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Advertising Coffee in China - Case Study Example

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This paper assesses the best potential strategy that a coffee company could adopt in order to adapt to the existing market trends in China. The paper chosen for this Report is Starbucks and how it could improve its marketing potential in Shanghai…
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Advertising Coffee in China
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Download file to see previous pages For the locals, coffee is still a relatively new drink and their consumption if any, thus far, has been limited to instant coffee.
Tea has been the staple drink in China for a long time, but coffee is making inroads into the market, largely driven by a growing, affluent middle class that is receptive to western tastes. In the middle kingdom, per capita consumption remains low and tea consumption is still dominant, but there is plenty of scope for expansion of coffee into the market (www.friedlnet.com).
The hypothesis of this study is that Starbucks could benefit from capitalizing on its fashionable new lifestyle image and worldwide reputation to improve coffee sales and establish itself firmly in the Shanghai market.
Starbucks is a retail coffee outlet that emerged as one of the Fortune 500 companies in 2003. It has been pursuing a strategy of international expansion in order to promote growth. This is because while the domestic American market has offered it the maximum profits so far, this market is being saturated and if the Company is to continue to experience growth, it needs to expand internationally
As pointed out in an OXFAM Report on coffee, 70% of coffee consumption is in the United States and developed European countries, which are OCED countries. Demand has reached a saturation point and there is not much elasticity in demand that may be expected in these markets. On this basis, the less mature markets such as Asia, Eastern Europe, South America, and North Africa provide much better prospects for growth in coffee consumption over the long term, since coffee is still primarily a luxury good in most of these countries. ...Download file to see next pages Read More
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