Post #3– Starbucks’s expansion to China?

With near-saturated US market and increasingly fierce competitions, the coffee giant, Starbucks, turns its eyeball to other countries in the world, and it finds another promising market –China.

Some people argue that Chinese consumers prefer tea over coffee; thus Starbucks’s expansion may be a failure as result of gap between Eastern and Western drinks preferences. However, I see China is a promising market for Starbucks, and my opinion comes from my experience in China.

The first thing I’d like to point out is the favorable social and demographic trend.  Coffee is increasingly appreciated by the younger Chinese generations, though tea is still the first choice for Chinese X-generations and before. This is an opportunity, for the younger generations are the potential life-long customers for Starbucks. And since they love coffee just like their counterparts in North America do, it is highly likely that their offspring will be influenced by their preference and thus turns into the second generation of Starbucks supporters or advocators.

Another opportunity is that there are few coffee houses in China, at least much fewer than that in Canada. Although tea is considered as an strong indirect competitor for Starbucks, there is seldom any tea house in China’s districts, because Chinese tea is home-made by tradition. This suggests a passenger can only go to coffee houses if he or she wants to sit down and enjoy a cup of drink, for there are no other appropriate alternatives ( bars are usually closed during the day in China).

Walking into a Starbucks shop in China, I can tell that the customers are usually the middle or up-middle classes. Those customers have sound financial footings, they are willing to pay more for the nice service and comfort environment brought by the Starbucks shops. A cup of Starbucks coffee may cost around 20-30RMB (about $3-$5), and the price is not cheap for normal Chinese wagers ( 30RMB to a Chinese is just like $30 to a Canadian, I guess you would drink less coffee if a cup costs you $30 ). In some sense, being a regular customer of Starbucks is symbol of a social status, as it indicates one has sound personal wealth and free time to rest in a coffee house.

Overall, my view is that Starbucks will make big profits in its expansion to China. If you ever go to a Starbucks coffee shop in China, you will find Chinese consumers like it!

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Post #2 – Car Advertisement of Mercedes, Porsche and BMW

If Honda is not treated as a strong competitor by BMW, then Mercedes and Porsche certainly are. Interested in finding out how these three luxury car companies advertise their products and compete against each other, I search the relevant advertisement on youtube and below are what catch my attention.

The first thing I like in this ad is the relaxing, harmonious, and amusing melody. The melody is relaxing at the start, singling a cozy driving experience that appealing to me. All of sudden, the tunes change as the Death come, and the man seems to be in danger. The funny part comes when the man says “sorry” to Death, while music tends to be amusing at that moment.Of course, the main point in this ad is to demonstrate the outstanding intelligent barking system of Mercedes-Benz 2010 E-Class, and the ads does striking me by creating such an unexpected result. This ads perhaps target on the consumers who value coziness and safety, as is presented by the reliable performance of car in the ads.

This is one of my favorite advertisements, because the inspiring spirit of the child impresses me a lot. The ads to me is not just about Porsche, but about the many deeply-entrenched dreams that accompany one’s growth. The child reminds me of myself, or perhaps we have something in common. I believe that everyone have dreams; for me, it is dream that drives me all the way along and it is dream that made me what I am today.

To me, the ads is also creative, because it tries to capture potential customers by appealing the feelings for passion and dreams rather than simply demonstrating the virtues of the car. It conveys a message to consumers  “The cars is yours once you have a passionate dream, and you can take it once your dream come true”.

This BMW advertisement targeted on investors, who accounts for a big proportion of Porsche’s customers. And it seems that BMW try to influence the mind’s of Porsche pursuers and turn this group into its own customers.

It’s a wise advertisement, since the it avoids to talk about issues such as  “power”,”speed” or “passion”, which may put BMW in shadow when compared with Porsche; rather, it emphasize “reliability”, which is a shining feature for a high-end business purpose vehicle. The ads tries to convince customers that BMW is more reliable than Porsche (cognitive component), and intrigue the positive feelings of “less risky”, “informative” and “reliable” (affective component).

Overall, these three advertisement can all entice consumers like me. The first one tells a surprising story, the second one narrate a impressing and inspiring story , and the third one shows a wise comparison.

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Post#1-What is valued in China?

Consider, you are going to expand your business to a fast-growing and increasingly dynamic  market, with  1.4 billion potential customers who are anxious to enjoy the rising wealth. While highly excited about the great business opportunity, you may probably ask yourself “What is much valued by Chinese consumers? What are the factors influencing their underlying values?”
To explore the value perspective of Chinese consumers, we need to take into the account the Chinese deeply-entrenched culture, turbulent history, centralized political system, and the trend of ongoing transformation in both business sectors and the spirit of younger generations. A recent article from Chicago Booth News (http://www.chicagobooth.edu/news/2010-12-08-china.aspx) has pointed out “security” is a vital factor in the successful massive marketing in China. China’s turbulent contemporary history, which encompasses autocratic rule, western invasion and imperialism, civil war, cultural revolution, extreme poverty,  has taught the majority of Chinese ( perhaps those who  born before 1980) to be risk-averse. That is, anything related to “peace”, “safe” or “stability” would be welcomed by Chinese customers. The article lists “Safeguard”, the most successful soap company in China, as an example of achieving massive marketing through appealing to the feeling of security.
If security is essential for Chinese born before 1980, then what is appealing to the new generations of China? In my opinion, it is perhaps “future”. Unlike their parents and grandparents, the Y-generation in China grow up in a fairly stable society, and they see the fast progress of their country as they grow up. “Development” is something  fascinating and admirable among them; as a result, they aim at future. For instance, smartphone is heavily pursued by the young Chinese, because they see smartphone as something necessary for a “future elite”. Also,  languages education industry boomed in the past decade, again, the reason is that  mastering a second language is deemed important for a brighter future.
Thanks for reading, and welcome to leave your thoughts =D
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