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Namaste Starbucks

Namaste Starbucks

January 16, 2011

Starbucks gets set for its India sojourn, but will Indians take a sip?

It’s time for Café Coffee Day & Barista – urban India’s best loved hangout joints to step aside. Starbucks will soon be brewing a fight to capture India’s buzzing coffee market that’s grown at alarming proportions in the last ten years. It was a decade that saw the grubby Udupi restaurant serving the much loved ‘kaapi’ fall out of flavor with India’s mobile savvy gen X and legitimized paying an unheard of hundred bucks for the frothy drink that came along with snazzy seating, smart menus and shining cutlery. Coffee and conversation became the mantra & brands increasingly latched on to the fast emerging ‘hangout’ culture that’s now become all too pervasive through the CCD generation.

Starbucks which is making an entry in collaboration with Tata Coffee is not the first one though to make a bid for India. Costa Coffee & The Coffee Bean & Tea Leaf are still struggling to make their presence felt amid local goliaths, and cracking the market is going to be tough given the first mover advantage the local brands have. The price sensitive nature of the Indian market will also be a challenge say experts.

Starbucks though is positioning itself as an upscale brand, launching initially through the Tata-run chain of luxury 5 star hotels. And going by India’s fast growing appetite for extravagance that could perhaps work well for them.

If the first phase of the country’s growth was fuelled by mass brands making a beeline for the middle classes’ attention, albeit with a touch of quality, the next chapter could well be about big spending and unrestrained decadence. Luxury brands are sprouting all over, changing definitions of what ‘normal’ is and Starbucks is just one among the many international names targeting India’s new found confidence with money. If The Four Seasons opened a couple of years ago, the Shangri-la is on its way and if BMW & Porsche showrooms dot tony neighborhoods of Mumbai & Delhi, the Ferrari is set to steal their thunder this year.

Barista itself took its brand to the next level recently with its premium offering, Barista Crème. And there are even plans to introduce wine and beer menus at some of their lounges.

Now those are surely comforting precedents for Starbucks as it gears up give Indians a whiff of their exotic brews!



8 Comments

  • jasmer singh
    By
    jasmer singh
    10.09.11 10:28 AM
    I want also join the company right now working in ccd as a brew master.
  • vinit sharma
    By
    vinit sharma
    23.06.11 04:22 PM
    i am the big fan of starbuks .i want to join starbuks as a shift manager.in india
  • Amit Joshi
    By
    Amit Joshi
    17.01.11 10:42 PM
    @Brands I completely agree with you! We Indians have this complex for long time. May be we still haven't recovered from aftereffects of British Raj. We still have this stupid notation that anything that is foreign is bound to be better than anything that is Indian. And the funny thing is that majority of the foreign stuff is inevitable manufactured somewhere in Asia (most probably in China or India). But I guess unless we Indians start appreciating our own self, foreign high end luxury brand gonna make quite a dough from India!
  • Brands
    By
    Brands
    16.01.11 06:12 PM
    I quite like Starbucks and think they do a great job of selling coffee/ image / atmosphere etc. But, having just got back from India, I think the Indian coffee houses are pretty solid too - Barista and cafe coffee day are very good. No doubt they have been modelled somewhat on foreign coffee houses but they have done a very good job.

    One thing I did notice, however, is what appears to a subsuming of Indian brands by foreign brands. If you go to a mall, I would say between 70% and 80% of the shops are foreign! Not only that but they charge the same prices in India as in the UK for example. I went into one chain which was selling scarves - they had the UK price and the Indian price on them. The UK price was 20 GBP and the Indian price was 1800 Rupees. Now the exchange rate is about 70 rupees to the pound so it should have been selling for 1400 rupees! And to top it all off the scarf was made in India as well! What amazes me is that Indian consumers are so enamoured of foreign brands that they will buy something in India made in India, but marketed by a foreign brand, at a higher price than that item is sold in the UK! Come on guys, wake up!

    I also visited a few Indian clothing shops and was very impressed with the quality there. There is essentially no difference between an Indian shop selling jeans and an american/ uk one. Actally they are better because you get the same jeans and they tend to be about half to a third the price of foreign brands.

    Indians need to wake up and start buying and supporting their own shops/ brands etc. Otherwise they are in danger of being subsumed by foreign brands. I mean there was a WH Smith in the airport! Could they not find one Indian newsagent or bookseller? Again, India surprises by putting itself down before anyone else has the chance to do it. Again, no other country in the world does that. I just hope they wake up and realize what they are doing before it is too late.
  • Nikhil
    By
    Nikhil
    16.01.11 03:23 PM
    What I am worried about though is we are getting increasingly used to expensive things...at the cost of good marketing and branding! Wish Indians knew how to market their own stuff well...
  • Pravash Dey
    By
    Pravash Dey
    16.01.11 11:33 AM
    I'm a big fan of Starbucks...it wakes me up from Monday to Friday morning before I catch my train from Ealing Broadway station:D
    Jokes apart, I think it should take the advantage of growing Indian economy. I do like their business model.

    As it has a up scale differentiation strategy, it won't harm high street chai-wallas or road side cuttting stalls that much. Free market competition opens up opportunities for innovation, employability and community social responsibility. Starbucks is a great place to relax for many professionals, corporate executives, start-up CEOs. I hope it will continue the same environment in India like the UK.
    As the topics start Namaste Starbucks :)
  • satya
    By
    satya
    16.01.11 10:36 AM
    I have heard about starbucks a lot but never tried it...i guess for a country with a growing effluent population the next best thing would be india

    http://www.superyummyrecipes.blogspot.com" rel="nofollow">Super Yummy Recipes
  • Barnaby Haszard Morris
    By
    Barnaby Haszard Morris
    16.01.11 09:50 AM
    I'm not a fan of Starbucks the brand, or their business model, but I have to admit that they're very good at selling coffee. If anyone can succeed in India, they can.

    It's interesting that they're going to position themselves as an upscale brand, considering there are two Starbucks shops on every street in big-city USA!

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