Nayab Malik

11874

S.M Class Activity 14-May-20

Identify the reasons why Starbucks failed in Australia?

Australia has proven to be one of the toughest markets to break into for the coffee-empire

Starbucks. Starting in 2000, Starbucks opened their first store in Sydney that quickly turned into

87 locations across Australia by 2008. But customers weren't keeping up with the rapid growth

nor did they care to be. Starbucks launched too quickly and left no room for their Australian

consumers to develop a taste for the brand. Australia has one of the world’s largest coffee

markets, but Starbucks failed to adapt their coffee menu to Australia's coffee culture and rolled

out their business plan on a new continent thinking there was no need to adjust. They tried to

grow their empire too quickly, opening multiple locations instead of slowly integrating them into

the Australian market and ultimately paid the price, closing 61 stores in 2008.

Main Points

 Starbucks rolled out their business plan in a new market thinking there was no need to

adjust

 They tried to grow their brand too quickly without allowing their new consumers to

develop a taste for the brand 

 They failed to adapt their coffee menu in a new market/culture

 Failed to understand the Australian consumer

 Not Underestimating Brand Loyalty

 Projected an Arrogant Brand Image

--The End--
Nayab Malik
11874