5 Ways Starbucks Is Different In China

Starbucks is planning a massive expansion in China over the next couple years that will nearly double its
locations in the country.

It might seem risky for a coffee company to expand so aggressively in a culture of tea-drinkers. But Starbucks
has altered its stores and products to adapt to local tastes and the strategy appears to be working.

The company's same-store sales grew 7% in the region for the most recent quarter and it's planning to open
500 new locations in China by the end of the year, which would make China Starbucks' second largest market
outside the U.S. Here's a few ways that Starbucks is doing things differently in China: 

1. The stores are bigger with more seating space. "Unlike Americans, who can’t cope without a morning
cup of joe, most Chinese customers don’t just grab and go," writes Violet Law in the Global Post. "Instead,
coffee shops here are a destination. People sit back and chat with friends and family. Some come to meet with
clients or do business."

While most Starbucks stores in the U.S. are hectic and bustling, Chinese consumers seek out Starbucks to
"nurse their drinks and lose themselves in their laptops... enjoying tranquility that's usually elusive in teeming
China," Law writes. 

2. The coffee is more expensive. Starbucks charges up to 20% more for its coffee products in China
compared to other markets. The Chinese state media has attacked Starbucks for this practice, but the company
says the prices are due to the higher costs of doing business in the country. 

3. Starbucks stores in China offer a menu of Chinese teas and treats like mooncakes. But one of the best-
selling item in the region right now is actually a Strawberry Cheesecake Frappucino, which is topped with a
cream cheese whipped cream, graham cracker crumbles, and strawberry syrup. The frappuccino "set instant
records for the top-selling limited-time Frappuccino offering ever," Starbucks chief operating office Troy
Alstead said on a recent earnings call.

4. The food is labeled with the country where it was imported from to address Chinese consumers'
concerns about food safety. 

5. Starbucks management makes an effort to get to know employees' families. "Starbucks has ... factored
in family dynamics and expectations in China, where success can be judged by the title on one’s business
card," the company said in a statement. "Family forums have been held for parents of store partners to hear
managers discuss gratifying career paths at Starbucks."

Why Japan Chose Starbucks

Approximately 18 years ago, Starbucks opened up their first location outside North America: Japan. Today,
Starbucks Japan has become the largest coffee chain in Japan with a market share of 48.0%. Their store
locations have grown by an average of 7.3% per annum over the past decade—approximately 70 new stores a
year, and now over 1000 stores in total.
Their aggressive expansion plan projects a goal of 10% annual growth in their locations (approximately 100
new stores a year) in the coming three years. Not to mention, revenue has grown by 14.7% in the past five
years. It seems that more than a few Japanese consumers are choosing Starbucks over the other coffee shops,
like Detour, Saintmarc, or Tully’s Coffee.
It’s clear that Starbucks Japan is a great success story. But the question remains: Why? Why do we choose
Starbucks over other coffee shops? Why are we willing to wait in that never-ending line to pay a premium
price and then struggle to find an empty seat?
Well, the secret may lie in the balance Starbucks has found between maintaining the trendiness of being an
American brand and adapting to the Japanese market. From the moment Starbucks set foot in Japan,
innovation and a fresh American perspective were at the heart of their strategy.
Taking the Innovative Approach
Starbucks was the first café to offer a wide range of drinks with customizable options. Lattes made with
soymilk and reduced sweetness were unheard of at the time, and Frappucinos offered non-coffee drinkers an
option that made it the top-selling product today.
Starbucks was the first coffee chain to implement a non-smoking environment, which appealed to the younger
Japanese generations. In addition, they added an exciting new alternative for their suburban customers—drive-
thrus. Based on their FY13 annual report, the 20 new drive-thru locations had 25% greater revenue than the
overall average the year before.
Starbucks Japan also recently partnered with Amazon Japan to offer Kindle tablets at one of their newly
renovated locations in Roppongi, Tokyo—otherwise known as the foreign business district. This is in
response to the fact that many businessmen require larger screens than what their smartphones provide for the
applications they use. Since they do not have their laptops on them, Starbucks saw the demand for those who
are on break to still be connected to the news, work, or their personal interests.
Lastly, Starbucks has realized that it is not just about the product, but the experience as well. They are
consistently on top of trends and renovating their stores to maintain the look and feel of a trendy American
café.  Their use of digital marketing through social media platforms has expanded their Starbucks fan
community.  They have even hosted a Frappucino themed fashion show in Tokyo with models and a live
orchestra, offering samples of their newest drinks. It’s not a stretch to say that they have been the market
leader in innovation.
Understanding Japanese Culture
Innovation has not been the only factor in their success. Starbucks has also taken the extra step to become
familiar with Japanese culture. An example is the importance of top quality customer service in Japan.
Starbucks has also removed their signature service of asking for a customer’s name when writing down their
order as a result of the Japanese highly valuing their privacy.
To address the Japanese love of tradition and national festivals, Starbucks has developed limited-time seasonal
drinks such as the Sakura (cherry blossom) Frappuccino. They have also implemented “concept stores” that
are specifically designed to complement the atmosphere of certain neighborhoods, and whose product
offerings have been changed to reflect Japanese tradition more thoroughly.
Investing in Training and Development
Another aspect they have focused on perfecting is the training and development of their employees. Starbucks
requires their baristas at Starbucks Japan to go through a two-month extensive training program that makes
them experts in both Starbucks drinks and Starbucks coffee beans.
They provide both a product manual to their partners (baristas), and assign a mentor for the customer service
portion of the training. Prior to becoming a certified partner, trainees are expected to pass both practical and
written tests.
You may be surprised to hear that baristas also wear two different apron colors—green or black. This is due to
the globally implemented Coffee Master Program, where a barista may wear a black apron only if they are a
“Coffee Master.” To become one, you are required to pass an exam on extensive coffee bean theory, held once
a year.
At Starbucks Japan, one in twelve baristas have been certified as a Coffee Master, and you can also find these
black aprons around the world. Only in Japan, however, will you find the first ‘black apron–only’ Starbucks,
where all baristas are coffee masters. The store features a coffee concierge counter where the beans are
brewed using only a coffee press and a metal coffee filter, with a selection of 24 premium coffee beans
available for sampling.
Conclusion: A finely tailored customer experience
While many businesses fail to understand the extent to which Japanese culture cherishes tradition, Starbucks
has managed to combine their exciting American flair with the underlying values of the Japanese to create an
unbeatable experience.
And although they have built the reputation of a café that offers innovative products and exceptional customer
service, they have also become a place that can satisfy their customers’ other motives for visiting a café: to
meet with friends, study, or conduct a quick business meeting. Today, Starbucks has become the go-to coffee
shop in Japan, serving both quality products and a comfortable atmosphere.