animosity between countries such as Indian and Pakistan, leading to an Arms Race, draining both of the countries’ resources and causing currency instabilities.
Sequential Game順序游戲
A sequential game is a game in game theory where a player chooses his strategies sequentially. In this form, a player has information on the strategy that the other player has chosen before he does make his move. Thus, the sequential games have a time axis and are determined and affected by the other player’s moves. This evidently implies that the player to make the first move has the power to influence the moves of the other players in the future since each player decides on the strategies they have available at the hand and the actions of the first player therefore influence their moves.
在博弈論中，順序博弈是指參與者按順序選擇策略的博弈。在這種形式中，玩家在采取行動(dòng)之前就掌握了其他玩家所選擇策略的信息。因此，順序游戲有一個(gè)時(shí)間軸，并由其他玩家的移動(dòng)決定和影響。這顯然意味著，邁出第一步的玩家有能力影響其他玩家在未來的行動(dòng)，因?yàn)槊總€(gè)玩家都決定自己手中的策略，而第一個(gè)玩家的行動(dòng)因此會(huì)影響他們的行動(dòng)。
A classic example of a real life true sequential game is that of chess, where each player takes turns in developing their strategies according to the moves made by that of his opponent. These games can be easily represented by payoff matrices and can be solved through backward induction. Another example of a common sequential game in application to real life is auctioning where each of the participants raise their auction amount based on the previous participant’s decision.
Simultaneous Game同時(shí)游戲
Simultaneous games are played when each player makes his decisions without knowing the decisions or actions of the other players. In essence, simultaneous games contrast the sequential games in every sense of the word. For instance, simultaneous games do not have a time line and the actions of the players are not affected by that of each other.
當(dāng)每個(gè)玩家在不知道其他玩家的決定或行動(dòng)的情況下做出自己的決定時(shí)，這就是同步游戲。從本質(zhì)上講，同步游戲與順序游戲在各個(gè)方面都存在差異。例如，同步游戲沒有時(shí)間線，玩家的行動(dòng)不受其他玩家的影響。
An example of a true simultaneous game is rock paper scissors with each of the players taking decisions independent of each other. Normal Forms are the chosen forms of representations for simultaneous games. Bidding is another classing example of a real life simultaneous game where the participants chose their investments irrespective of what the other may have chosen.
Ultimatum Game最后通牒游戲
In game theory, ultimatum game is played between two players who have been given a specific amount of money to be divided among them. During the game, the first player makes a proposal on how to divide the cash and the second player can respond by wither accepting or rejecting the proposal. If the second player chose to accept the proposal, each of the players receives a sum of money as proposed by the first player. However, if he does not accept, neither player gets anything. This game was developed in the year 1982 by Güth, Schmittberger, and Schwarze and is often used in economic experiments.
在博弈論中，最后通牒博弈是在兩個(gè)參與者之間進(jìn)行的，他們得到了一定數(shù)量的錢來分配。在游戲中，第一個(gè)玩家提出如何分配現(xiàn)金的建議，而第二個(gè)玩家可以選擇接受或拒絕這個(gè)建議。如果第二個(gè)玩家選擇接受這個(gè)提議，那么每個(gè)玩家都會(huì)收到一筆由第一個(gè)玩家提議的錢。然而，如果他不接受，雙方都得不到任何東西。這個(gè)游戲是由Güth、Schmittberger和Schwarze在1982年開發(fā)的，經(jīng)常用于經(jīng)濟(jì)實(shí)驗(yàn)。
Dictator Game
The dictator game, as the name suggested is dominated by dictator and the rest of the players are merely silent partners. It is similar to the ultimatum game in some senses; however, the role of the players other than the dictator is entirely passive. In the dictator game, the main player, i.e. the dictator proposes the division of some endowment for example, a resource such as the market share or cash prize. The rest of the players, the respondents, have no choice other than to accept the division and make do with whatever resources are left remaining by the dictator. Unlike the Ultimatum game, here the role of the respondent is entirely passive.
Hotelling Game霍特林的游戲
Hotelling game in game theory is a form of competition in which two rivalling companies choose the location of their business or the prices of their goods according to that of the competitor. The game is based on the observation that by matching the location or the price of the competitor, each player cuts into the market share of their rivals and also improves on their own shares and revenues.
霍特林博弈在博弈論中是兩家競(jìng)爭(zhēng)公司根據(jù)競(jìng)爭(zhēng)對(duì)手的地理位置或商品價(jià)格來選擇經(jīng)營地點(diǎn)或商品價(jià)格的一種競(jìng)爭(zhēng)形式。這款游戲是基于這樣的觀察:通過匹配競(jìng)爭(zhēng)對(duì)手的位置或價(jià)格，每個(gè)玩家都可以削減競(jìng)爭(zhēng)對(duì)手的市場(chǎng)份額，同時(shí)提高自己的份額和收入。
GAME THEORY AT STARBUCKS
Starbucks enjoyed an unprecedented growth in its early years growing from a minor local store located in Seattle to an internationally giant of coffeehouses across the world due to a number of well organized and managed executive decisions. However, in the recent years, their growth has slowed down and the company was forced to close down around 300 stores since the year 2008. This may be due to the splitting of the market share by the emerging competitors such as McDonalds, who have introduced McCafes as their foray in to the coffee business. The two companies have been doing rather well in the past few years by using different strategies. In the following sections we try to investigate and explore how the different games and game theories are applicable with respect to the competition of these companies and examine how Starbucks rose to power.
Application of Hotelling Law/Linear City Model霍特林定律/線性城市模型的應(yīng)用
The rapid expansion of Starbucks can be attributed to the application of the strategies of the Linear City Model or Hotelling Law. When Starbucks entered the local markets with a local competitor, as depicted below. Considering the market is uniquely distributed, the competitor is located in the middle, allowing them to harness maximum profits. Thus convenience is the competitor’s only advantage and with the closer the Starbucks retail shop, measured by x, is to the competitor, more market share it can gain.
星巴克的迅速擴(kuò)張可以歸因于線性城市模型或霍特林定律的策略應(yīng)用。當(dāng)星巴克與當(dāng)?shù)馗?jìng)爭(zhēng)對(duì)手進(jìn)入當(dāng)?shù)厥袌?chǎng)時(shí)，如下圖所示。考慮到市場(chǎng)的獨(dú)特分布，競(jìng)爭(zhēng)對(duì)手位于中間位置，使他們能夠利用最大的利潤。因此方便是競(jìng)爭(zhēng)對(duì)手唯一的優(yōu)勢(shì)，用x來衡量，星巴克零售店離競(jìng)爭(zhēng)對(duì)手越近，它就能獲得更多的市場(chǎng)份額。
With the location and convenience being the only factors of concern, if the company opens a shop just .1 miles away from the competitor, it will gain 47.5% of the customers. However, aside from the convenience the brand armed with the Starbucks experience’ and brand name, attracts more customers with its coffee being attractive to the consumer approximately around $1 a cup. Representing the Starbucks experience cost as transportation cost t, and the coffees valued at $3 and $2.5 at Starbucks and the local competitor respectively, the customer valuing a cup of coffee worth $4, he evaluates his buying decision as follows:
Customer Utility Starbucks: WTP – (PS) = $4.0 – ($3.0) = $1.0
Customer Utility Coffee Shop: WTP – (Pc + [1-x] t) = $4.0 – ($2.5 + [1-.1]*$1.0) = $0.6
Through this example, one can demonstrate how the ‘Starbucks experience has allowed the company to take over the local markets by capturing over 70% of the market share. With no clear competition, the company was able to effectively expand at will and take out the local coffee houses. Also the company tried to centralize itself at the local customer bases to maximize the profit. In this situation, a new competitor intending to open a new store would have to open the store to either side of store and thus would gain only less than half the market share.
Now, considering the situation where a Starbucks store located is located about half a mile away from the centre of the customer base ie x=.5. Now, considering all the factors the same as above, the customer evaluation would be:
Customer Utility Starbucks: WTP – (P + x1t)” $4.0 – ($3 + .5*$1.0) = $.50
This implies that a new store can take over the market share as long as their location is less than that of Starbucks. This is one of the reasons why there was a phenomenon where the Starbucks stores clustered towards each other. By increasing the strategic location of their stores, the company was able to maximize their profits. In this situation, the best option available for a new store is to locate to the centre of the micro-market at x=0, splitting the market.
However with the Starbucks stores clustering towards each other with the term now known as ‘Starbucks in every corner’, the situation is a major deterrent to the entrepreneurs from opening new stores. The company in its clustering split its profits among the stores with the existing ones closing down and moving away, maintaining the Nash Equilibrium and playing their best responses.
Sequential game at Starbucks with respect to McDonalds Coffee shop proposal接下來的游戲是關(guān)于星巴克關(guān)于麥當(dāng)勞咖啡店的建議
While the company enjoyed a monopoly in the coffee business for a long time, the entering of McDonalds into the coffee industry affected the company’s profits significantly. The coffee market in the US was valued at around $1 billion by the company and the cost of future sales was estimated to around $100,000 per store. This situation can be described in game theory as follows.
雖然公司在咖啡業(yè)務(wù)上長(zhǎng)期享有壟斷地位，但麥當(dāng)勞進(jìn)入咖啡行業(yè)對(duì)公司的利潤影響很大。據(jù)該公司估計(jì)，美國的咖啡市場(chǎng)價(jià)值約為10億美元，每家店未來的銷售成本約為10萬美元。這種情況可以用博弈論描述如下。
Game: McDonalds’ entry decision in 2007
Actions: McDonalds’ – entry v. no entry, Starbucks – accommodate v. fight (drop prices)
Payoffs: profits are limited by the maximum portion of Starbucks revenues vulnerable to attack i.e. price sensitive and non-loyal customers.
Look Forward Reason Back: McDonald’s enters, Starbucks responds
Adjusting the 80/20 rule to 80/25, the loyal customers of the company are approximated at around $4.85 billion. While assuming that the spending habits of the rest of the customers as the same, only around $1.2 billion of the sales would come from the non-core. With the records showing that around 37% of coffee drinkers being non-loyal customers, the company stands to lose around 10% of their revenues if the non-loyal consumers switched offer to the McCafes. Considering this over a period of 5 years, the payoff to the business for accommodation would be to lose around $1,944 million in revenues.
However, if the corporation chose to fight the fast food chain by reducing their prices to an average of 2.25 per cup of coffee from $3.50 and assuming that the average transaction costs around $3, it would a significant amount of revenues from the existing customers by around 24% per year. Projecting this to a five year period, and considering that the market share of the company is fixed, the company stands to lose around $4,801 millions.
Clearly, from these figures, the best option for the company, if McDonalds decides to enter the coffee industry, is to accommodate the newcomer, since opposing it would cost the company a lot more if it chooses to fight by cutting the prices of its products. Thus, in the case where McDonald’s enters the market, the strictly dominant strategy of the company is to work towards accommodating the new competitor.
Look Forward Reason Back: McDonald’s does not enter, Starbucks responds
However, if McDonald’s defers from entering the market, the company would maintain its status, holding on to its non-loyal customers and no loss of revenues would occur. This implies that as long as McDonald’s chooses not to enter the market, the company can keep its customer base, and the payoff would be zero. Another option is for the company to lower its process in case of a threat to the customer base, and then the payoff using the above calculations would be $4.8 billion. Thus the dominant strategy that the company can take is to do nothing and accommodate McDonald’s on its entry to the market if the company chooses to do so since the lowering of the prices is not worth the competition and loss of customers in accordance with the fall of revenues.
Look Forward Reason Back: McDonalds’ decision回顧原因:麥當(dāng)勞的決定
Considering that the best option for Starbucks is to accommodate McDonald’s, the decision to make for McDonald’s is to decide if they could generate enough revenues in the business. In 2007, according to a statement by McDonald’s, it believes that it can generate up to $1billion in annual sales with a $100,000 investment into coffee equipment & training. Assuming that the market does not grow, extrapolating the data to five years, the payoff to McDonald’s would be a minimum of $200 million. As this data does not include the non-loyal customer base of Starbucks, this is the worst case scenario for McDonald’s.
考慮到星巴克最好的選擇是容納麥當(dāng)勞，麥當(dāng)勞的決定是決定他們是否能在業(yè)務(wù)中產(chǎn)生足夠的收入。2007年，根據(jù)麥當(dāng)勞的一份聲明，該公司認(rèn)為，如果在咖啡設(shè)備和培訓(xùn)上投資10萬美元，其年銷售額可達(dá)10億美元。假設(shè)市場(chǎng)沒有增長(zhǎng)，根據(jù)數(shù)據(jù)推算5年，麥當(dāng)勞的收益至少將達(dá)到2億美元。由于這個(gè)數(shù)據(jù)不包括星巴克的非忠實(shí)顧客基礎(chǔ)，這是麥當(dāng)勞最糟糕的情況。
As the situation is only profitable to the company, McDonald’s has chosen to open over 14,000 locations in the US, aiming to cut in to the Starbucks customer base.
CONCLUSION結(jié)論
While Starbucks and McDonalds have been able to coexist in the industry, McDonald’s has been gradually cutting into the Starbucks market share. For Starbucks to survive, they will need to combat these strategies. Simply trying to hold on to the premium market will prove to be a futile attempt to retain share, as McDonalds and others have means to access the channel. While Starbucks is attempting to diversify income by diving deeper into the grocery retail market, they will still need to invest in efforts to not only retain existing customers, but be able to attract value customers without sacrificing profitability.
在星巴克和麥當(dāng)勞能夠共存的同時(shí)，麥當(dāng)勞也在逐漸蠶食星巴克的市場(chǎng)份額。星巴克要想生存下去，就必須與這些策略作斗爭(zhēng)。僅僅想要保住高端市場(chǎng)將被證明是徒勞的嘗試，因?yàn)辂湲?dāng)勞和其他公司有辦法進(jìn)入這個(gè)渠道。雖然星巴克正試圖通過深入雜貨店零售市場(chǎng)來實(shí)現(xiàn)收入多元化，但他們?nèi)孕枰度刖Γ粌H要留住現(xiàn)有客戶，還要在不犧牲盈利能力的情況下吸引價(jià)值客戶。
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