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Global Marketing

Starbucks’ International Market Communications in China

Communicating properly with your target audience is extremely important when a company takes its product or services internationally. One must consider a variety of angles including: global advertising and culture, setting the global advertising budget, creative strategy, global media decisions and advertising regulations. With all of this comes a strong understanding of the cultures you are entering and the nuances you will need to account for. 

Starbucks is an example of a company that utilized many resources into identifying their place in the international market. One example of their success in this area is when they entered the Chinese market. Starbucks sought out market research to understand Chinese markets and, furthermore, the way that capitalism functions in the People's Republic of China (PRC). This was especially important since “China contains a number of distinct regionally-based markets, a factor that makes market research crucial to launching new stores and franchises in China,” (Devault, 2018). Starbucks came up with an entry strategy that would not only target dominant Chinese markets, but also respect the culture of China.

(Starbucks in Chengdu)

A few of Starbucks’ strategies to garner traction in China was bridging the “gap between the tea drinking culture and the coffee drinking culture by introducing beverages in the Chinese stores that included local tea-based ingredients,” (Devault 2018). By doing this they were creating beverages that Chinese consumers were comfortable with while also introducing them to new options unique to Starbucks. Beyond this, Starbucks deployed the best baristas to train Chinese native employees but made a point to make sure each employee knew the language of the region and could effectively communicate menu items and promotional materials. 

(Starbucks in Shanghai)

Additionally, Starbucks understood the political and cultural aspects of China including their tendency to be more open to luxury items in their more capitalism leaning cities. One of these cities in Chengdu, which is where Starbucks conducted a lot of market research. Here they identified that Starbucks was seen as a somewhat ‘exclusive’ brand. For this reason, Starbucks felt comfortable placing stores here where nearly 80 percent of international luxury brands are located. 

(Starbucks in Beijing)

Starbucks also made it a point to work with local businesses including a joint venture with Beijing Mei Da coffee company in Northern China; a partnership with Taiwan-based Uni-President in eastern China; and in Southern China they worked with Maxim's Caterers in Hong Kong. All of this was to establish connectivity with the Chinese culture in order to create brand loyalty following consumer preferences. 

(Starbucks menu in China)

References:

https://www.thebalancesmb.com/market-research-case-study-starbucks-entry-into-china-2296877

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