Case Study #1: Starbucks

1196 words 5 pages
Case Study 1: Starbucks

1. What are the barriers facing Starbucks as they try to “teach” people to change their consumption habits from tea and instant coffee?
a. China is country with a population of about 1.3 billion people. It is considered a tea-drinking nation rather than a coffee-drinking nation. This is partly due to the benefits that tea is believed to offer, which include medicinal qualities that coffee does not have. As a result, Starbucks has the barrier of tradition in their way. Chinese people are set in their ways with drinking tea and it will be difficult to sway them towards drinking coffee. There is also the barrier of competition including the “fresh-ground” market including coffees from Hong Kong, Canada, the
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Relative Advantage Low Lower price, advertise high quality product, show how its better than generic/instant coffee
7. Complexity Low Use knowledgeable employees
8. Observability Med Extensive advertising, get people talking
9. Trialability Easy Free samples, use a lot of small distribution outlets, offer special prices
10. Perceived risk Low Guarantees, Show that people value the product and taste

5. Based on your analysis in Question 4, what can Starbucks do to successfully encourage greater coffee consumption? Develop an advertising campaign that not only would encourage greater coffee consumption in general, but also more demand for Starbucks. Specify key themes, copy points, and visuals.
a. Starbucks should show its enthusiasm for localization by combining traditional ideas from the community to the western image of the franchise. Such as have specials for Chinese holidays to help give the consumers a more personal connection to Starbucks. Also give out free samples around the business districts of major cities, with things such as buy one get one free coupons to help awareness among the population. Also a campaign of showing business men and ‘cool’ kids drinking the coffee on their way to work or school will help reinforce the image of a western lifestyle as well as associate Starbucks with wealth and status. 6. Develop and marketing strategy for taking Starbucks into


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