Yes, you’ve guessed it. It is all about Starbucks. The Seattle-based coffee emporium has opened its first cafe in Costa Rica, the country that provides it with plenty of its precious raw material.
So what can we learn from it?
- There is clearly potential for expansion in Latin America, but not just in the better-known economies of Chile, Mexico or Brazil, but in the smaller and lesser-known countries (at least from a UK perspective). Think Costa Rica, then think Uruguay, think Panama…
- There must be quite considerable purchasing power, too (Starbucks is not cheap!) – could your business tap into this market? And check out the location they chose, very wealthy Escazú…
- Now, the thought of more Starbucks opening in Latin America frightens me on a personal basis, since I am a not a fan of their coffee at all. There are plenty of charming, fantastic cafés across the continent, so why add these “gringo” establishments that sell what my father would call “that horrible stuff you can have a bath in [clearly, an espresso fan]”? Whether you like it or not, Starbucks has tapped into a market that loves it, mainly influenced by US media and television, and they are not buying the Starbucks coffee, they are buying into the whole experience. And even I can’t blame them for that. I recently visited Buenos Aires (Argentina) and found the Starbucks in Alto Palermo Shopping Centre (yet again another highly premium location) busy at all times. Mainly teenagers and young professionals with high aspirations and reverence to imported goods – and imported experiences. Their father’s local cafés don’t really cut it for them. Too shabby, sometimes unhygienic, sometimes even intimidating. And without free wifi or a facebook page.
- Which nicely leads me to the social media arena. Within a day – a day – of opening, Starbucks Costa Rica has nearly 3,000 fans on Facebook, and they are doing a great job there. They are creating a community, they are bringing customers right to the centre of their world. It is amazing how many businesses miss this completely. For example, Mothercare opened franchises in several Latin American countries. I have researched their social media presence (from a market research perspective, I don’t claim to be a social media “pro”) and it is really “uninviting”, to say the least.
- And, guess what? They are not stopping here. The company has announced hundreds – read again – hundreds of new cafes in Mexico, Brazil and Argentina in the coming years.
Not a big fan of Starbucks. But they can definitely teach us a business lesson or two.
I would like to thank CNN Expansión (on twitter) for sharing the news which inspired me to write this post (click here). You can follow their twitter feed @cnnexpansion.
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