Starbuck is a dominant business in cafes and restaurants services, with stores and businesses in various countries. However, the company has not ventured fully in the Italian market. Starbuck has constantly faced a challenge reputational that has affected its expansion strategies considerably (Ashley 2005). This highlights that tackling this challenge provides an innovative strategy of penetrating the Italian market. However, addressing this risk is not easy because the company is likely to face serious challenges in its endeavor of managing the problem. Initially, the Italian market is crowded and segmented. Consequently, the coffee business thrives in most of the cities in Italy, posing the greatest challenge to any new investor. Numerous businesses in the country are offering the same services that Starbuck is trading in, which means that the competition is high. Building high reputation in such an environment may be challenging. To address this challenge, an investor can establish the partnership with local brands that have established reputation in the Italian market. This will provide the company with an effective strategy that can make the consumers belief on the quality of the Starbucks products.
Starbuck also faces the challenge of handling different styles of drinking and diverse brands that are in the market. Unlike the American market, the Italian market is evolutionary in styles of coffee drinking and the types of coffee used. In most of the American markets, only the Arabica beans are used. However, products that comprise a blend of the Arabica dominate the Italian market (Ashley 2005). This challenges Starbuck because it need adjust its products to suit to the market parameters. Surprisingly, some essential measure needed to realize such a situation might threaten the reputation of the business especially in product delivery. According to Showalter (2003), reputational intelligence and integrity dictates that the products offered by the business need to be identical.
The Starbuck should value their idea of globalization when venturing the Italian market. In Italy, coffee drinking culture is influenced by cultures from other countries such as China and Japan. This is challenging to Starbuck because it must offer services that are sensitive to diverse cultures (Sutton 2006). In essence, the idea of the capability of the company in adjusting to the Italian market poses a serious concern. In Italy, coffee drinking spreads over wide ranges. On grounds of the market availability, Italy is ideal for Starbuck. Opportunities for growth and expansion are many in the area. This goal is realizable only if the business is in the best position to carry out activities that are can build customer loyalty. Consequently, the business should emphasize the need of adjusting its activities to suit the consumers’ needs. This forms the ultimate root to success for Starbuck in Italy (Showalter 2003).
Another aspect that informs and influences entry in to the Italian market is the use of appropriate marketing strategies. Starbuck has survived in the market for a very long time. According to (2005), marketing marks a vital strategy for expanding and enabling business survive in a new environment. High competition forces characterizing the Italian market affirms that marketing in an essential survival strategy. Initially, effecting marketing will provide Starbuck with the opportunity of identifying the customers’ needs. Italy has a good coffee market; however, most consumers question the quality of services that are provided in the market. Starbuck can capitalize on this situation to establish some edge over its competitors. Lastly, the company should understand that entering the Italian market is tricky because the procedure demands financial support. This necessitates the significance of establishing reliable sources of finance. However, the company should not worry of the cost of the procedure because the Italy’s market is highly viable (Anastasi 2003). It is apparent that Starbuck is likely to succeed in the Italian market. However, the company should conduct a market evaluation to establish the most effective entry strategies that need to be adopted.
Anastasi, N. (2003). Starbuck has to open at North Fork bank branch. Long Island Business News , 1-1. Retrieved from http://search.proquest.com/docview/223626418?accountid=45049
Ashley, G. (2005). Witnesses have increased cooperation in willis-starbuck shooting case. Knight Ridder Tribune Business News. Retrieved from http://search.proquest.com/docview/460246333?accountid=45049
Showalter, K. (2003). Starbuck to succeed bachmann at ernst & young. Business First, 19(24), A6. Retrieved from http://search.proquest.com/docview/232387211?accountid=45049
Sutton, B. (2006). Starbuck's mission: Keep elon surging. Knight Ridder Tribune Business News. Retrieved from http://search.proquest.com/docview/463358009?accountid=45049