Case Synopsis, Uses, Discussion Questions, and Answers
33
CASE 14 s Expansion into China
Synopsis: s expansion strategy into China. Focusing on the marketing
mix elements (product, promotion, price, s
success in China is revealed over years since the decision to concentrate in China in
Uses:
Chapter 4 Adapting the marketing mix to reach different consumer segments
1. Prepare a SWOT analysis bas s expansion plans in
China. Based on your SWOT analysis, what recommendations would you make to
s CEO with regard to the market development growth strategy for this
country?
s Expansion into China
Strengths (Keep/Maintain)
– Recognized global brand
– Quality product premium coffee
–
– Offers a comfortable environment for
patrons
Weaknesses (Improve)
– Large company with many other growth
opportunities
– Forced to close underperforming stores in
the U.S. after rapid expansion
– Lacking knowledge of the China market
Case Synopsis, Uses, Discussion Questions, and Answers
34
– Great service provided
Based on the above SWOT Analysis regarding s expansion into China, a positive
recommendation would be provided to the CEO of Starbucks to move forward with continued
growth in this emerging market. When reviewing the strengths of the company, it is apparent that
Starbucks has many internal characteristics that will ensure successful additional locations in China.
Starbucks also needs to improve upon some weaknesses. Starbucks has a lack of knowledge of the
Chinese market. The products may not appeal to local tastes and the prices may also be too high for
the Chinese consumer. The rapid expansion of Starbucks in the past has proven to be costly and the
company was forced to close many stores after expanding too rapidly.
Case Synopsis, Uses, Discussion Questions, and Answers
35
2. Give examples of how Starbucks was successful upon entering the China market. Please
use the following videos to frame your response.
– Starbucks grows coffee in China, Reuters video, available at:
– Recognized different cultures in China joined forces with three regional partners
– Partnerships and joint-ventures allowed insights into tastes and preferences of Chinese
population
– Smart market entry strategy selected high-visibility and high-traffic locations
3. Compare Starbuck s U.S. and Chinese strategies. What are the similarities and
differences? What generalities can you glean from this analysis to help the company
expand into other global marketplaces? Please use the case and the following article to
frame your response.
– “Starbucks’ Quest for Healthy Growth: An Interview with Howard Schultz,” McKinsey
Quarterly 2 (2011), pp. 34-43, https://www.mckinsey.com/global-themes/employment-
and-growth/starbucks-quest-for-healthy-growth-an-interview-with-howard-schultz
Starbucks grew rapidly in the United States under the direction of the management team in the
Seattle headquarters office. As this premium coffee company became a national brand, Starbucks
s CEO, the growth
Case Synopsis, Uses, Discussion Questions, and Answers
36
This history can help Starbucks expand into other global marketplaces. Starbucks realized that
decentralizing operations can be beneficial to gaining an understanding of a specific market. The
company als