Advances in Economics, Management and Political Sciences

- The Open Access Proceedings Series for Conferences


Proceedings of the 2023 International Conference on Management Research and Economic Development

Series Vol. 26 , 13 September 2023


Open Access | Article

An Analysis of Starbucks’ Operation and Management Strategy in China

Chien-Liang Chen * 1 , Yanchengchen Li 2 , Yiwen Zhang 3 , Ruizhe Shi 4
1 University of Technology Sydney
2 Hong Kong Polytechnic University
3 Royal Melbourne Institute of Technology
4 Hong Kong Baptist University

* Author to whom correspondence should be addressed.

Advances in Economics, Management and Political Sciences, Vol. 26, 11-20
Published 13 September 2023. © 2023 The Author(s). Published by EWA Publishing
This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
Citation Chien-Liang Chen, Yanchengchen Li, Yiwen Zhang, Ruizhe Shi. An Analysis of Starbucks’ Operation and Management Strategy in China. AEMPS (2023) Vol. 26: 11-20. DOI: 10.54254/2754-1169/26/20230534.

Abstract

Starbucks' growth has slowed in recent years. The "golden decade" of Starbucks is still far away. This article aims to analyze Starbucks China's management's pain points and difficulties and give corresponding suggestions. The analysis in this article comes from texts and data from different sources such as news, periodicals, and Starbucks' official website. The article first described the general situation of Starbucks in China's coffee market, showing how it expanded its stores and developed its brand in China. Then, the article describes Starbucks's four primary pain points and dilemmas in China. The pain points reflect the impact of the external environment on Starbucks' marketing. For example, the market is highly competitive and has regional gaps. This dilemma reflects the effects of Starbucks' internal problems on marketing. For example, staff training is not in place, and online and offline sales development is unbalanced. Therefore, Starbucks still has many deficiencies that need to be improved on the road of Chinese management. Starbucks can only return to the development speed of the "golden decade" by improving these deficiencies. In response to these deficiencies, the article gives four corresponding opinions, which are to expand the business to increase competitiveness; optimize employee incentive system to improve service quality and turnover; increase promotion of coupons to attract more consumers; establish Online communities to increase online sales and maintain their brand image.

Keywords

starbucks, cultural difference, cross-cultural marketing

References

1. Schultz, H., & Yang, D. J. (1997). Pour your heart into it: How Starbucks built a company one cup at a time (pp. 6–10). Hyperion.

2. Starbucks. (2015, December 15). Starbucks mission and values. Starbucks Stories & New. https://stories.starbucks.com/press/2015/starbucks-mission-and-values/.

3. Chen, L. (2020). Research on Marketing Strategy of Beijing Starbucks Coffee Co., Ltd.Zhengzhou University. https://doi.org/10.27466/d.cnki.gzzdu.2020.000499.

4. Li, Z. Y. (2022). Research on Optimization of Service Marketing Strategy of Starbucks in Lanzhou. Lanzhou University.

5. Starbucks. (2022, November 3). Starbucks Reports Q4 and Full Year Fiscal 2022 Results. Investor.starbucks.com.

6. Tan, S. X., Chen, C. Y., & Zhou, Y. P. (2021). Analysis of WeChat official account marketing strategy in the context of OTO - example of Starbucks. Inner Mongolia Science Technology & Economy, 14, (1007—6921), 94–96.

7. Wu, G. (2023, February 4). The proud Starbucks suffered from its own consequences, sales in China fell by 29%, and quality problems occurred frequently. NetEase.

8. Deloitte. (2021, April). White paper on China’s freshly brewed coffee industry. DeloitteChina. https://www2.deloitte.com/content/dam/Deloitte/cn/Documents/consumer-business/deloitte-cn-consumer-coffee-industry-whitepaper-2021-en-210630.pdf.

9. Bandao Urban News. (2022, February 15). People’s Daily Online comment on “Starbucks chasing away police”:Starbuck please take back your arrogance. Bandao.

10. Peng, X. L., Gao, Y. H., & Zhang, Z. C. (2022). The comparison and inspiration of the competitiveness of Luckin Coffee and Starbucks based on the five forces model. Time-Honored Brand Marketing, 17, (2095-1175), 9–11.

11. Starbucks. (2019, April 28). Starbucks-reserve® Coffee ·Wine Shop at the Bund in Shanghai Another innovative creation to upgrade the third-place experience for customers. Starbucks Company News.

12. China Business Journal. (2023, January 7). Layout “coffee +” mode warming food becomes a testing ground for coffee chain enterprises.Baijiahao.

13. Ma, S. (2022, August 2). Why Starbucks“third place” is failing. Zhihu.

14. Oude Ophuis, P. A. M., & Van Trijp, H. C. M. (1995). Perceived quality: A market driven and consumer oriented approach. Food Quality and Preference, 6(3), 177–183.

15. Sun, Y. S. (2022). Exploring the chain business model: McDonald’s vs Starbucks. Business & Economy, 12, (1009-6043), 44–47, 50.

16. Nusair, K., Jin Yoon, H., Naipaul, S., & Parsa, H. G. (2010). Effect of price discount frames and levels on consumers’ perceptions in low‐end service industries. International Journal of Contemporary Hospitality Management, 22(6), 814–835.

17. Purkayastha, D., Sahu, B., Venkata Seshaiah, S., & Tripathy, T. (2019). Can Starbucks Sustain Its High Prices in China? China-Focused Cases, 103–118.

18. New consumption of extractives. (2022, March 15). Starbucks raises prices again, Where does the confidence come from?. Jiemian.

19. China daily. (2021, December 14). Starbucks finally apologises, gets interviewed. Baijiahao.

20. Simple business thinking. (2022, March 6). What Are the Problems with the Marketing Strategy of Starbucks, Which Has Been Hampered by Its Growth in Beijing?. Baijiahao.

21. Chen, P. X. (2022, December 14). With a half-year profit of 125 million, only one trick to save the parent company, Taier pickled fish is too amazing. Baijiahao.

22. Ren, X., Cao, J., Xu, X., & Gong, Y. (Yale). (2020). A two-stage model for forecasting consumers’ intention to purchase with e-coupons. Journal of Retailing and Consumer Services, 59(59), 102289.

23. People’s Network Opinion Data center. (2022, September 15). The 2022 Local Coffee Consumption Trends Insight Report. People’s Network Opinion Data Center.

24. Waanders, K. (2013). The effectiveness and consequences of price promotions-Is there a difference between store brands and high end brands?.Master’s Thesis, University of Twente. https://essay.utwente.nl/63489/1/Waanders_Koen_-s_1177281_scriptie.pdf.

Data Availability

The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.

This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License. Authors who publish this series agree to the following terms:

1. Authors retain copyright and grant the series right of first publication with the work simultaneously licensed under a Creative Commons Attribution License that allows others to share the work with an acknowledgment of the work's authorship and initial publication in this series.

2. Authors are able to enter into separate, additional contractual arrangements for the non-exclusive distribution of the series's published version of the work (e.g., post it to an institutional repository or publish it in a book), with an acknowledgment of its initial publication in this series.

3. Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) prior to and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work (See Open Access Instruction).

Volume Title
Proceedings of the 2023 International Conference on Management Research and Economic Development
ISBN (Print)
978-1-915371-95-9
ISBN (Online)
978-1-915371-96-6
Published Date
13 September 2023
Series
Advances in Economics, Management and Political Sciences
ISSN (Print)
2754-1169
ISSN (Online)
2754-1177
DOI
10.54254/2754-1169/26/20230534
Copyright
13 September 2023
Open Access
This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited

Copyright © 2023 EWA Publishing. Unless Otherwise Stated