Question

Based on “Why Starbucks Struggles In Vietnam's $1B Coffee Market” video, please suggest an appropriate research method to identify the customers’ perspectives of Starbucks. Please justify your answer and explain how you go about the research. (300-400 words)

Answer 1

Some foreign coffee chains have been outmatched by local competition, forcing them to wind up their Vietnamese ventures. local coffee makers offers much cheaper coffee. According to some of the people in Vietnam, the price offered by foreign coffee chains like Starbucks does not really suit their wallet. The cost of a cappuccino at Starbucks is almost double the price in local stores like Highlands and Trung Nguyen. one of the reasons why foreign coffee chains like Starbucks struggles in Vietnam is that high rents on premium land have raised the cost of retail prices, making their coffee less competitive than local ones. also, the high cost of importing coffee beans has made international brands less competitive. Starbucks took a ton of initiatives to improve their market in Vietnam. they even invented new drinks specifically designed for Vietnamese. Vietnamese preferred Robusta beans coffee as it has higher caffeine content that Arabica bean. But the problem was instead of using Robusta coffee bean, Starbucks Vietnam used high quality Arabica coffee. Robusta bean produces a bitter taste coffee in comparison with Arabica bean. many customers in Vietnam thought that starbucks taste was not as strong as they liked. Due to this local chains are expanding faster and performing better that foreign coffee makers. Vietnam is the second largest coffee producer in the world, most of which is exported. people there have a lot of local options. Starbucks attracted a lot of customers when they first entered the market. they were attracted not only because of the food and beverages, but the experience that Starbucks provided. Starbucks's main objective was to lure people in coming back regularly. some of the local coffee makers were not happy with this situation. they publicly criticized Starbucks' coffee as "tasteless" .since its entry in Vietnam Starbucks has substantially increased the price of their coffee. thus, forcing its customers to choose cheap and bitter local coffee over it. there are many small coffee stalls on the street that offers coffee that is less than $1. whereas a cup of Starbucks coffee ranges from $1.6 to $5.