As the biggest consuming nation of tea, China now becomes the No.2 market for Starbucks who has its mature and stabilized market in U.S. and other western countries. In the end of 2013, there will be 4,000 Starbucks opening to consumers in China and Asian Pacific. How does Starbucks successfully enter the beverage market of China while the tea culture has embedded in the whole nation? Let us see the value proposition that Starbucks uses to reach the Chinese consumers.

Firstly, the target segments of Starbucks in China are youth population, white collars and the high-income groups with the absence of the elders. As the reason of the flavor preference of the youths, coffee products such as Cappuccino, Frapppuccino and Iced Latte are relatively favored since tea has a bitter flavor which may not take their fancy. In addition of white collars and affluent groups, Starbucks provides the social working environment for these target segmentations. Similarly, Starbucks serves coffee products like other coffee shops in China, however, there are many differences that make Starbucks popular in China. The first strategy is to mix western culture and Eastern culture to enhance the image of China and attract people in terms of store decoration design, sells of Chinese-style mugs and addition of tea products. This strategy also estimates the diverse markets of China, different regions have the characteristic cultures and it can be reflected from the internal and external decoration of the store. For instance, the Starbucks in Xian where theTerra-Cotta Warriors were discovered has the elements of Qin density with bronze-made sculpture, paintings of shadow play and mugs with picture of the warriors. Moreover, Starbucks keeps provide high quality products, which is approached by sending well trained baristas to the new stores in order to maintain good brand reputation.

Starbucks apparently analyses Chinese market well, but the diverse target segments and changing market indicate that Starbucks should keep finding unique services in order to maintain current consumers and explore future consumers.

Bibliography (Image):

Report, According To Its Latest Quarterly. “Starbucks Sees Big Growth in China.”CNNMoney. Cable News Network, 26 July 2013. Web. 06 Oct. 2013.

link:

http://www.usatoday.com/story/money/business/2013/09/16/starbucks-china-flagship-stores/2820885/