The brand that began its operations in year 1971, with whole bean and ground coffee and some tea and spices within a single store on a Seattle’s street has now spread across 55 countries with 17,003 (as of Oct’2, 2011) stores brewing for millions of customers per day.1 The stores now offers different varieties of blended coffee, handcrafted beverages, tea and coffee merchandise, and fresh foods on the platter. 1
India remained one of the biggest untapped market for Starbucks Coffee Company until their 50:50 joint venture alliance with Tata Global Beverages Ltd. in January 2012. Since India is the fifth largest coffee exporter in the world, through this venture Tata Coffee Ltd. will now source and roast coffee for Tata Starbucks and Starbucks Coffee Company for overseas operations as well.2
Although several coffee species exist, only two types make up majority of the worldwide coffee market, Arabica and Robusta beans. They differ in taste, caffeine content, disease resistance and cultivation conditions.3 While Arabica typically grown in Central and Latin America, is considered tastier of the two, it requires great care in growing as it is susceptible to poor soil and diseases, on the other hand Robusta is grown in West Africa and Southeast Asia contain more caffeine and considered inferior because of their bitterness. Since Robusta beans can be grown easily they tend to command much lower price and are best suited for Indian pocket as compared to premium Arabica beans. Starbucks hopes to bring the magic of Arabica beans for Indian consumers.4
According to Coffee Board of India under the Ministry of Commerce and industry Indian Coffee consumption has grown 89% in the past 13 years but will Starbucks be able to attract Indian consumers is the next big question. If Starbucks wants to create an experience for Indian customers that can combine on-the-go-schedule as well as place to relax then it needs to take of certain things.
- Selection of menu which is best suited according to Indian taste having a combination of hot and cold beverages, coffee alternatives, snack meals, etc.
- Accessibility to stores, as per the planning of Tata group initially the Starbucks stores will be opened in Tata hotels in Delhi and Mumbai and eventually will spread out to, universities, railway stations, metro stations, airports and market places all over India. Thus, one has to make sure that the buzz remains ignited and reaches wider audiences.
- Proper customer service leads to leads to customer satisfaction and loyalty.
- Since, India is considered land of tea, Starbucks will have to provide competitive prices to attract more consumers.
- Starbucks Company Profile (Dec 2011); Available at: www.starbucks.com/about-us
- Paul Rice & Jennifer McLean, “Sustainable Coffee at the Crossroads,” White Paper for the Consumer’s Choice Council, October 15, 1999, pg. 20.
- Gregory Dicum & Nina Luttinger, The Coffee Book: Anatomy of an Industry from Crop to the Last Drop, The New Press: New York, 1999, pg. 39 – 43.