Starbucks Company Marketing in Italy - 569 Words | Essay Example (2024)

Introduction

Organizations should be strategic, especially when operating in the global market. Failure to apply tactical measures leads to failure, as most of the competitors take up the company’s consumers, which lead to business closure or profit reduction for the victim (Peng, 2011).

This paper reports on why Italy faces a ‘reputational risk’ for Starbucks and the challenges the company faces in tackling the threat. It also addresses the question of whether entering the Italian market would offer a strategic advantage for Starbucks and how the competitors marketing strategies should influence its entry. Finally, it tackles the question of whether Starbucks should enter into the market.

Starbucks in the Italian Market

The Italian market sets a ‘reputational risk’ for Starbucks, especially as it sets the global standards for the quality of coffee in the world, against which all other coffee is measured (Faris, 2012). Consequently, the natives are faithful to the coffee and they do not welcome new entrants in the market, which may explain why Starbucks is hesitant about entering into the market.

The notable factor is that the company has spread in other regions where it was the first coffee seller, attracting customers to the new product. The case in Italy is different as the gap that existed in other regions is absent in the country.

Starbucks would face a strategic advantage if it entered the market, particularly where tourists in Italy are concerned (Finch, 2013). It is notable that the country attracts many vacationers, as it is ranked among the highest tourist destinations in the world. The main sites include Venice, Vatican museum, Amalfi Coast, Colosseum, ‘The Last Supper’, Milan Duomeo, Spanish Steps, and others. Markedly, most of the visitors hail from America, and Starbucks can strategize based on this market.

Notably, most of the foreigners are already accustomed to Starbucks outlets in their home countries, and as a result, they would easily buy the company products, as opposed to the coffee sold in other Italian shops. Furthermore, the job market in Italy is filled by foreigners based on high immigration rate, which explains why Starbucks would identify them as a niche market. Consequently, some of the natives may also be interested in the coffee, and this would serve to increase the market.

The competitors price their coffee cheaply, as compared to Starbucks’ prices, as a way of beating competitor fees (Faris, 2012). Moreover, the local availability of the product also makes it slightly low-priced compared to Starbucks coffee. Additionally, the rivals only sell Italian blend coffee, as opposed to a wide variety available in Starbucks. The coffee shops as well sell other dishes such as meat so that the families can take their meals in these locations.

Consequently, Starbucks should use premium pricing based on the fact that high prices will indicate better quality to the Italians, and as a result, they will desire to make some purchases. Furthermore, they should make their shops exclusively coffee outlets as a branding strategy, as opposed to competitors who sell other meals (Finch, 2013). They should in addition customize their content to suit the customers’ needs, and this will attract more clients.

Conclusion

Conclusively, Starbucks should enter into the Italian market with the main focus being the tourists and other foreigners who are immigrants from other countries, as these are already used to the coffee. Additionally, they should focus on attracting new Italian clients by customizing the product.

References

Faris, S. (2012). Grounds Zero: A Starbucks-Free Italy. Web.

Finch, J. (2013). Managerial marketing. Englewood Cliffs, N.J: Prentice-Hall.

Peng, M. W. (2011). Global business. Mason, OH: South Western Cengage Learning.