Tea, Starbucks' Strategy to Dominate the China and Asia Market

This is in line with the launch of its new tea line, Teavana, across Asia Pacific.
Starbucks, through Teavana, seeks to tap China's lucrative market.
Citing Bloomberg on Monday (12/9/2016), China is Starbucks’ fastest growing market. Starbucks opens at least 500 outlets per year in the Middle Kingdom in order to meet their target of 3,400 outlets by 2019.
Starbucks is now eyeing China as a growth momentum, with a potential tea business of 63.2 billion yuan or 9.5 billion US Dollars, or 124.4 trillion Rupiah. This figure is 10 times higher than the market price for coffee in China.
In addition, Starbucks’ newest tea line is also in line with the increasing consumer demand in China for products that promote a healthy lifestyle. Today, the trend towards a healthier lifestyle is also growing very quickly throughout Asia.
Matthew Crabbe, head of research for Mintel Group Ltd's Asia Pacific, said that there was a strong identity regarding tea in Asia and that it was also in line with Asia's views on maintaining health.
`It goes hand-in-hand with prevention rather than cure, so tea-based products tend to enjoy quite strong growth,” he said.
For your information, Starbucks acquired Teavana in 2012. Soon after, Starbucks then stated that their tea product line was well received in their outlets in the US.
US consumers are also currently seeking out healthy food and drink options, which has driven Starbucks’ tea business to grow by 12 percent and sales of iced tea to increase by 29 percent in 2015.
Whereas in Asia, drinking tea is a habit that has been growing and developing for thousands of years.
In this way, Starbucks must present tea drinks that combine luxury and uniqueness that will attract consumer interest.
`Of course tea has a very mature market in Asia, it’s been happening for thousands of years and we’ve seen the likes of bubble tea being very popular with the younger consumer in Asia in recent years,” Crabbe said.
`But as they get older they’re looking for something a bit more premium and that’s where Teavana fits.”
Author




: Sakina Rakhma Diah Setiawan


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: Aprillia Ika



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