Tuesday, November 13, 2007
Starbucks Question #2 - Amanda Guay
I would classify Starbucks as pursuing an international strategy because they centralized their product development functions, they established manufacturing and marketing functions in each of the major countries, and they undertook some local customization of product offerings and marketing strategy, but it was limited. I believe it has chosen the right strategic posture because they did exceedingly well in countries that were probably thought of as less promising at the time. For example, the basic Starbucks formula has done very well in international markets. Their Lattes have become standard fare the world over, from non-coffee cultures such as China and tea cultures such as Japan to the coffee cultures of Western Europe.
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Question number 3
Starbucks used joint ventures with local companies to enter foreign markets because they have a certain advantage when they work with local companies. The local companies know the market and the good locations so they can help a foreign company set up their business. The local companies also know the behavior of the consumers; for example, 85% of the international market enjoys consuming their purchases at the location, while 86% of North America take their purchases to go.
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