Starbucks Pricing Concerns, Essay Example

If you were in charge how would you explain the pricing issues of Starbucks coffee?

The pricing issues of Starbucks coffee appears to be primarily cultural in nature. In the United States, Starbucks coffee is able to be expensive because it is a cultural trend. When people drink coffee in public, they are more willing to pay more money for their coffee products because drinking brand name coffee improves the image of the individual. When Starbucks is exported to China, the pricing issue becomes more pronounced because not only are the consumers paying for the brand name, they are also paying for the increased price of the ingredients that are need to make the coffee products. Overall, Chinese products are becoming more expensive, which is not satisfactory to many customers. It is important to consider that this expensive perception of the brand could become problematic for the company, who may see a decrease in sales as a consequence of the view that it is an unnecessary luxury item due to the availability of similar products at lower costs. Some individuals argue that people pay for Starbucks coffee in China because it is the highest quality. However, others argue that the popularity of Starbucks coffee has only perpetuated because it is “shenshing”, meaning that the media is able to capture the eye of the consumer effectively, making the brand seem better than it is.

Overall, it is necessary for executives to consider that they must consider the cultural needs and expectancies of the Chinese market in order to continue to be successful. Many people believe that Starbucks is trying to be a brand that makes itself to seem better than it is. While many people who love Starbucks would agree that it is a high quality brand, it would be beneficial to determine how to revitalize the product in China so that its price can be decreased while still being available to the Chinese people. In summation, the pricing problem of Starbucks is that the price of its coffee is considered to be too high to many Chinese consumers. As a consequence, the main purpose of the coffee isn’t its taste, but the status that is associated with it.

Should Starbucks be considered a global “snob” brand?

In essence, Starbucks can be considered a global “snob” brand. Many people that have an affinity for Starbucks coffee are those that simply want to look cool while drinking it. It cannot be denied that many people simply like this brand of coffee better than other available options, but by purchasing coffee with such an inflated price and drinking it in public, it is sending others the sense that the person drinking the coffee is wealthy and is able to enjoy Starbucks without questioning the price. In this manner, it makes people who drink Starbucks look better than those that drink less expensive coffee options, independent of the taste that these other options offer. Overall, people who drink Starbucks are more likely to be showoffs than those that drink other brands. These are the individuals that are more likely to wear name brand clothing products and brag about the type of car that they drive, even though they may not have that much money in reality. A snob is an individual who designs the image that people have about them by using their money to purchase and enjoy luxury items. Starbucks is a part of this image because it is by no means necessary. For some, it is a treat that is occasionally enjoyed. For others, it is something that is avoided altogether due to the price. However, for those that are coffee “snobs”, Starbucks is their choice brand and they consume it on a regular basis. This personification of the coffee doesn’t just exist in China either. People who drink Starbucks coffee around the world, including in the United States, tend to feel self-important about their coffee choices. Thus, Starbucks remains successful because there are those who believe that they are better for choosing to drink this coffee brand instead of the alternatives, which makes this coffee company a global “snob” brand. Because of its high price and branding, this is a phenomenon that will likely continue throughout the duration of the company’s existence.