Localization fuels Starbucks' success in China

Updated: 2012-02-13 17:31


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Helped with the localization strategy, sales of the US-based coffee chain operator, Starbucks Corp, increased 30 percent year-on-year in the Chinese market in 2011, compared with the growth rate of 10 percent at home and six percent in the international market, CBN reported Monday.

Li Zhiqi, president of CBCT, a brand marketing institution in Beijing, said that Starbucks has been making strategic deployments based on the consumption trend of the Chinese market since its debut in China, which bears on the needs of its target customers, said the report.

For instance, in the spring of 2008, Starbucks added two classical tea drinks on its menu and launched a low-price strategy of serving dim sum within the range of 8 to 15 yuan ($1.27 to $2.38) in South China, where dim sum attracts a big clientele.

In 2010 Starbucks began to sell Biluochun tea, a type of popular green tea in China, and now it has 9 types of tea drinks on its menu.

On the front of expansion, it now owns over 700 stores in the Chinese mainland and plans to increase that figure to 1,500 by 2015.

The strategies have been working well for the brand. Starbucks saw record net revenue of $3.4 billion in the 13-week fiscal first quarter of 2012, according to fiscall results released on January 26. The net revenue of the Asia-Pacific market accounted to $167 million, an increase of 38 percent over the previous year.