The ways Starbucks chose to do business globally

Full Answer Section

• • Licensing: Franchising agreements with local partners, for quicker expansion in specific markets.

2. Adapting to Cultural Differences:

• Product Offerings: While maintaining core products like espresso and coffee, Starbucks introduces locally-relevant beverages and food items. In Japan, they offer green tea lattes and matcha Frappuccinos, while in Mexico, they have Horchata Frappuccinos.
• Store Design: Starbucks maintains a consistent brand feel but incorporates local design elements to create a welcoming atmosphere. In China, some stores feature traditional teahouse elements, while in Morocco, stores incorporate intricate tilework.
• Marketing and Communication: They adapt marketing strategies and communication styles to resonate with local audiences. In Japan, they use mascots and collaborate with local celebrities, while in France, they emphasize the coffee's French roast heritage.

3. Preparing Staff:

• Language Training: Starbucks invests in language training for staff, especially in key markets. This helps bridge communication gaps and improve customer service.
• Cultural Sensitivity Training: Training programs focus on understanding cultural differences, respecting local customs, and providing culturally appropriate service.
• Global Leadership Development: Programs help employees develop the skills and knowledge necessary to navigate diverse international markets.

Challenges and Considerations:

• Balancing Standardization and Localization: Striking a balance between maintaining brand identity and adapting to local preferences is crucial.
• Ethical Sourcing and Labor Practices: Ensuring ethical sourcing of coffee beans and fair labor practices across diverse markets is essential.
• Managing Cultural Faux Pas: Understanding and avoiding cultural sensitivities is crucial to avoid unintentionally offending customers or employees.

By employing these strategies, Starbucks has successfully established itself as a global coffee giant, adapting to cultural differences while maintaining its core brand identity. However, the company needs to continuously adapt and address challenges to maintain its global success.

Sample Answer

Starbucks' Global Strategies:

1. Entering and Expanding:

• Market Selection: Starbucks uses a multi-pronged approach to select markets, considering factors like economic stability, infrastructure, coffee culture, and potential for growth.
• Entry Modes: They utilize various entry modes depending on the market:
  • Wholly-owned subsidiaries: Direct control over operations, used in established markets like the US and Canada.
  • Joint ventures: Partnering with local companies for expertise and navigating cultural nuances, like in China with Yum China Holdings.