Starbucks has recently made the decision to expand their operations into the rapid growing markets of India. The firm will be heading this venture with the Tata conglomerate, investing an initial $78-million. Starbucks currently dominates the north American and European coffee and tea markets, with less influence in the Asian regions, especially China and India.

I personally think that this is a very good decision on Starbucks’ behalf. Even though India is primarily a tea-consuming nation, the introduction of upscale cafes in larger cities will be met with open arms as rising income levels in India is leading to overall lifestyle changes.

Starbucks will be facing well-established competitors such as Indian-owned Café Coffee Day, Britain’s Costa Coffee and US rival Coffee Bean & Tea Leaf. One competitive advantage Starbucks has is the partnership with Tata Coffee as primary source for coffee beans. Using locally grown products will ensure a tailored taste as well as effective shipping, manufacturing and production costs.  

Starbucks has built a strong infrastructure in the span of forty years at home in north America, which is extremely vital for moving into international markets. Based on market trends, the most critical key to Starbucks’ success in India is approaching the market slowly. Testing the waters, and working with feedback before making major decisions such as the opening of new stores. It has to be kept in mind that the consumer palette and taste preference will be very different than those in the North American regions. It has to be determined if the Starbucks brand will be able to remain loyal to it’s image and satisfy the new tastes of the Indian market at the same time.

Links:

http://www.theglobeandmail.com/report-on-business/international-business/asian-pacific-business/starbucks-to-open-first-cafe-in-india-next-month/article4573990/

http://www.starbucks.ca/

Facebook has recently announced a new commerce venture into the world of physical goods. The online social giant is expanding its territory by offering a basic gift giving service. The service will include small items such as chocolates, trinkets, and products from participating partners such as Starbucks. The belief stands as: “Real friends, real gifts”. New to the world of online goods, it will be almost impossible for Facebook to compete with pre-existing giants that have established shipping infrastructure such as Amazon. When I personally think of Facebook, a virtual world of social connection comes to mind. Face to face interaction along with tangible goods are not included in this idea. It’s about time Facebook expanded it’s image with the use of online goods. By analyzing Facebook’s history in attempts to generate revenue through outlets other than games and advertising, I expect the gift giving service to be a fad that builds momentum quickly; unlike a few years ago when Facebook attempted to introduce a virtual gift giving service that lost popularity faster than it could even be marketed. As no current records stand on Facebook’s earning’s in the physical good sector the only insights into it’s possible success is it’s massive pre-existing user base. The service will also be accessible via mobile phones, a service that Amazon currently falls behind on. In the end, I wouldn’t say so much “Watch out amazon.” But rather ‘koodos’ to you Facebook for expanding your brand into a market place that holds much room for growth.

Links:

http://www.mediapost.com/pu

blications/article/184051/facebook-rolls-out-gift-giving-feature.html

http://www.theglobeandmail.com/technology/facebook-launches-gift-service-ventures-into-amazons-territory/article4573963/

http://www.facebook.com/

I found this article interesting because it not only touched on the topic of entertainment, it planted roots in branding, marketing and international relations. 34-year old Korean rapper, Psy, released a global hit “Gangnam Style”, that has topped both U.S. and U.K. chats in most recent weeks. What’s extremely intriguing is how this viral video with over 400 million hits on YouTube acts as much more than just entertainment. It has brought an extremely high amount of attention to South Korea. President, Lee Myung-bak has always stressed the importance of showing the country’s more “soft power”.  Psy is literally acting as a magnet for foreigners in the Korean economy. As more attention is brought to Korea in general, the more people take a liking to Korea and in turn Korean products. And there you have it, by simply drawing general attention to a nation, the activity within it’s entire economy can be effected over night. Even though this video is a fad, and will likely die down soon, it acts as a jump-start for the popularity and positive branding of that “softer-side South Korea.” We know that branding and marketing is key in commerce to not only get your name out there but to build a solid reputation as well.

Links:

http://www.theglobeandmail.com/report-on-business/international-business/asian-pacific-business/what-gangnam-style-is-doing-to-brand-south-korea/article4596798/

http://www.news.com.au/entertainment/is-gangnam-style-going-to-break-the-internet/story-e6frfmq9-1226485726434

This article caught my attention due to its particular nature and the relevance it has in terms of highlighting the problems faced in starting a company from scratch. Karen Henry is a mother turned entrepreneur who spends her time making and selling popsicles. Selling hundreds on busy days, Karen is looking to expand operations into wholesale and mass production. The operation currently grosses anywhere from $1,500 to $2,500 a week. Making and selling popsicles is currently a one-person job, from the blending to the freezing and wrapping, everything is done by Karen. In order for her company to expand, there needs to be a certain level of cash investments into heavy machinery for both production and packaging. There needs to be an invested partner willing to sell the products in bulk as well as more than one employee to help run the operations. The most obvious problem or deterrent would be the possibility of bankruptcy due to an unsteady cash flow. The period of time from initial investment to profit can be a huge threat to any company, especially those operating out of their own pockets without any outside funding.

Links:

http://www.theglobeandmail.com/report-on-business/small-business/sb-money/cash-flow/popsicle-maker-grapples-with-growth-risks/article4497660/

http://www.two-tarts.com/2012/06/popsicles-with-roasted-strawberry.html