WHAT CAN STARBUCKS ADD TO THE 500-YEAR-OLD COFFEE CULTURE
Nesrin Korkmaz International Strategic Communication Professor Doshi April 21, 2016
CAMPAIGN DESCRIPTION
Starbucks Coffee Company:
Starbucks Coffee Company started its operations in 1971 in Seattle, Washington
(starbucks.com.tr, n.d.). After being sold to Howard Schultz in 1987, the company began expanding rapidly, first in the United States, then in the global markets (starbucks.com.tr, n.d.). The secret of the company's global success lies behind its vision that was inspired by the Italian coffeehouse experience: to become the third place after home and office where people can enjoy quality coffee over conversations that are nurtured by the sense of community at every Starbucks store
(starbucks.com.tr, n.d.). Today, with more than 24,000 stores in 70 countries, Starbucks' name represents one of the largest coffee brands and coffeehouse chains in the world (starbucks.com, n.d.).
In the beginning, Starbucks differentiated itself as a company that offers "affordable luxury" to white collar urban dwellers who would be more likely to have a demand for the "third space" in their lives (Mourdoukoutas, 2013). Although the company's American target profile now includes the less educated, the young, and the rural area residents, Starbucks' global consumers still resonate with the initial target segmentation, especially in middle-income countries such as Turkey.
Through a partnership with Shaya, which is the branch of a Kuwait-based company that invests in the Turkish retail market, Starbucks Turkey opened its first stores in the three upscale neighborhoods of Istanbul: Bağdat Caddesi, Akmerkez, and Kadiköy in 2003 (shaya.com.tr, n.d. and milliyet.com.tr, 2003). By 2016, the number of Starbucks stores reached to more than 230 in 22 cities across the country (shaya.com.tr, 2016).
Coffee Market in Turkey:
According to an article on kesfikahve.com (2015) only about 78 percent of Turks drink coffee. This is surprising considering the long-standing coffee culture in Turkey, yet tea is the hot beverage of choice for most Turks. About 95 percent of the Turkish households report to brew tea regularly (Altuntaş, 2015), and, in fact, Turkish people are the biggest tea drinkers in the world (3157 kg of tea per capita per year) according to 2014 statistics (Ferdman, 2014). In comparison, per capita consumption of coffee is low -- only about 550 grams a year according to Ceyhan Pusmaz, the director of Turkey Operations at Coffeeshop Company (Karaboğa, 2014). In spite of the high preference for tea, there is a growing demand for quality coffee among the younger Turks as the booming coffee shop industry can attest (Gonultas, 2015).
The first coffee chain brand that opened its stores in Turkey was Gloria Jean's Coffees back in 1999 (gloriajeans.com.tr, n.d.). By opening its first stores in 2003, Starbucks followed the Gloria
Jean's Coffees (currently 51 cafes) example. Today, 31 coffee chains (both local and foreign) operate in more than 1,170 stores (Kuburlu, 2015). Starbucks is the market leader with its 234 stores across the country (Kuburlu, 2015). The competition is getting fiercer, yet the barriers to entry are not high in every city as the foreign chains focus on growing in the metropolitan areas only, and local brands focus on expanding their reach to the rest of the country (Kuburlu, 2015). According to store information on their websites, some of the most well-known competitors of Starbucks are Kahve
Diyari (134 stores), Kahve Dünyasi (125 cafe and corner shops), Robert's Coffee (49 cafes), Cafe
Nero (49 locations), and Gönül Kahvesi (72 cafes). Another trend in the coffee industry is the third wave coffee houses that bring a larger emphasis on the origin and the quality of coffee (the roasting and brewing process) as well as the customer experience (Gillis, 2014). Independent third wave coffee houses are popping up rapidly in major urban areas such as Istanbul, Ankara, and Izmir. They are gaining popularity among the young and educated Turks who are constantly on the look out for the next hip coffee shop (Gillis, 2014).
Currently, the coffee industry in Turkey generates nearly ₺500 million (about $180 million) revenue a year, and it is expected to grow 100 percent in the next five years (kesfikahve, 2015).
Although the major part of the revenue (about ₺125 million) still goes to the Turkish coffee, the instant coffee brands, the coffee shop chains, and the independent coffee houses have been consistently increasing their shares of the market (Turkish coffee's share dropped by 10 percent in the last two years) (Tuvay, 2015).
Starbucks has been the market leader among the coffee house chains, and the increasing interest in coffee and consumption of coffee provide an excellent opportunity to get more Turks to drink Starbucks. However, it is necessary to keep the target audiences loyal to the brand by engaging with them in ways that they prefer.
CAMPAIGN OBJECTIVE
Although Starbucks has a high brand recognition in Turkey, it is important to strengthen the ties with the target audiences especially considering that there has already been a shift toward the third wave coffee houses in the metropolitan areas.
This campaign aims to increase the sales of Starbucks coffee and enhance the loyalty to the brand by 20 percent in the next year among college-educated students and professionals by positioning Starbucks as the place that offers the best coffee and atmosphere for socialization.
TARGET AUDIENCE People between the ages of 15 and 30 make up about 25 percent of the overall Turkish population, and nearly 40 percent of this group of young people are college educated. According to a survey conducted by Vivaki Business Intelligence (2013), some of the habits of this segment are as follows:
• Open to trying new tastes and experiences and going to cafes and restaurants that offer these
experiences,
• Have a tendency to consume more sweets and fast food,
• Drink espresso based or filtered coffee regularly,
• Have a high preference for name brand coffee and coffee shops as the brand's logo is a way
of showing off their habits,
• Are active users of the Internet and the social networking sites,
• Own a smartphone and a laptop,
• Identify themselves with the places they live and visit,
• Place a high value on family and friend relationships (friend groups and socialization with
these groups are the essential part of their lives outside the home).
This campaign will target two distinct audience groups in Turkey. The first one includes the current college students in the ages between 18 and 24. About 56 percent of the college students do not live with their parents (if they are going to a university in metropolitan areas, the percentage is even greater), 93 percent of them eat out, and, on average, they spend ₺613 a month (halklailiskiler.com, 2012). The larger share of their spending goes to food and entertainment as 56 percent of them report to go out to eat at a cafe or a restaurant a couple of times a week and nearly half of them go to a fast food restaurant at least once a week (shiftdelete.net, 2015). College students may not have a large budget, but they are the trend setters in the food and beverage industries and are highly influential among their peers. The other group is the young professionals in the ages between 24 and 35. This group contains mainly college-educated professional women and men who have the upper-middle income status. They are also called "beyaz yakali" or "plaza insanlari," which refers to the social and economic status of these Westernized, stylish, and urbanite Turks.
This group has a higher disposable income and are more likely to have a young family unit than the first target segment.
COUNTRY PROFILE
Political Structure:
Turkey is a republican parliamentary democracy. Turkey’s constitution (the first one ratified in 1923, the current was proclaimed one in 1982 and amended in 2001, 2007, and 2010) designates the main principles of the state and establishes the organization of the government (CIA, 2016). The constitution also separates the government into three branches: the legislative, executive, and judicial
(Aksel, 2013).
Although Turkey may seem like a democratic country on paper, there are some problematic areas in practice. Ever since AKP came to power in 2002, the party has been trying to seize more power from the other branches of the government (t24.com, 2016). They did not have much difficulty since they had a majority in the assembly. I also have observed that over the years, AKP was able to displace some of the judges with critical importance and crack down on the military personnel, the journalists, the academics and university students. In short, the party has been working hard on oppressing opposing groups.
From my personal experiences, I can say that the AKP’s harsh reaction to Gezi Park protestors in 2013 turned a significant portion of the college educated students and professionals against the party. For many of these young people, Gezi Park protests can be considered a catalytic moment as they became aware of who they are and what their generation represents at large.
For Starbucks, this means that the company should stay away from getting involved in politics at all costs (the brand has to work with the government entities, but cannot neglect the consumers either). It is also important to remember that staying away from politics is not always so easy. For example, during the Gezi Park protests, Starbucks’ Taksim branch was highly criticized for not letting protestors in when they were trying to avoid the pepper gas (mynet.com, 2013). Also,
Starbucks should focus on what the target audience discovered as their unique qualities during and after the Gezi Park protests. These include being global-minded and independent, demanding a right to lead a life of their choice, being able to express themselves freely, and valuing peace and democracy.
Economic Structure:
The country had 798.4 billion GDP in 2014, which makes Turkey the 18th largest economy in the world (The World Bank, 2014). Turkey is mainly a free market economy, and the Turkish economy has been growing faster with the contribution of industry and service sectors. Based on
2014 statistics, GDP composition of the service sector makes up
67.6 % of the economy; industry constitutes to 27.6 % and agriculture to 8.1 % (CIA, 2016). As mentioned before, Turkey's current size of the coffee industry is about ₺500 million
(Gonultas, 2015). According to a report by International Coffee Organization, Turkey's coffee import made a 13.6 percent increase from 2013 and reached to 55,000 tons in 2014 (Gonultas,
2015). Turkey will continue to import even greater amounts of coffee considering the bright prospects of the coffee industry (100 percent growth is expected in the next five years) due to growing demand for coffee in the country (Gonultas, 2015).
Social Structure:
Coffee has a long history in the lives of Turkish people. Ottoman Turks discovered coffee through trading in the Arabian Peninsula (felsefetasi.com, 2014). In 1554, two merchants opened the first coffee house in Istanbul just outside the Egyptian Bazaar (a major destination/marketplace on the Silk Road) (flsefetasi.com, 2014). By the 19th century, the Ottoman Empire had nearly 2,500 coffee houses (felsefetasi.com, 2014) Since the emergence of the first one in the 16th century, coffee houses and coffee have become the symbols of socialization and cultural interaction for the Turks
(flsefetasi.com, 2014).
Over time, Turks developed their own customs and traditions for coffee. These traditions vary from the method of brewing and serving coffee to the meanings of drinking it in various social settings. Some of the places where the impact of coffee culture can be observed are:
• In idioms such as "A cup of coffee will be remembered for 40 years," meaning that the
socialization while drinking coffee is very valuable and respected. Also, generally speaking,
important topics are discussed over coffee.
• The occasions: In Turkey, asking for someone's hand in marriage is not official unless the
groom-to-be and his family pay a formal visit to the bride-to-be's family. During this visit,
the bride is expected to serve Turkish coffee to everyone, and the discussion about the
couple's marriage does not start before everyone is done drinking their coffee. In the lives of our target audiences who have a growing demand for filtered/espresso-based coffee, the traditional connotations about coffee still exist. That is why it is smart to keep the
Turkish coffee on the Starbucks menus as a way of showing respect to the tradition. Also, socialization at coffee shops is highly preferred by our target audiences. Therefore, it is important to note that when communicating with the target audiences, Starbucks needs to emphasize how it provides the perfect atmosphere that nurtures social interactions.
CULTURAL PROFILE
Individualism vs. Collectivism:
In collectivist cultures “we” is much more important than “I,” and people who are in the same ingroups look after each other in exchange for loyalty. Developing healthy relationships with members of the community, caring about the well-being of the entire group/family rather than only one’s own and, seeking harmony in the society are some of the indicators of the collectivist cultures.
On the other hand, individualistic cultures value personal goals, autonomy, and independence.
According to the Hofstede Centre’s analysis, Turkey scores 37 on individualism/collectivism metric, which shows that the country is a collectivist culture (geert-hofstede.com, n.d.). However, despite this general viewpoint of the collectivist Turkish culture, individualism is on the rise, especially in urban areas such as Istanbul, Ankara, and Izmir. From personal observations, I can add that among the target audiences of Starbucks, individualism comes across as a trending approach to life. This trend among the educated youth and professionals is happening partly as a reaction to the social pressure coming from an increasingly conservative and polarized society. Labels like "the marginals" (because of their lifestyle choices such as being modern and secular, and following the global trends) placed on the educated youth and professionals by the conservatives in the society cause them to stop believing in collectivist ideals of the mainstream society and focus on what they want as individuals. However, they still care about the opinions of their friends and families, and they may be more likely to perform some characteristic behaviors of the collectivist cultures when they interact in these groups.
For Starbucks, this means that the communication plan should highlight the personal gains and experiences for the target audiences while putting an equal amount of attention into emphasizing the social ambiance that makes sharing experiences much more memorable at
Starbucks.
Also, collectivist cultures value developing lasting relationships. This is of particular importance when it comes to building and maintaining customer loyalty. Promoting Starbucks’s existing reward program and offering special deals to consumers can be a way of strengthening brand loyalty among the Turkish target audiences.
High Context vs. Low Context:
Hall (1976 in Freitag and Stokes, 2009) says in high context cultures the communication message is internalized in the person, or the essence of the message is hidden in the physical context.
In contrast, in low context cultures, almost everything is coded explicitly in the language. People in high context cultures communicate through implicit and covert messages with the extensive use of nonverbal coding such as gestures, intonation, facial expressions, eye movements, etc. There are also distinct ingroups and outgroups, and time is considered open and flexible. From this perspective, Turkey is a high-context culture.
As a native Turkish speaker I can say that the meaning of a sentence may change based on the situation and place, the person's nonverbal communication, the tone of speaking, etc. Although
Turkish way of communicating with others may seem enigmatic to people from other cultures, it is important to master it to cut the clutter and reach the audience. Especially the educated Turks appreciate the high context way of communicating since it is considered "intelligent" both on the part of the encoder and the decoder. The same high context principles are implemented even in the visual communication practices: a picture can resemble multiple things from multiple perspectives.
The fact that Turkey is a high context culture, and the use of ambiguity and irony are celebrated among the Turkish audiences makes it necessary for Starbucks to implement the communication campaign through a partnership with a local PR agency. This way, the company can avoid miscommunication with target audiences and tailor their communication messages to reflect the audience preferences. Also, the employees should be trained so that they will not clean up the tables when the patrons are still sitting at the table (although all Starbucks stores are self-serve, the cleaning of the tables are still done by the staff). Doing so sends consumers a "leave now" message, which would contradict with the Starbucks’ positioning of being the place of social interaction.
STRATEGY & KEY MESSAGES
The strategy of this campaign can be summed up as telling the story of quality at Starbucks.
The campaign messages will focus on the quality of coffee, the service, the atmosphere, and the quality time that the consumers have while at Starbucks.
Key Messages:
- "Our baristas serve the best quality coffee that is grown and brewed with love."
- " Quality time happens at Starbucks."
TACTICS
"Our baristas serve the best quality coffee that is grown and brewed with love."
1. Pop-up Starbucks Tents.
The purpose of this tactic is to get more of the target audience try out various types of coffee beans (Verona, Italian roast, Pike Place, etc.), brewing techniques (French press, Aeropress, drip brew, espresso), and the specialty drinks (cappuccino, espresso macchiato, flat white, etc.) By setting up stands at major university festivals and business centers.
2. Social Media Campaign: #benimkahvemstarbuckstan
Because an overwhelming majority of Starbucks’ target audiences use social networking sites such as Facebook, Instagram, Twitter, and Snapchat, a social media campaign will provide a perfect opportunity to communicate with the consumers. This tactic will include an Instagram contest that asks Starbucks patrons to share a photo of their coffee with #benimkahvemstarbuckstan (it means
"my coffee is from Starbucks”). The announcement about the contest will be shared on other social networking platforms and will be featured at the stores in the print format. The winner of the contest will receive a French press, a mug and a sample-sized coffee beans of various kinds.
3. Publicity Stunt: Mermaids at the Mall
This tactic will be implemented on the same day at popular malls in the metropolitan areas
(Zorlu Center and Cevahim AVM in Istanbul, Forum Bornova in Izmir, and Anka Mall in Ankara).
These malls are among the places our target audience visits on a regular basis. A person in a mermaid costume (the costume will not be too revealing) will sit on a platform and ask trivia-like questions to the visitors. If the visitor guesses the answer correct, then they will be given a "Starbucks Reward Card" with $20.00 on it. The purpose of this tactic is both to get media attention and to promote the reward program. Also, the content of the questions will be about coffee and coffee culture.
4. Starbucks Coffee Workshop:
The Starbucks coffee workshop series will take place during Istanbul coffee week and 06
Kahve Günleri (annual coffee festival in Ankara). The workshop will be open to the public, yet reward card owners, social media followers, and students will receive special discounts. During the workshop participants will learn how to brew coffee using different techniques. Once again, the coffee workshop will be an opportunity to prove the quality of coffee and service at Starbucks as well as to attract media attention.
" Quality time happens at Starbucks."
1. Open Mic Night at Starbucks:
This tactic is geared toward both the student and the professionals. The event will be held at the most visited Starbucks branch(es) in every city. Initially, the local bands will be invited to perform at the event. As time goes by, the open mic nights will be open to anyone's contribution and more spontaneous. The audience will also be encouraged to share the photos and videos of the events on social networking sites. This tactic will directly appeal to the lifestyles of the target audiences. An open mic night is also a great way to show target audiences that Starbucks is a place where they can be themselves and be entertained.
2. Social Media Campaign: Everything You Need
This social media campaign is designed to show target audiences that every Starbucks store has the things that they look for in a cafe. Social media posts on Facebook, Twitter, and Instagram will feature the capacity of indoor and outdoor seating areas, the free Wi-Fi service, food, and relaxing music at Starbucks. This campaign will also showcase the individual locations and their unique offerings such an incredible view of the Bosporus at Bebek or an excellent opportunity to people watch at Istiklal Caddesi.
3. Social media and Spotify paid ads: #kahvebahanestarbuckssahane
This campaign will start as a paid social and Spotify ad campaign to show professionally produced videos of real customers. The ads will be in a 15-second format and will be shared on
Instagram, Facebook, and Twitter. Each ad will feature the coffee shops' patrons and will tell the story of why they choose to come to Starbucks. The campaign hashtag
#kahvebahanestarbuckssahane (it means coffee is just an excuse, Starbucks is awesome) will be used. The second step of the campaign is a contest on Instagram. Starbucks' followers on social media will be asked to post their own reasons to visit, using the hashtag
#kahvebahanestarbuckssahane. The owners of the best videos will be awarded to join "Starbucks
Coffee Workshop" in Istanbul or Ankara.
EVALUATION
The campaign will run from September 2016 to October 2017. During this period, social media engagements and media coverage of the Starbucks will be monitored closely. At the end of the campaign, customer loyalty will be evaluated through surveys. Increase on sales will also be evaluated through benchmarking the pre and post campaign sale statistics.
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