Opinion: The Starbucks Experience – Will it work?

There has been a recent hype among youngsters, single & couples in India.  In spite of long waiting queues, everyone is rushing to Horniman Circle in Mumbai or Connaught Place in Delhi to try and get their hands on the perfectly brewed coffee.  All you see on facebook, BBM, twitter, foursquare is – “Check in @ Starbucks, Hamilton House, CP”

Well, I too, was excited to try out Starbucks. The store offers a wide range of standard Starbucks beverages along with a large variety of food items catered to the Indian taste buds like the murg makhani pie and mutton seekh in roomali roti. The price points are between Rs 80- Rs. 200 similar to the already established competitors that cater to the price conscious consumers. Being a flagship store, it has a well decorated ambience of an Anglicized dhaba with jute ropes, cemented walls and the rustic wooden furniture which makes it different from its competitors like Barista, CCD and Costa Coffee. However, all you see is people clicking pictures at practically every place in the store! The store, currently, is noisy, cramped & over-crowded. Are customers actually enjoying the “STARBUCKS” coffee or is it just for namesake that “You know I went to STARBUCKS”?

High disposable incomes, rapid urbanization, paucity of alternative hang-outs has led to the growth of cafés and doubling the coffee consumption among urban Indians. Cafés not only offer coffee, but tea, beverages and snacks to make these places ideal hang outs. Today the Indian middle class doesn’t mind spending Rs 150 for chilling out with friends. And Starbucks is spot on in targeting the brand conscious middle class customer.



Starbucks is not the first foreign player in the coffee market in India. Established players like UK’s Costa Coffee and US’s Coffee bean & Tea Leaf are already present in the country. But the brand of Starbucks make it an entirely different game. Consumers have seen Starbucks on tv, in Hollywood movies like Sleepless in Seattle, Devil wears Prada among others and are curious about it. This has resulted in a cult following for the company. The consumers don’t mind waiting in line or paying the premium. For them, it is the larger than life experience.

Other global brands like Levi’s, Nike, Ariel and KFC have struggled to adapt to the Indian market in their initial period.  Starbucks has taken a long time to correctly formulate its entry strategy and it is surely off to a flying start. As per the numbers by retail experts, the store in Horniman Circle in Mumbai is generating an average sale of Rs 8.5 lakh a day.
However, there are a few things that Starbucks needs to be careful about. The consumer wants a clean and quite space for work, meeting clients, meeting friends and where they can spend hours without being disturbed. The youngsters want places where they can relax, chat and date without any prying eyes. In India, it is not just about coffee!
Will Starbucks be able to compete with other coffee stores? Will it be able to sustain in the longer run for the value seeking Indian consumer is what we have to wait and watch!

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