A second example is Starbucks China, where it has adapted its products and stores successfully to local preferences. Specifically, it has introduced beverages using popular local ingredients, such as green tea, and has battled the conventional dislike of coffee by offering coffee-free beverages such as the “Red-bean Frappucino” (Starbucks, 2015). Further, Starbucks adapted their stores to cater larger groups of people by providing a more adaptable seating arrange with easily-movable tables and chairs (Tepper, 2012). This said, it provides more flexibility in seating, since Chinese tend to go out in bigger groups (Peterson, 2014). Also, Starbucks’ advertising strategies play an essential role – these are more local and differentiated than standardized (Mourdoukoutas, 2013). Since its launch in China in 1999 (Starbucks, 2015), Starbucks has ensured to adapt to the local environment, which the firm has benefitted immensely from and proved to be essential to its enormous growth in China. In 2017, it has opened a new store every day and has aimed to have 5,000 additional stores within the next few years (Zakkour, 2017).
Starbucks has aimed to attain economies of scale as well as to increase knowledge and learning from the beginning and had thus a high global integration. Though, Starbucks has initially launched in Japan, its very first market outside of North America, with American foods. According to Flanagan (2014), these were oversized and too sweet. Consequently, they have since began to use local breads for downsized sandwiches, as well as reduced sweetness. Therefore, one can say that Starbucks has shifted from a global strategy to a transnational strategy in the beginning of its international expansion strategy.
