Many people’s daily routine in the Western world includes a nice hot cup of coffee and has become a necessity for people. Although we love our cup of java at home, our mornings have changed that it wouldn’t be complete without the early stop to grab a coffee sized venti skinny-no whip-caramel latte in our favourite white cup with the green mermaid logo. The popular coffee chain known as Starbucks has spread like the yellow big capital M we see all over the world, including China! The world’s biggest Starbuck’s location is located in Shanghai, China. Did you know Starbucks has over 27,000 locations in 76 countries? Out of those countries they have the most locations in the United States but in second place is China with 2, 500 locations! So why does this tea drinking culture love Starbucks? This popular coffee chain has succeeded in many ways in China!
10. China is becoming more Westernized
In a country which traditionally favours drinking tea, there is a lot of buzz and popularity around it’s Starbucks locations. But hold on, Starbucks is known for its coffee, are the Chinese making the switch for the Origami dark roast coffee? With the fast-paced rise of the Chinese middle class, estimated at almost 350 million, Starbucks has made its way into their hearts. That’s more than the entire population of the United States and a big portion of this growing middle class in China is considered “Generation 2” which is said to be the most Westernized of the previous generations. The Chinese culture of this generation is adapting to more Western foods, drinks and even style. They are the modern Chinese “boss babes” and “hustlers” who have learned from Westerners that a morning cup of caffeinated coffee is fuel to “get things done”. Starbucks swooped in and took advantage of this by capitalizing on this growing populations love for Western experiences by giving them the “Starbucks experience”. Over 30 years ago China opened its doors to the outside economy and since then there has been a steadily increasing interest in the Western world. A city in southern China, called Shenzhen is said to be the most Western city in China where many of these G2’s migrate to for a more Western experience. You can find many popular Western restaurant chains, stores and brands all over the city. The Chinese are intrigued and open to Western brands which gives brands like Starbucks the chance to rebrand themselves in China.
9. Partnered with WeChat
In 2012, Starbucks joined WeChat, an app with various services that now has more than 500 million users. Starbucks has encouraged Chinese customers to socially interact with it and their friends. WeChat is extremely popular and used by everyone who has a smartphone and that’s well just about everyone! WeChat allows you to pay at Starbucks, order your selected menu items, send a gift to a friend, post in your moments (kind of like Instagram) and so much more! It seems to be the app of all apps so naturally Starbucks wanting to make it big, joined the app. The coffee company also uses it as a marketing technique and started a campaign where users could scan the QR code on their coffee cup and get a chance to win coupons and become a Starbucks member. Users can also scan the QR code to download customized wake-up music from Starbucks for their phones, these freebies appeal to their younger consumers who are likely to share with their friends. Word travels very quickly on WeChat and China uses QR codes for everything and anything, so Starbucks got on this train and made its footprint in this massive population.
8. It’s a Third Place, a Community Spot
The Chinese culture enjoys socializing and social settings just as much as any other. You would imagine they typically do so with the popularity of their tea ceremonies and other social events they partake in but you would be surprised how common it is to go sit at one of these coffee shops. Starbucks locations in China are up to 40% bigger than even their largest United States counterparts! You can only imagine how much more room and space there is to sit and unwind with your laptop, a book or a friend. If you are in a U.S. or Canadian Starbucks you’re lucky to find a spot to sit when you order your drink and need to write an essay, have an important business meeting or a sit-down chit chat with an old friend. In most urban environments in China this is also the case, perhaps this is why Starbucks is increasingly popular for them and it’s a place they can always count on finding a spot to sit and enjoy their grande Green tea Cream Frappuccino. Many of the Chinese place a greater value on the experience and environment Starbucks provides rather than on the quality of the coffee. The Chinese have a real appreciation of the social environment their beverage is consumed over the quality of where the Arabica beans come from. They like an environment that resembles peace and tranquillity and this is what consumers are willing to pay a premium for. Starbucks is considered as a “third” place outside of work and home where they can come to relax and lounge. In China many homes are small, commutes to work are fairly long and there are no typical meeting spots and this coffee shop provides a big space, close to work or home where they have a sense of community. The Chinese are not ones to rush on the go with their matcha latte but more likely to lazily lounge and glue themselves to their smartphones while sipping.
7. Starbucks in China Employs 30,000
With such a mass population in China of 1.42 billion, there is a high demand for jobs and work. Starbucks has created opportunity and jobs for more than 30,000 people in China, from a barista to a store manager. Not only that but the way they operate in this culture is smart as well. The culture has always had a very strong emphasis on the family, so Starbucks China management has made a conscious effort in getting to know not only their employees but their families as well. The coffee company once commented, “family forums have been held for parents of store partners to hear managers discuss gratifying career paths at Starbucks.” They have also included subsidized housing accommodations for some of their employees who were eligible in their positions as barista or shift supervisor. This makes Starbucks a popular place to want to work and spend your time, bring your family and friends and spread the word of the benefits they provide to the people of their country. Additionally, Starbucks introduced a China Youth Development Program that helps mold future leaders, over 1,500 college students benefit from this program over three years. They introduced this program in June 2014 and we can see how since then Starbucks has continued to rise in favour in China.
6. The Chinese Trust Starbucks
American chains like Starbucks in China goes far deeper than just a great cup of coffee or good tasting desserts. Within China, you have to dig a little deeper because there are trust issues. Over the years, China has become infamous for its many food scandals like the fake eggs and fake lettuce that came to light. There is a belief amongst the Chinese that North American companies won’t cheat them the way Chinese companies will because they have higher standards and aren’t just trying to make an easy buck. The Chinese consumer has a hard time trusting anything! They don’t trust their food, their medicine, their water, they don’t even trust the air they breathe. Talk about trust issues! Meanwhile, in Western culture, we trust our food, water and medicine but have trust issues with our romantic partners. In China, it is very common to hear about a scandal related to a faux medicine gone wrong or tainted food using fake meat or baby formula being fake. When it comes to food integrity, consistency is the key, anywhere but especially with Chinese consumers for these reasons.
5. Chinese Consumers Are Loving Coffee!
In most Chinese homes you probably won’t be able to find a coffee maker or a french press but it is highly likely to find oolong and green tea. Despite the strong tea drinking culture in this country, many Chinese people are taking to coffee with enthusiasm. Mostly its the ones returning from overseas, the young and curious, the new generation adapting to the western culture and those following the trends. It is estimated that in China people consume about 4.5 billion cups of coffee a year and this number is expected to grow by 18% in 2019. Starbucks, of course, played a part in creating the demand for coffee in China, by introducing the market with the Western coffee drinking “Starbucks” experience they started a shift. What is the “Starbucks” experience exactly? It’s a place where you can meet with friends, family or co-workers to grab your favourite style drink customized to your choice of liking with your name handwritten on your cup and listen to some funky jazz music as they top off your drink with whipped cream and a caramel drizzle. They present a trendy and cool experience to make the consumer feel trendy and cool by coming there.
4. Starbucks offers Chinese Tea and Desserts
Starbucks has had success in China because it caters to the Chinese market effectively and accordingly. A range of Chinese teas are sold along with coffee and you can also order moon cakes or other traditional desserts from this region. Additionally, they also cater to the Chinese market with a variety of speciality drinks specific to China’s events and flavours. For example around the Christmas season you won’t be able to find the North American favourite classic Peppermint Mocha but instead, you can find drinks like a Snowy Cheese latte and the Christmas Dessert flavoured latte. Even though Christmas is not celebrated in the same way as is it in the Western world they love to be festive during the season too! Around Chinese New Year you can find fun speciality drinks like the New Year Firework latte, Peach flavoured Green tea latte and Macadamia White Chocolate flavoured Macchiato. Sounds like there are some sweet latte options in China! They also capitalized on China’s love of tea by creating trendy and tasty drinks that include ingredients like green tea. They do the same thing for the desserts, offering a range of popular Chinese desserts to cater to the market and their taste buds. You can find moon cake and zongzi, two special and popular Chinese festival desserts or red bean scones, the perfect match to a matcha tea latte.
3. Starbucks on Weibo
Starbucks has an official Weibo account where they market their green mermaid logo. Weibo is a social media platform that is very popular in China with over 500 million users! Why is this important? China doesn’t use social media platforms like Instagram, Facebook or Twitter so the coffee company found the right channel for itself in China. What Starbucks is promoting online on Weibo is not necessarily the ‘traditional’ coffee products we see in the west, they cater their products to the Chinese consumer. Not only that but they also sell their branded water bottles and coffee mugs with bright colours and Chinese style graphics to appeal to their market here. They also encourage consumers to share posts with their drinks or branded products by using the hashtag #starbucks on Weibo. The Chinese love posting about their social interactions so getting on Weibo is especially effective for Starbucks because it’s users trust their social network on this platform. The social element of drinking consistently emphasized on the platform with the number of posts of images of the users with their friends.
2. They Love Luxury Brands
In China, it’s all about keeping face and they love their cool, trendy, luxurious items. Starbucks branded itself as a little bit of luxury coffee shop that almost everyone can afford. With its warm decor, Italianized cup size names, the ridiculous amount of customization you can put into your drinks, somewhat unreasonably high prices, makes Starbucks feel like an indulging luxurious reward. The Chinese, just like any, love a good indulgence and the feels of luxury. Starbucks Chairman and CEO Howard Schultz said to CNBC “We have established Starbucks as, not only the leading provider in coffee but also a brand of choice and luxury in China”. Those that can afford it are still shopping for their luxury handbags, clothes and watches but all of the population is getting their hands on the white cup with the green mermaid logo for the luxury feels even without the handbag!
1. It’s Convenient with 2,500 Locations
With so many Starbucks locations across China, they do not need to travel very far to get to their nearest Starbucks. The people love how convenient it is to find a local Starbucks and how close they can get to a location within walking or biking distance or even by scooter or metro. They also have made it convenient to order by getting on apps that deliver to people, whether it’s at work, your home or your grandmother’s place. You can order from Starbucks and get your latte delivered hot and fresh from a gentleman dressed in all yellow on an app called Meituan amongst a few other apps. The convenience factor is huge especially in a country that has become so reliant on mobile services, technology, convenience and efficiency. To add to the convenience for consumers, Starbucks China has also made it easy for consumers to grab their already made drinks at supermarkets and local stores. They partnered with the Chinese drinks company, Tingyi Holding Corp, to make and sell their drinks in different stores or shops. Needless to say, its available at your fingertips and China really loves their Starbucks!