Starbucks--Going Global Fast
1. Identify the controllable and uncontrollable elements that Starbucks has encountered in entering global marketing.
One controllable element that Starbucks has encountered in entering global marketing was the pricing of coffee in Italy, because it is said by Italian purists that Italian coffee is way cheaper than U.S. java. Also, Americans pay for $1.50 for an espresso, but the Italians in north and south pay 67 cents and 55 cents respectively. First uncontrollable element that they encountered was in Japan where rivals of same-store rose which made them to fall by 14% for the year end in 1996. Second uncontrollable element encountered by Starbucks was the political and legal bindings in France where Philippe Bloch, a cofounder of Columbus Café, wonders if the Starbucks can profitably cope with France’s regulations and generous labor benefits. Third uncontrollable element was the way of drinking coffee or shall we say the culture in Vienna, because Starbucks would actually attract younger crowd than the established cafes there. 2. What are the major sources of risk facing the company and discuss potential solutions.
One major risk the company is facing is that their customers are losing on their hands, because there are just few options for the customers to choose from. The potential solution for this, they may give more focus on improving the value proposition of their coffee, particularly the taste and aroma of their coffee, so that people would taste another unique coffee and not just the ordinary coffee that they serve for the past successful years of their company. Another risk is that the Generation X feels dominant when they drink coffee in Starbucks and the sense of the coffee in Starbucks is not unique anymore. It is now becoming an ordinary coffee just like what the others serve in their coffee shops, because of the Generation X who are making a statement to change the way they see the coffee. 3. Critique Starbucks’...
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