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Starbucks' Expansion in the Global Market

  • Writer: Vanessa Lau
    Vanessa Lau
  • Nov 10, 2018
  • 2 min read

Updated: Nov 11, 2018

Starbucks Reserve Roastery in Milan

The coffee giant Starbucks have been revealing various ambitious plans on it's expansion on the local US market, the China market that has almost no competitors and the newly opened Starbucks in Milan, Italy that Howard Schultz had in his vision since 30 years ago. Reading about all the plans Starbucks has coming sounds exciting, but I am wondering if the image shift from a basic American coffee shop to a sophisticated Roastery or coffee bar will be successful in the long run.

A lot of American customers get their daily usual or their PSL (Pumpkin Spice Latte) from their local Starbucks before work. Given that before Starbucks no one knew that there is such a huge market for more expensive take out coffee, the biggest competitor in the coffee industry definitely knows how to attract loyal customers. But now that Starbucks have been opening sophisticated stores like the Starbucks Reserve Roastery in Milan, which also serve cocktails and pizza, customers will be seeing a different side of the brand. Hopefully, this change will not become an obstacle for Starbucks as they continue to market to their loyal and new customers.

New Roastery in Shanghai

In an article from the Fortune website, it mentions that Starbucks has a plan to open a store every 15 hours in China for 4 years. Given that the coffee drinking culture in China is not as mature as it is in the US while the e-commerce market there is growing rapidly, Starbucks is taking a different approach and announced that there will soon be new program for mobile ordering and delivery in the China market, and the store locations will be in casual meeting spots rather than the busiest spots in cities and towns like those in the US. The dream of having a coffee shop like the new Roastery in Milan has actually been the dream of CEO Howard Schultz since 30 years ago when he experienced the coffee drinking culture in Milan himself, he says “In each shop I visited I began to see the same people and interactions, and it dawned on me that what these coffee bars had created, aside from the romance and theater of coffee, was a morning ritual and a sense of community”.

I think my perception of Starbucks is definitely different from what Schultz described but I can see the direction that he wants Starbucks to go in the future. Especially from the "place" and "product" pieces in the marketing plan, Schultz wants to deliver the kind of educated, artistic and enjoyable atmosphere to his customers, and to make sure that the customers come back, different channels of marketing such as the website, mobile app and reward program will have to change according to that direction.

 

 
 
 

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