Starbucks' Reputational Risk in Italy
Starbucks has built one of the most respected and well-known consumer brands globally through consistently high standards of execution, a focus one exceptional customer experiences, and a belief that consumers needed a third place, away from work and home to relax. These insights and more from the article Grounds Zero: A Starbucks-Free Italy (Faris, 2012) is the basis of this analysis. Starbucks' many challenges in addressing their reputational risk in Italy, the breadth and diversity of competitors, the drastic differences in coffee taste preferences present formidable challenges for their growth in this nation. Ironically it was in Milan, Italy where Starbucks CEO originally got the idea for the Starbucks experience of being in a cafe, not a traditional American coffee shop (Faris, 2012). To succeed in this market however Starbucks will need to be more effective at managing their competitive threats, capturing opportunities, and managing the differences...
Starbuck's focus on being a 3rd place isn't that aligned with the Italian mindset of how coffee is purchased, consumed and the experience of being in a store. This cultural difference is significant enough to lead to the many competitors Starbuck's has in Italy choosing to further go in the direction of local customer preferences instead of emulation them, a global brand.
The second most significant challenge for Starbucks is the perception of coffee quality, taste and composition between the Italian competitors and Starbucks. The Italian competitors often mix coffee bean blends to create a more robust, acidic type of flavor in their coffees Starbucks has…
