4P's of Starbucks in the Philippines
Cross-Cultural Marketing
Starbucks in the Philippines
Yves Tsou
Liang Yu Chen
Audrey Arayata
Shana Solis
Introduction
The Market Environment The Philippines is a country located in Southeast Asia. Its 7,107 islands experience 8 months of summer every year. During the summer, the hottest possible temperature to be recorded is 41C. These show just how warm the weather in the Philippines tends to get. Also, the Philippines was colonized by many Western countries, but the most influential colonizer was the United States. In fact, 82% of the population speaks fluent English. These prove that the Filipino culture is greatly influenced by Western culture. It is also customary for Filipinos to drink coffee everyday. Coffee is drank during breakfast and is served whenever guests are around. All these factors about the Philippines make it the perfect environment for Starbucks to compete in.
Starbucks in the Philippines In 1997, Starbucks opened its first branch in the Philippines. This was a significant move for the country as it is Starbucks’ third market outside North America. Starbucks’ main target market includes adults, young adults and teenagers belonging to the upper middle class to the upper class. The company’s unique selling proposition includes a personalized service and a discrete environment.
The problem with opening up in the Philippines, however, is that only 20% of the population belongs to the target market. But despite this fact, Starbucks remains the market leader in the country’s café and bar industry. The chart below illustrates Starbucks’ market share relative to its competitors.
Figure : Market Share of Starbucks Relative to Competition But what is the reason behind Starbucks’ mysterious success? One of the reasons is the fact that Starbucks’ promoted values are a perfect match with the Filipinos values, like warm hospitality, the need for connection and the love for coffee. Also, the company’s
Starbucks in the Philippines
Yves Tsou
Liang Yu Chen
Audrey Arayata
Shana Solis
Introduction
The Market Environment The Philippines is a country located in Southeast Asia. Its 7,107 islands experience 8 months of summer every year. During the summer, the hottest possible temperature to be recorded is 41C. These show just how warm the weather in the Philippines tends to get. Also, the Philippines was colonized by many Western countries, but the most influential colonizer was the United States. In fact, 82% of the population speaks fluent English. These prove that the Filipino culture is greatly influenced by Western culture. It is also customary for Filipinos to drink coffee everyday. Coffee is drank during breakfast and is served whenever guests are around. All these factors about the Philippines make it the perfect environment for Starbucks to compete in.
Starbucks in the Philippines In 1997, Starbucks opened its first branch in the Philippines. This was a significant move for the country as it is Starbucks’ third market outside North America. Starbucks’ main target market includes adults, young adults and teenagers belonging to the upper middle class to the upper class. The company’s unique selling proposition includes a personalized service and a discrete environment.
The problem with opening up in the Philippines, however, is that only 20% of the population belongs to the target market. But despite this fact, Starbucks remains the market leader in the country’s café and bar industry. The chart below illustrates Starbucks’ market share relative to its competitors.
Figure : Market Share of Starbucks Relative to Competition But what is the reason behind Starbucks’ mysterious success? One of the reasons is the fact that Starbucks’ promoted values are a perfect match with the Filipinos values, like warm hospitality, the need for connection and the love for coffee. Also, the company’s
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