“Starbucks-China” Mix: A Throw Soak Grande

Admittedly, there are few genuine “can’t miss” propositions. But I’ve got one for you, Starbucks in China. Giant corporations being granted carte blanche within a totalitarian environment are paying homage to an age when kings granted exclusive licensing for fur trapping. Starbucks gets the product, the relationships, with some nimble campaigning they’ll contain the ubiquitous branding immediately. It will probably be game, set, match – if this isn’t already.

China will be the emerging powerhouse economy these days, but it is not a free-for-all for foreign companies. A lot of companies, in America and elsewhere, would maintain that it is quite the opposite. China has garnered a history of being rather lax to use enforcement of intellectual property laws. Tech companies in particular, including Microsoft, have been frustrated in seeing their handiwork pirated in China. You will add club set manufacturers, music companies, movie studios and any volume of industries towards number of the aggrieved.

And there’s Starbucks, our giant American caffeinery. I’m thinking about a franchise right now from my office at ICMediaDirect.com inside the Empire State Building. It’s pretty busy, full of sightseers. Did you know that there’s a franchise for the Great Wall? Were you aware that Starbucks announced a gap of just one in their stores in Beijing’s Forbidden City, china were furious? They initially resisted, but quickly got employed to it? (I guess china are just like everyone else.)

Exactly what does Starbucks have that Calloway Golf doesn’t to do business this way? A product that you can’t reproduce, that’s what. You can’t fake coffees en masse. That’s the cornerstone that guarantees Starbucks success in mainland China. Their CEO, Howard Schultz, has declared China to become their “number one priority” in terms of growth.

Schultz and Starbucks aren’t shy about their Chinese ambitions. Currently they have about 11,000 stores in 37 countries, including about 375 in China. By 2008 Starbucks expects to derive 20% in their revenue from Chinese locations. Starbucks incorporates a long-term goal of 30,000 stores and many 8,000 in China.

It is a ramp-up of truly gigantic proportions. Remember, China is, perhaps in name only, a Communist country. While a number of the communist economic policies can have fallen from the wayside, the ministers in Beijing have tightly clung to their power. Starbucks may be fully waved in, green lights, red carpet, welcome wagons – the whole shebang. This isn’t because they think the CEO can be a nice guy, but since their product, its distribution channels and everything can’t be copied.

I could hem and haw all day about it, but there’s more proof how the fix is regarding the Seattle based coffee chain. In recent weeks Starbucks has won not one, but two lawsuits in China protecting its intellectual property. Some enterprising, and certainly observant, locals thought we would copy elements of Starbucks brand and serve coffee themselves to their fellow countrymen. No dice. Chinese courts ruled for Starbucks.

I wonder in the event the local coffee merchant thought he’d a possibility? Did china judge think for a while regarding the various merits each side had? Were economic ministers in Beijing curious concerning how this situation would turn? There wasn’t any drama. An accomplished CEO like Schultz wouldn’t publicly refer to such lofty goals to achieve in countries like China not knowing he could reach it beforehand. Somebody in Beijing likes them, or again, likes the revenue they generate.

It reminds me of the book I just continue reading the infamous pirate Captain Kidd. To put it briefly, the English crown hired Kidd to rob pirate fleets to make money. While he was on the ocean, the winds of political change shifted somewhat anf the husband became a scapegoat – his “trial” would be a farce. The powers that be needed a quick conviction and Kidd paid along with his life. Perhaps the stakes weren’t as great, but the outcome was just as assured when China ruled for Starbucks against local knockoffs.

Okay, so Starbucks gets the quality coffee and international distribution channels down, they’ve got a golden okay from Beijing, now all they need to do is convince a rustic with 5,000 numerous tea drinking experience that there’s a new challenge, something more important – called coffee. This necessitates branding.

China is moving towards Westernization, or perhaps a more capitalist economy. The growing appetites and expectations of the consumer driven society make task of Starbucks task easier, especially since their competitors is negligible. With the appropriate deals struck in Beijing, it’s now time for Starbucks to market themselves towards Chinese people. Here’s how they’ll win:

¢ They are aiming for the young urban Chinese demographic, and store locations are comfortable and offer a social setting – a welcome break from cramped apartments.
¢ Starbucks locations will serve as Web surfer hubs, where socializing and downloading music will probably be central towards Starbucks Experience. Advertising agencies, like ICMediaDirect.com, will probably be running seasonal online campaigns (like that past Christmas season’s Red Cup campaign in the usa) for Starbucks in order to associate the chain with what’s hip. Crossing Medias like music downloads and entertainment websites will probably be crucial.
¢ There can be a consumer consciousness that’s a new comer to capitalist cultures (never leaves, actually) emerging in China that’s a lot like Russia. Coffee would be the drink of change and through multimedia branding with governmental support; this idea will probably be solidly reinforced.

I don’t push stocks. I don’t preach politics. I’m not seeking justice or defending oppressors. But there’s something I understand – Starbucks can’t miss.

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August 30, 2011 | Filed Under Social Campaigns, Social Radio Spots, Social TV Spots 

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