Question

What are some significant market factors Starbucks need to consider when entering the Italian market?

Economic Factors

Infrastructure/technology

government

Sociocultural

Answer 1

What are some significant market factors Starbucks need to consider when entering the Italian market?

Starbucks is a premier coffee chain originated in USA. While entering in any market in any country in the world, the policymakers have to consider following factors.

Political, economic, social, technological, legal, environmental.

Economic Factors: It has to be considered which phase economy is going through. Premier coffee chain has elastic demand. If economy has recession then people may not go and buy expensive coffees. It should however be considered how Starbucks has initial price, place, product and promotion strategy.

Infrastructure/technology: It is important for Starbucks to analyze the level of technological sophistication in Italy. For. example- prevalence of credit/debit cards, mobile wallets, availibility of advanced machinery required to maintain coffee serving standards which Starbucks has already set everywhere.

government: It may be possible that government does not allow, 100 % investment in a certain sector. Or it may also change tax laws many often. It is also possible that incumbent government promotes indigenous coffee chain and hence may create bureaucratic problems for Starbucks or may welcome Starbucks with both hands.

Sociocultural: A country may have/may not have a coffee drinking culture and tea or any substitute drink may be favored more. It may also be possible that people prefer a particular coffee brand originated from Italy.

Hence all these factors should be analyzed through proper market research.